Razorpay Grows ESOP Pool Amid Competitive Fintech Scene

Razorpay is an online payment and banking solutions offering fintech unicorn that provides payment gateway solutions for businesses. The firm expanded the Employee Stock Option Plan by allocating new employee stock options worth Rs 1 lakh to its current ESOP pool. This is the firm’s third ESOP expansion round, increasing the total ESOP size for its employees. These newly allocated employee stock option plan shares are worth Rs 1 lakh each for all its employees.

The company posted that in a stock exchange filing the board approved the allotment of these stock options to those under the Razorpay employee stock option plan. The company expanded its ESOP pool size under its second ESOP buyback in 2022. Those stock options worth $75 million benefited 650 former and current employees. In 2018, around 140 employees liquidated their vested shares under the first ESOP buyback. Razorpay offers a platform supporting various payment methods including net banking, Credit, debit cards, and UPI.

The company provides solutions such as payment links, subscription payments, UPI-based recurring payments, and more. The startup has raised around 800 million USD across multiple funding rounds to date. This includes $375 million secured during its series F funding round at a post-money valuation of 7.5 billion USD from Alkeon Capital Management, TCV, Loen Pine Capital, and other investors.

The development came after the company announced its financial results for FY24. This marks the third time since this fintech firm expanded its employee stock option plan’s pool size. The company plans to launch its Razorpay Venture Investment program for B2B innovators. The fintech firm claims to serve around 300 million end customers across India with an annualized TPV of 180 billion USD. Razorpay plans to shift its domicile from the US to India by the end of 2024. 

The Bengaluru-based startup posted a 24 percent YoY increase in its revenue to Rs 2,068 crore in FY24. However, the net profit increased by 365 percent to Rs 33.5 crore during the same period. The firm’s operating revenue saw a 9 percent YoY increase to Rs 2,475 crore. Razorpay has investors including Peak XV Partners, Tiger Global Management, and Y Combinator. The fintech firm faces competition from other online payment platforms in the same market segment including Pine Labs, Zaggle, Paytm, and Zestmoney.

Conclusion :

Razorpay expanded its employee stock option Plan by allocating Rs 1 lakh worth of stock options for its 3k employees. These newly allocated shares are set to benefit employees across all levels and functions. The banking solution and payment gateway platform provide financial solutions for businesses. This is the third Razorpyay’s Employee Stock Option Plan liquidity program.

The Bengaluru-based fintech firm allows customers to use various payment methods including net banking, credit, debit cards, wallets, and more. The company posted an operational revenue of Rs 2,475 crore in FY24. The startup had a net profit of Rs 365 crore and it competes with other platforms like Paytm and Pine Labs.

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