200 Paytm employees become millionaires as company valuation soars

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Paytm has reached a valuation of about $10 billion (approx Rs 63,537 crores), the company implied on Monday. The valuation of Mobile payments provider was obtained after 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 the latest round,” Paytm said to Moneycontrol. Previously, the company was valued at approximately $7 billion in May after a funding round where Japanese investor SoftBank invested $1.4 billion (approx Rs 9,000 crores) in parent company One 97 Communications. Thus now Paytm is the second most valuable startup in the country following Flipkart which is valued at $12 billion.

Approximately, 200 Paytm employees converted their employee stock options (ESOPs) for Rs 300 crores, the report added. ESOPs are privileges that are offered apart from salary 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 has benefited,” Paytm said.

Paytm founder Vijay Shekhar Sharma, a year ago, sold 1 percent 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 turned widely popular following demonetisation in November 2016. The company’s success has permitted it to expand its verticals that incorporate Paytm Payments Bank, Paytm Mall and Paytm Money among other things.

In the Meantime, Indian e-commerce platform Flipkart too disbursed $100 million for buying 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.

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