Urban Company completes ESOP buyback valued at $ 2.8 billion

Home service marketplace Urban Company has completed an ESOP buyback program valued at 55 billion rupees, or $ 7.3 million. This is the fourth ESOP liquidity program the Gurugram-based company has completed since its inception.

The latest transaction was completed at a valuation of $ 2.8 billion, according to Urban Company. The size of the buyback is insignificant, but it does stand out at a 33.33% premium over its last valuation six months ago.

It was valued at $ 2.1 billion during its $ 255 million Series F round in June of that year.

All current and former employees with vested ESOPs were eligible to participate in the program, with the option to sell up to 100% of their vested ESOPs, Urban Company said in a Blog Post.

To date, Urban Company has enabled its 940 current and former employees in the four programs to make ESOP sales worth Rs 100 crore. Among them, 550 employees had purchased ESOPs and were eligible to participate in the transaction. The company’s first ESOP buyback took place in June 2017, followed by the second such event in December 2018 and the third in August 2020

Just last week, the company led by Abhraj Singh Bhal had re-allocated shares to 181 employees, including a number of former and current top executives, as part of its ESOPs plan.

Trickypedia would have exclusively reported the development.

Urban Company is counted among a group of growth and late-stage startups that enabled ESOP’s liquidity in 2021 List contains Vedantu, Meesho, Browserstack, Udaan, Unacademy, ShareChat, Razorpay, CRED, MPL, Licious, Classplus and HealthifyMe.

2021 was also marked by a much more generous approach towards all current and former employees when it comes to transferring ESOPs to many startups. This is reflected not only in the frequency of liquidity events, but also in the generous conditions for most employees, including former employees.

Earlier this year, Urban Company had announced an open source ESOP framework in collaboration with MyStartupEquity, a cap table and an ESOP management product from LetsVenture. The framework advocates better ESOP guidelines, structured terms and conditions, among other things.

In FY21 the Urban Company succeeded in evading the trend of awarding contracts growing operating sales 13.3% to Rs 247.7 billion in FY21 from 218.6 billion in FY20. Over the same period, its losses in the last fiscal year increased 61% to Rs 249.3 billion compared to Rs 155.2 billion in FY20