200 Paytm employees become millionaires as company valuation touches $10 billion

Mobile payments provider Paytm has reached a valuation of about $10 billion (approx Rs 63,537 crores), the company said on Monday. The valuation was achieved following a secondary sale where existing and former employees sold part of their ESOPs to new investors including undisclosed family offices and a few western offices for Rs 300 crores (approx $47.2 million).

"Company valuation rises close to USD 10 billion in latest round," Paytm told Moneycontrol. The company was previously valued at around $7 billion in May following a funding round where Japanese investor SoftBank invested $1.4 billion (approx Rs 9,000 crores) in parent company One 97 Communications. This made Paytm the second most valuable startup in the country after Flipkart at $12 billion.

Around 200 Paytm employees liquidated their employee stock options (ESOPs) for Rs 300 crores, the report added. ESOPs are benefits aside from salary offered to employees in the form of shares in the company. "Paytmers who have been with the company since inception to as early as one year have benefited," Paytm said.

Over a year ago, Paytm founder Vijay Shekhar Sharma sold 1 per cent of his share in the company for Rs 325 crores to raise money for Paytm Payments Bank, a mobile-first bank that went official in November 2017. The mobile wallet app became extremely popular following demonetisation in November 2016. The company’s success has enabled it expand its verticals that include Paytm Payments Bank, Paytm Mall and Paytm Money among other things.

Meanwhile, Indian e-commerce platform Flipkart also recently disbursed $100 million for repurchasing ESOPs of over 3000 present and former employees. SoftBank has been investing in both Flipkart and Paytm for a while now. In fact, SoftBank began backing Flipkart in August after investing $2.5 billion to take on Amazon India. The investment came after SoftBank failed to merge Snapdeal with Flipkart.