The high valuation of Flipkart, especially after
the latest funding round in which the company raised $1 billion, has made
around 400 employees "crorepatis". These employees, as the norm is in
technology companies, hold lots of company shares as part of their
compensation. The latest funding round gave Flipkart a valuation of around $7
billion.
According to a report in a business daily,
"About one-fourth of Flipkart's 7,000 full-time employees own a stake in
the company."
"About 400 of the employees who own a stake
have now become crorepatis," a person with direct knowledge of the
employee stock option scheme at Flipkart, told the newspaper.
Of the 400, around 20 employees who are in senior
positions now own stocks worth at least $1 million.
Interestingly, the $7 billion valuation for
Flipkart may be on lower side given its reach, ambitions and potential of
growth in Indian e-commerce space. The sector is valued at around $10 billion
currently. In comparison, the Chinese e-commerce sector is valued at around
$230 billion. Over the next few years, Indian e-commerce sector is poised to
grow to around $40 billion.
This is something drew attention of a Jefferies
analyst . "We believe India is one of the most exciting markets for
Internet-related companies (and their investors), as it offers the rare
combination of high growth on a large base," Jefferies analyst Arya Sen
wrote in a report in February this year.
Flipkart is not yet profitable. But it is one of
the biggest e-retailers in India and even though it faces a strong challenge
from Amazon, which started its marketplace in India, last year, in the coming
years it can hit very high valuations. Once that happen, there are likely to be
many more millionaires among the Flipkart employees.
Reference Url: http://indiatoday.intoday.in/story/400-flipkart-employees-have-become-crorepatis-report/1/377156.html
Reference Url: http://indiatoday.intoday.in/story/400-flipkart-employees-have-become-crorepatis-report/1/377156.html