Funding Societies has announced its Employee Stock Option Plan (ESOP) buyback for existing and former employees worth US$16 million (RM67 million). The ESOP buyback marks the fourth time this activity has been conducted by the FinTech platform. Prior, employees and company alumni have cashed out US$3.5 million (RM14.7 million) worth of ESOP shares.
Funding Societies’ ESOP policy was crafted to uphold inclusivity and equality, the firm said in a statement. Under the buyback scheme, all eligible former and current employees would have a right to sell their shares at no discount to the Series C+ preference share price to incoming investors, as compared to the customary 20% discount in industry. Employees may also choose to keep their ESOP or convert their vested ESOP into shares, effectively becoming company shareholders.
Many Funding Societies employees are eligible for the ESOP policy, including new hires. The company offers 50% of total annual salary in ESOP allotment for eligible new hires, leading the market and setting industry standards. Funding Societies also places strong emphasis on long-serving employees in its ESOP scheme.
Eligible loyal employees are entitled to ESOP on every 2-year anniversary of joining the company. More than 120 current and former employees since Funding Societies’ inception received cash rewards from this share buyback.
Kelvin Teo, co-founder and group CEO of Funding Societies | Modalku, said, “Cliche as it may be, people are the center of Funding Societies | Modalku. We’re grateful for their faith and dedication to realize the vision of empowering Southeast Asian MSMEs, including that of our current team members, and especially from many founding team members in each country who are still with us, along with talent who have left us after an amazing stint, and people who have returned to us.
“We decided to buyback at no discount rather than the usual 20% discount, equating to a few millions more in cash pay-out, as a tangible way to thank our team. And I’m heartened when some team members shared about their first home with me from their ESOP gains.”
He added: “Even before our Series C+ round, I am pleased to report that 2021 saw the lowest employee attrition rate and the highest employee happiness scores since Funding Societies was founded. Despite the impact of Covid-19, we have taken deliberate steps to appreciate our team across various initiatives including internal communications, learning & development and ESOP, among others. Next, we want to do more to create a suitable working environment for parents. Specifically, we have taken steps to accommodate mothers with better family benefits and have launched part-time positions with more flexible working hours.”
Wong Kah Meng, co-founder and CEO of Funding Societies Malaysia remarked on the importance for companies to recognize and appreciate talents: “Our people are our greatest asset, and we wouldn’t be where we are today if not for their hard work and dedication. As we look to grow further this year, we aim to cultivate the same supportive environment for all our colleagues, and this ESOP scheme is an extension of our efforts in showing our appreciation. This fourth round of buybacks will benefit a larger number of former and existing colleagues, including our Malaysian talents.”
The announcement came just a month after the company’s C+ funding round totalling US$294 million (RM1.23 billion) led by SoftBank Vision Fund 2 and other investors, including VNG Corporation, Rapyd Ventures, Asia-based global investor EDBI, Indies Capital, K3 Ventures, and Ascend Vietnam Ventures.
The round also includes US$150 million (RM630 million) in debt lines from institutional lenders across Europe, the United States, and Asia. Most of the raised funds will be utilised to propel company services for micro, small and medium enterprises (MSMEs) across Southeast Asia.
