Esops for INR 1 Lakh are Granted to More than 3,000 Employees by Razorpay in Celebration of its 10th Anniversary

Nitin Konde, Varun Bhardwaj

Dec 25, 2024 — 2 min read

Razorpay Grants INR 1 Lakh ESOPs to 3,000 Employees for 10th Anniversary

In honour of its tenth anniversary, digital payments startup Razorpay announced on 24 December that it is offering every one of its current employees an employee stock ownership plan (Esop) worth INR 1 lakh. The program has a total Esop value of more than INR 30 crore, according to the Bengaluru-based company, which employs more than 3,000 people.

Esops are firm shares that are given to employees and can be cashed at a fixed price after a specified amount of time. When Razorpay was founded in 2014, its founders didn't consider it a business; rather, they saw it as a solution to a significant customer issue, and they were interested in the challenge of integrating payment systems. According to Harshil Mathur, cofounder and CEO of Razorpay, solving that issue has been the unifying factor up to this point.

As Razorpay continues to innovate, streamline money transfers, and provide even more value for companies in India and abroad, the Esop program is the brand's method of guaranteeing that every team member benefits from the success, he continued.

Shifting Parent Company’s Domicile to India

In keeping with the reverse-flipping trend among Indian startups hoping to take advantage of high valuations in the nation's public markets, the fintech company made the statement as it requests permission from the Reserve Bank of India (RBI) to move its parent company's domicile from the US to India.

Razorpay, which was recently valued at about $7.5 billion, may face a 30–40% decline in fair market value if it decides to do the reverse flip to India, according to a media article published on November 21. Razorpay has turned a profit in its primary payments operation and intends to go public within the next two years. However, Mathur told a media source in an interview on December 18 that it would take another 1.5 years for the company to reach full profitability.

In FY24, the company's payments division recorded INR 2,501 crore in total revenue and INR 34 crore in net profit. For FY24, the business also disclosed an annualised total payments volume of $180 billion.

Business Dynamics of Razorpay

Razorpay was established in 2014 and offers companies of all sizes a full range of payment options. To help businesses receive, process, and distribute payments, it provides services like payment gateways, payment aggregates, and financial management solutions. Investors such as Lightspeed Venture Partners, Tiger Global, Peak XV Partners Matrix, and Y Combinator are among those who support it.

Razorpay has started onboarding new merchants since obtaining final permission for its payment aggregation company in December 2023. Despite the fact that the enormous Esop pools may seem like "wealth on paper," consumer internet companies have occasionally given their staff members the opportunity to sell their interests. This year, more than a dozen modern businesses, such as Swiggy, Meesho, Purplle, Urban Company, Whatfix, Pocket FM, Dehaat, and MyGate, have enabled Esop buybacks.