Phonepe allots USD 200 million worth stock to employees
By Edil Corneille
Bengaluru-based PhonePe, a FinTech company, in January 2021 earmarked stock options worth USD 200 million for its 2,200 employees. The announcement comes after Flipkart had announced in December 2020 the partial spin-off of PhonePe, as the digital payment firm had raised USD 700 million in funding, valuing the FinTech company at USD 5.5 billion.
“In January 2021, we launched the PhonePe Stock Option Plan that gives every PhonePe employee the chance to own a part of the company. The $200 mn plan allotted stock options to all 2,200 employees at PhonePe, enabling everyone in the organisation to benefit from its success,” PhonePe HR Head Manmeet Sandhu said.
“The PhonePe stock option plan is a core component of our compensation philosophy crafted to encourage collaboration, long-term focus and organisation-first thinking,” Sandhu added.
The company stated that it is focused on building a culture that eliminates internal competition and promotes an abundance mentality.
Sandhu went on to say, “Our compensation system aligns with this approach by removing variable pay based on individual performance for most roles. Instead, we use ESOPs to create the incentive for everyone to be invested in long-term organisational growth. By having ESOPs at a minimum of $5,000 for all levels, we enable every employee in the organisation to participate in the wealth generation opportunity that they themselves have helped create. We offer an informal environment, transparency and a flat organization structure, that enables everyone to focus on learning and delivering great results.”
PhonePe explained in a blog post that as roles become more senior, ESOPs become part of the annual reparation for employees. This means a larger component of the employee’s compensation is tied to the organisation’s success, thereby encouraging everyone to put the organisation first.