The Indian artificial intelligence-driven travel app, ixigo, has given its ixigems, as its employees are called, reason to celebrate amidst the economic disruptions created by the pandemic. Ixigo has not only reinstated their salaries but has also offered them ESOPs (employee stock ownership plan) at heavy discounts, to compensate for the pay cuts imposed on them in the last three months.
“Living up to the promises made to our employees, the announcement of giving out deeply discounted ESOPs, along with re-initiating the normal salary disbursal effective from July was a collective decision by the leaders. Our board and investors were supportive of our decision from the start, but we just got a formal sign-off from them on this plan yesterday, which is why we officially announced it,” reveals Aloke Bajpai, co- founder and CEO, ixigo, to HRKatha.
This move was made by the management, keeping in mind the welfare of all ixigems. The Company managed to stay afloat through the economic crisis caused by the pandemic, and was able to sustain without resorting to layoffs.
Shedding further light on the move, Bajpai discloses to HRKatha, that in the beginning of March itself the Company had anticipated a lockdown. “Therefore, we started working on a plan that would potentially allow us to survive even if revenues were to remain zero for three to six months. We evaluated several options, including layoffs. However, given the extraordinary times and considering the related challenges and the hardships it would bring upon our employees, we decided against downsizing. In consultation with our leadership, we came up with a Plan B, which involved slashing of salaries across teams, starting with the co-founders themselves, who immediately gave up their entire salaries. Our leadership team took a pay cut of over 60 per cent, graded by pay, and the rest of our workforce mutually agreed to a 20 per cent to 50 per cent pay cut depending upon the different compensation brackets,” explains Bajpai.
The net worth of the discounted ESOPs is yet to be revealed, but ixigo has disclosed that by granting these ESOPs, an additional 2.3 per cent of the Company’s overall shares will be held by its 150-strong workforce.
Unlike the usual industry practice, the vesting period of these stocks is just one year. Never before has the Company offered such heavily discounted ESOPs.
The travel app had posted a profitable beginning at the start of 2020, with almost 50 per cent jump in revenue, to the tune of Rs 160 cr for FY20. There was a significant reduction in operating losses, which fell to merely Rs 8 cr in FY20 from 40 cr in FY19.
According to a travel sentiment survey undertaken by ixigo recently, 68 per cent Indians are willing to travel amidst the pandemic. Latest trends indicate that the fear and apprehension related to COVID-19 are slowly dissolving, and travellers are learning to live with the virus. Naturally, ixigo’s hopes have been raised of a faster recovery of the travel sector than expected. Therefore, the app is now looking forward to an increase in bookings, and is hoping for pre-COVID level traffic.