CARS24's ESOP Strategy: Trust Through Liquidity and Fair Terms

After 5 major ESOP buybacks and 10 years of building Cars24, let me share how we've ensured ESOPs aren't treated as paper wealth -

The last few days have been noisy around ESOPs. And one event can shake trust across the ecosystem.

ESOPs are crazy. They’ve created life-changing wealth for many. But often, they haven’t. That’s why founders must treat ESOPs as a trust instrument, never as a compensation negotiation tactic.

At Cars24, we’ve stayed anchored on a few principles:

1. ESOPs must become real, not just paper wealth. It’s our job to create liquidity and belief.

2. Terms can’t be one-sided. Employee-friendly by design. No draconian clauses.

3. Sharing wealth doesn't divide it. It multiplies it.

ESOPs are recognition for the real builders - not a tool to reduce cash salary.

And trust isn’t built through talks. It’s built through actions.

We’ve done 5 MAJOR BUYBACKS so far.

The first was in May 2018 - way before anyone else. It was early, intentional and driven by a simple belief: liquidity will multiply trust into Cars24 ESOPs by 10x. And it happened!

At the onset of COVID, when most orgs were executing mandatory pay cuts, we opened a voluntary pay cut window and offered 2x fully vested ESOPs to anyone who opted in. We were scared how business would shape up, and cash conservation was key. 300+ people volunteered, contributing from a few thousands to tens of lakhs. Six months later, as the industry tailwinds became clear and favourable, we opened a buyback at 2X THE PRICE. So volunteers effectively got 4x back in cash, in less than 6 months.

That wasn’t math. That wasn't logic. That was trust returned with trust.

Last year in December, we did a cashout for our AU and UAE teams so newer members could experience what ownership means in practice - not just on paper.

Ask any ESOP holder at Cars24 what it means to them. You’ll get stories - not opinions.

My advice: yes, contracts and terms matter. But what matters most is intent at the top. If the intent to share wealth is genuine, ESOPs are absolutely worth the risk:reward.

Don’t let one-off events hurt your confidence in ownership. Let them raise your bar for what “employee-first ESOPs” should look like.