Logistics Startup Porter Executes $5 Mn ESOP Liquidation

SUMMARY

Only those employees or ex-employees who had vested their options by December 31, 2021 to be eligible

Move to benefit 80% senior and mid management and 20% lower management

Porter competes with the likes of BlowHorn and LetsTransport in the $43 Bn unorganised intra-city logistics sector

Bengaluru-based intra-city logistics startup, Porter, has implemented its maiden Employee Stock Ownership Plan (ESOP) worth $5 Mn. The move will allow all eligible current and former employees to sell their holdings.

Only those who had vested their options by December 31, 2021 will be eligible for the monetisation scheme.

The startup will undertake equitable distribution of benefits and the number of options shall be equally allocated so that every eligible employee benefits from the scheme. A statement from the startup said that the ESOP programme is designed for 80% senior and mid management and 20% for lower management.

Founded in 2014 by Pranav Goel, Uttam Digga & Vikas Choudhary, Porter is a logistics platform that optimises last-mile delivery operations for businesses. The Tiger Global-backed startup has so far raised over $131 Mn in funding in the last seven years. The recent Series E round in October last year helped the startup raise close to $100 Mn.

Porter claims to have served over 50 Lakh customers in 13 cities and currently boasts of 2 Lakh delivery partners.

India’s unorganised intra-city logistics tech market is currently pegged at $43 Bn and is crowded by individual trucks owners. Porter faces stiff competition from some of the new age startups that include BlowHorn, LetsTransport, Shift Freight, Blowhorn, COGOS, among others.

Adding to that, India’s logistics tech sector is highly competitive and has produced four unicorns so far namely Delhivery, Rivigo, Blackbuck and Moglix. Porter also competes with these behemoths. The rise of the sector has been attributed to Covid-19 which snapped supply chains, along with the rise of ecommerce platforms and hyperlocal deliveries.

A RedSeer report says that India’s overall road logistics market is set to cross the $330 Bn mark by 2025. Another report by RedSeer says that intra-city logistics represent close to 13% of the total market.

The ESOP announcement comes on the heels of a slew of companies announcing such monetisation programmes. Earlier this year, IPO-bound interior design startup HomeLane announced ESOP liquidity programs worth $3.3 Mn.

In January this year too, B2B agri-marketplace, Ninjacart, also implemented a $13.4 Mn ESOP scheme. Barely days ago, credit card payment platform CRED also expanded its ESOP pool to nearly $500 Mn.

2021 saw as many as 40 ESOP buyback announcements in which Indian startups bought back over $440 Mn of holdings held by their employees.

While Porter appears well on its way for a billion-dollar evaluation, the move has brought cheer to the employees. The sector appears all set for a great run but the competition continues to be fierce.