PhonePe founders' pay cut: Salary drops to Rs 5 crore
PhonePe has attracted a set of high quality, marque investors like Walmart, Tiger Global, Ribbit Capital, Tencent, Microsoft who have invested over Rs 18,000 Crore in the company till date.
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The founders of PhonePe, Sameer Nigam and Rahul Chari, saw a significant reduction in their overall compensation for the fiscal year 2024. While their combined salary and benefits dropped to Rs 5 crore from Rs 7 crore in the previous year, the more substantial decline came in the form of Employee Stock Ownership Plan (ESOP) valuations.
The value of ESOPs granted to Nigam and Chari plummeted by 75 percent to Rs 226 crore in FY24 compared to Rs 917 crore in FY23. This sharp decrease can be attributed to the company's valuation rising from $5 billion to $12 billion during a fundraising round in FY23. The higher valuation resulted in a larger share-based payment value for the founders in the previous year.
Despite the reduction in ESOP values, Nigam and Chari's total compensation packages remain substantial, as the majority of their earnings are derived from these equity-based incentives.
Many of PhonePe's leaders have helmed different businesses over time and have rotated from large successful verticals to new nascent opportunities. Also, the leadership team has a diverse set of professional skills, ranging from building cutting-edge technology startups to managing national supply chains to working at hedge funds.
Apart from Nigam and Chari, PhonePe has other key members as part of the organization structure - Adarsh Nahata, as CFO, Manmeet Sadhu as HR, Aniruddha Patwardhan Head of Engineering, Consumer Payments, Shalini C, Compliance, Parag Mathur, Legal, Srijon Biswas Head Of Engineering, BFSI, Karthik R Strategy & IR, Priya Patankar, Communications, and Burzin Engineer as CRO.
In a series of corporate restructuring actions, starting in 2022, PhonePe first moved its domicile from Singapore to India permanently, and then further set up separate Indian subsidiaries to house each of our new core businesses.
"The domicile was changed to India, because we strongly believed that as a homegrown and highly regulated Indian ntech company, we should eventually publicly list in the Indian bourses. Our investors, led by Walmart, paid almost Rs 8,000Crore (close to USD 1 Bn) in taxes to the Indian government to affect PhonePe’s domicile shift to India," stated the company in its annual report.
Today, “PhonePe Private Limited” houses its core Payments business. It is also the holding company for all its other businesses.
"We have consciously chosen to house each of these subsidiaries in a separate entity, with its own CEOs, to ensure more independence to each business’s leadership teams, better local corporate governance accountability, and finally more transparency by creating clear arms-length separation and cross-charging mechanisms across businesses," stated the company.
Priya Narasimhan, CBO, Indus Appstore, Ritesh Pai CEO, PhonePe International, Vivek Lohcheb CEO, Pincode, Yuvraj Singh Shekhawat CBO, Merchant Payments, Sonika Chandra CBO, Consumer Payments, Vishal Gupta CEO, Insurance, Hemant Gala CEO, Lending, and Ujjwal Jain CEO, Share Market are part of the leadership team under PhonePe's other businesses.
PhonePe has 50 percent share of UPI payments in the market. The company processes around 7 billion transactions worth around Rs 10 lakh crore in a month.
PhonePe has attracted a set of high quality, marque investors, who have invested over Rs 18,000 Crore in the company till date. Led by its majority shareholder, Walmart Inc, its list of investors includes some of the most iconic strategic investors, sovereign funds and Private Equity investors globally like Tiger GLobal, Ribbit Capital, Tencent, and Microsoft.
