ESOP Buyback

Also called Liquidity Program

When a company buys back vested stock options from employees for cash, giving them liquidity before an exit. Increasingly common in India as a way to reward early team members.

Why it matters

ESOP buybacks turn paper equity into real money for employees who might otherwise wait years for an exit, which strengthens retention and trust. Running periodic buybacks has become a meaningful part of how Indian startups honor their ESOPs.

For example

An Indian startup runs an ESOP buyback, purchasing vested options from long-tenured employees for cash, giving them real liquidity years before an exit.

Related terms

ESOP Vesting Secondary Sale

Go deeper

See how founders actually handle this on Co-founders, team and legal, part of the Starting Up hub.

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