India’s leading home service marketplace Urban Company has rolled out an open source ESOP framework policy for India’s startup ecosystem. To create this framework policy, it has collaborated with MyStartupEquity, a cap table and ESOP management product by investment firm LetsVenture.
Urban Company and MyStartupEquity claim that ESOP is a generally tedious process and they plan to utilize this open-source framework to help startups & private companies in providing better structure terms and conditions as well as launch ESOPs that not only help employees in creating wealth but also facilitating a better future for the startups.
Both companies have claimed that this open-source ESOP framework is freely available. This framework is essentially a legally vetted document and the cornerstone of the policy is having simple vesting terms, a reasonable exercise price on options and a generous exercise period. Additionally, the framework also offers with easy to use templates for grant and exercise letters.
Last year, Techpluto had spoken to LetsVenture’s Co-founder & CEO Shanti Mohan for a feature article on Letsventure. To read the story, please click here.
Commenting on the latest development, Abhiraj Bhal, Co-Founder, Urban Company, “Urban Company has created substantial value for its employees through ESOPs, conducting three secondary sales in less than six years for existing employees worth nearly $8mn. We believe a robust, employee-friendly ESOP programme is one of the pivotal pillars in attracting and retaining talent and building team morale. We now want to extend this framework to budding entrepreneurs and lend a helping hand in their entrepreneurial journey.”
Sanjay Jha, Co-founder & CPO, MyStartup Equity said, “Talent is the most important growth driver for a startup. Therefore, it’s not only important to attract top talent but also to retain and reward them and we have seen ESOPs play a very important role here. We are happy to collaborate with Urban Company in developing this ESOP framework which helps startups in India adopt not only an employee friendly policy but also addresses the interests from the company’s side as well. ”
In India’s burgeoning startup industry, Urban Company has proved to be a standout example in leveraging ESOP as a tool for employee wealth creation and charting a high growth trajectory in the process. In the period of six years, the company has already conducted three secondary share sales to offer its employees a benefit of ~$8 M. Its last ESOP secondary sale was held in August 2020, with each ESOP being valued at INR 110,000.