Quick Commerce Major Zepto Expands ESOP Pool By $170 Mn

Quick commerce unicorn Zepto has expanded its employee stock option (ESOP) pool by $170 Mn (about INR 1,495 Cr), taking the total value of its options pool to more than $500 Mn (about INR 4,637 Cr), as per its recent filings with the Registrar of Companies (RoC). 

The Bengaluru-based startup has allotted an additional 39.4 Lakh stock options, expanding its ESOP pool to 1.2 Cr options. With the recent ESOP expansion, the total value of the ESOP pool now stands at about $527 Mn (around INR 4,637 Cr). 

This marks one of the largest ESOP pools among late-stage Indian startups in the consumer internet segment.

In parallel, the startup has also approved an interest-free loan of INR 700 Cr (about $84 Mn) to its employee welfare trust, enabling employees to exercise and purchase vested shares without significant upfront financial burden.

The move follows Zepto’s recent $450 Mn (around INR 3,955 Cr) funding round led by US-based pension fund California Public Employees’ Retirement System (CalPERS). Zepto attained a valuation of $7 Bn pursuant to the funding round, up about 40% from the $5 Bn valuation it attained last year.. 

The round was a mix of primary and secondary capital, with primary transaction accounting for a large part. “We now have approximately $900 Mn of net cash in bank and (are) more than well-capitalised for the future,” Zepto cofounder and CEO Aadit Palicha said while announcing the round.. 

Zepto said it scaled order volume 200% over the past 18 months and was able to consistently turn “more and more” of its stores profitable even as it invested in growth.

On the financial front, its revenue grew 149% to INR 11,100 Cr in FY25 from INR 4,454 Cr in the previous fiscal year, as per regulatory disclosures made by its backer Elcid Investments. However, Zepto is yet to file its financial report for the fiscal year as of now. In FY24, the startup posted a loss of INR 1,248.6 Cr. 

The scaling of the ESOP pool underscores Zepto’s strategy to retain and incentivise workforce as the startup intensifies its expansion bid in the run up to filing for its IPO. To note, Zepto, which has raised about $2.5 Bn from investors till date, was earlier looking to file its DRHP with the SEBI by the first quarter of 2025.

The startup delayed the IPO filing owing to its plans to double down on its profitability and domestic shareholding. Now, the startup is reported to be looking at filing its IPO papers with the SEBI by early 2026 to raise around $800 Mn through the public offering.

Meanwhile, it is imperative to mention that Zepto is facing intense competition in the country’s growing quick commerce segment, which is expected to breach the $40 Bn mark by 2030. While Eternal-owned Blinkit has maintained a lead in the segment, Swiggy’s Instamart has also gained significant share in recent times. Meanwhile, larger businesses like Reliance, Amazon and Flipkart are also doubling down on their quick commerce offerings over the ongoing year. 

In recent times, Zepto has been showing signs of slowing down. To note, Zepto scaled down its food delivery offering, Zepto Cafe, earlier in July citing sourcing issues and a shortage of trained kitchen staff.  The halt has already affected over 400 employees.

Besides, it is also reported to have cut down on its dark store expansion plans and reduced marketing spends. Reports indicate Instamart and Blinkit have gained market share as Zepto moderates aggressive growth and focuses on financial discipline.  In line with this, sources told Inc42 that Zepto has cut over 500 jobs, including on-roll and off-roll,  since April this year to control its expenses.