Indian agritech startup Ninjacart has rolled out an employee stock ownership plan (ESOP) worth more than INR 100 Cr, according to a statement by the startup.
Both current and former employees of the startup with vested ESOPs as of December last year, are eligible to participate. The startup had raised $145 Mn from Walmart-backed Flipkart earlier last month, valuing it at between $700 Mn and $800 Mn.
Founded by Thirukumaran Nagarajan, Sharath Loganathan, Sachin Jose, Kartheeswaran KK and Vasudevan Chinnathambi in 2015, Ninjacart sources fruits, vegetables and other groceries from farmers and suppliers to sell them to supermarkets, kirana stores and other retailers.
It is also expanding its footprint into the fast-moving consumer goods (FMCG) segment, procuring from big brands and selling to store owners and other resellers. According to the startup, it currently moves over 1.4k tons of fresh produce per day from farmers across more than 20 Indian states to over 17k kirana stores in seven Indian cities.
“This ESOP buyback programme is a small gesture of our gratitude towards our employees because, without them, we will not be where we are today. ESOP buyback plans offer people a true chance at wealth creation and it allows employees to participate in the company’s success which has only been possible through their hard work and loyalty,” said Thirukumaran Nagarajan, cofounder and CEO of Ninjacart.
The pandemic has accelerated ESOP buyback phenomenon into a marathon among many Indian startups. Back in 2018, hundreds of Flipkart employees became millionaires after Walmart acquired the Indian ecommerce platform.
An increasing number of startups are using ESOPs as a tool for employee retention as well as employee wealth creation—something that is especially true for the ecommerce industry.
With junior and middle management attrition rates as high as 15-20% in the ecommerce industry, such startups often resort to ESOPs to retain and attract employees they couldn’t have done otherwise.
Last year, we saw many startups incorporating the ESOP buyback programs in their strategies to retain and attract talent. A few names including CRED, PhonePe, and Meesho also have walked the path to meet this objective.