Social commerce platform Meesho, run by Fashnear Technologies, has implemented an employee stock ownership plan (ESOP) buyback for its employees. This is the first buyback by the company where 60% of eligible employees exercised the option to sell up to 30% of their vested ESOP shares.
Existing investor Naspers bought employee stock options worth $1 million, the company said in a statement.
“With a buyback this early in the business, we want to recognise their efforts, reward them for their contribution in building Meesho and show real value in our ESOPs to existing and potential employees. This buyback from Naspers shows their belief and confidence in Meesho and its mission to create entrepreneurs across the country,” Sanjeev Barnwal, founder and CTO of Meesho, said.
In August last year, the company raised $125 million in a funding round led by Naspers, with participation from Facebook and returning investors SAIF Partners, Sequoia Capital, Shunwei Capital, RPS and Venture Highway.
Meesho was founded by IIT-Delhi graduates Barnwal and Vidit Aatrey in 2015. The company enables small businesses and individuals to start their online stores via social media channels such as WhatsApp, Facebook and Instagram. It claims to have enabled more than 2,600,000 entrepreneurs across India to sell on the social media platforms by providing them products, logistics and payment tools. The company said that 70% of the entrepreneurs on its platform are homemakers, career women on breaks and students.
The firm’s FY19 losses widened to Rs 100 crore due to high operating expenses.
According to a study by Nielsen, the social commerce market in India is worth $70 billion. Recently, digital payments major Paytm also entered the space with MyStore.