Edtech company Unacademy has amended its employee stock option (ESOP) scheme, sharply reducing the window for former employees to exercise vested stock options to 30 days—from a period of up to 10 years earlier—according to an email sent to ex-employees, shared on social media platform X.
The email, sent by Qapita Liquidity on behalf of Sorting Hat Technologies, Unacademy’s parent entity, said this was part of an amendment to the company’s 2018 ESOP plan.
Under the revised terms, employees whose engagement with the company has ended must exercise their vested options within 30 days of cessation. To align employees who have exited with current staff, the board has provided a one-time 30-day exercise window from the effective date of the amended scheme, after which unexercised options will lapse.
The communication warned that exercising the options would trigger an immediate tax liability under Indian tax laws and noted that the valuation for ESOP exercise purposes is based on the company’s latest merchant banker-led valuation of about Rs 2,650 crore (about $295 million at current exchange rate), as cited in the email.
This marks a sharp contrast with Unacademy’s peak valuation of about $3.5 billion during the pandemic-era funding boom, when the company raised large rounds from investors including SoftBank.
The email also highlighted that shares in the private company are illiquid and that preference shareholders have priority over equity holders in the event of a liquidation, with no guarantee of payouts to equity shareholders.
The amendment forces former employees to either fund the cost of exercising options and pay associated taxes within a short period or forfeit vested options entirely, a departure from the earlier framework that allowed long-term holding. The email described the change as a one-time opportunity for employees who have exited to achieve parity with existing shareholders by converting options into equity.
The development comes at a time when Unacademy is exploring a potential sale amid a prolonged downturn in the edtech sector.
Earlier this month, Unacademy Founder and CEO Gaurav Munjalsaid in a post on X that the company is in discussions for potential mergers and acquisitions, adding that it would pursue consolidation if it resulted in a stronger combined entity.
Munjal said the company’s decade-long journey included a sharp reset after the pandemic-driven surge, as demand normalised and investor focus shifted towards profitability and cash preservation.
The SoftBank-backed company had held acquisition talks last year with Allen Career Institute at a valuation of about $800 million, which fell through over valuation differences. More recently, upGradheld discussions with Unacademy’s investors and founders at a valuation of around $300 million to $320 million, nearly 90% lower than the company’s last private valuation, as reported by YourStory earlier.
Source – https://yourstory.com/2025/12/unacademy-cuts-esop-exercise-window-for-ex-employees-to-30-days