IPO-bound food and grocery delivery giant Swiggy has announced its fifth ESOP (employee stock ownership plan) liquidity programme, offering up to $65 million in liquidity to its employees across various levels and functions. This move is part of Swiggy’s ongoing commitment to providing wealth-creation opportunities for its workforce as it prepares for its initial public offering (IPO).
Co-founders Sriharsha Majety and Nandan Reddy, along with other employees, will be selling some shares in the company’s upcoming ESOP programme. The shares will be sold as part of ongoing secondary transactions, with the firm currently valued at $9.3 billion, according to industry sources.
“This is the fifth liquidity event for Swiggy since 2018 and the third consecutive event after July 2022 and 2023, making it one of the few start-ups to consistently enable wealth-creation opportunities for its employees. So far, the company has cumulatively enabled over Rs 1,000 crore of ESOP liquidity over the five events, benefiting over 3,200 employees,” the company stated.
Girish Menon, head of human resources at Swiggy, emphasized the company’s commitment to its employees, stating, “Rewarding employees by unlocking wealth-creation opportunities as Swiggy grows has always been a key priority for us. Employees owning shares of their company creates alignment of incentives and a sharp focus on collaborative excellence, which is a virtuous cycle that we believe in and espouse. As we approach the milestone of a decade of consumer love for Swiggy, the latest ESOP event is an acknowledgment of our employees’ contributions, and our commitment to sharing Swiggy’s success and growth with them.”
Swiggy’s competitor Zomato has also been active in the ESOP space, reportedly approving grants of 40 million stocks under its 2014 and 2021 plans, covering Rs 892.19 crore worth of Zomato stocks.
Swiggy, based in Bengaluru, had confidentially filed initial public offering (IPO) papers for Rs 10,400 crore (approximately $1.25 billion) and is expected to go public in the coming weeks. Despite a marginal reduction in fair value by American investment firm Invesco as of April 30, Swiggy had previously raised $700 million in an Invesco-led funding round in January 2022, doubling its valuation to $10.7 billion and achieving decacorn status.
Earlier this year, Invesco marked up Swiggy’s valuation to $12.7 billion, reflecting a 19 percent increase from its last fundraising valuation. Despite facing valuation cuts due to high cash burn and poor margins last year, Swiggy has been on a path of financial recovery, gearing up for its over $1 billion IPO.
Additionally, US-based Baron Capital Group increased Swiggy’s valuation to $15.1 billion as of March 31, a 25 percent increase from the last fair value recorded. Baron Capital had participated in Swiggy’s $700 million funding round in January 2022.