AI-powered HRtech unicorn Darwinbox completes Rs 86 crore ESOP buyback

Darwinbox, the Hyderabad-based software-as-a-service (SaaS) unicorn specializing in human resource technology, has concluded a Rs 86-crore employee stock ownership plan (ESOP) buyback, marking its third such liquidity event in four years.

The transaction, involving over 350 employees across its 11 global offices, is the largest ESOP repurchase in the company's history.

Unlike typical ESOP buybacks facilitated by external investors, Darwinbox has directly acquired stock options from employees, underscoring a growing trend among growth-stage startups to use internal capital for employee wealth creation.

“At Darwinbox, we’ve always believed that those who help build value should share in it. Even as we invest deeply in innovation and global growth, we remain equally committed to creating meaningful outcomes for our people. This buyback, like the ones before, reflects our belief in sharing success with our people and building a culture of ownership,” said Jayant Paleti, Co-founder of Darwinbox.

Founded in 2015, Darwinbox empowers enterprises to better manage their talent with new-age employee experiences and disruptive AI-powered technology. Its cloud-based Human Capital Management (HCM) software caters to an organization's HR needs across the entire employee lifecycle. Darwinbox claims that it serves over 4 million employees from more than 1000 enterprises across 130 countries. It is backed by investors like KKR, Partners Group, TCV, Microsoft, Salesforce Ventures, Peak XV, Lightspeed and Endiya Partners among others.

The company has emerged as a key player in the rapidly digitizing HR tech landscape. Earlier this year, it raised $140 million in a predominantly secondary transaction co-led by global private equity firms KKR and Partners Group. That round, which saw early investor Lightspeed partially exit, valued the company at approximately $950 million.

Darwinbox has since channeled its efforts into enhancing its AI-led HR infrastructure. Among its latest product innovations are the MCP (Model Context Protocol) Server, which enables AI agents to securely access HR data, and Darwinbox Sense, a generative AI engine embedded with over 40 HR capabilities. The company also expanded its multi-country payroll offering to 10 new geographies over the past year.

Its revenue for FY24 surged 58% year-on-year to Rs 392 crore, driven by international expansion, increased adoption from existing clients, and sustained investment in R&D. The company is targeting similar growth levels for FY25.