Croatian Company Infobip, First Domestic Unicorn, Has Most Shareholders

Lauren Simmonds

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As Novac/Bernard Ivezic writes, the Croatian company Infobip has moved one step closer to the stock market. It is no longer just the first Croatian unicorn and the largest domestic startup to date, but also the one with the most shareholders of all. Infobip has also now launched its own ESOP programme for all of its employees, more than 3300 of them.

This impressive cloud communications company has announced that it will automatically apply the employee shareholder programme to all of its future employees.

Silvio Kutic, the co-founder and CEO of the Croatian company Infobip, says that ESOP is the most important initiative that rewards employees for their contribution to the evolution of the company through compensation in addition to their salaries.

”ESOP is a key part of the value offer of employees and that’s why it’s my honour to have the privilege to state that we’ve reached the point where we can make all employees part of our story of growth as shareholders,” explained Kutic.

The Croatian company Infobip has had an ESOP before, but it’s questionable as to whether it can be called that given the fact that it was very limited in scope. It was valid only for individual, key employees, estimated to number about 800. Now, however, the programme has become a company-wide standard and has included an additional 2,500 employees.

ESOP (Employee Stock Ownership Plan) is a programme by which companies add the option of acquiring an ownership share to employees’ salaries. It is used as a form of reward and a tool for retaining staff.

Although one of Podravka’s is considered to be one of the most successful ESOP programmes in all of Croatia, this type of employee reward programme is currently the most popular in the entire IT industry. According to a survey which was conducted last year, as many as thirty domestic IT companies have embarked on various ESOP programmes. Infobip was the first to do so, followed by Nanobit, while Rimac Automobili announced that they were moving in that direction as well.

Nanobit also made an ESOP but also of a limited scope. As was learned last year, Nanobit allocated 5.57 percent of the ownership stake to 30 percent of the company’s employees. The programme, as Alan Sumina, the co-founder and CEO of Nanobit, explained at the time, rewarded people who proved to be key to the company’s growth as well as a motive for attracting potential staff from elsewhere to come and work for the company, especially in the City of Zagreb.

For the listed companies, the option to acquire an equity stake is usually activated in preparation for the IPO. The Croatian company Infobip is planning its IPO for the end of 2022, ie the beginning of 2023. Then, just before being listed on the stock exchange, employees can convert their options into ownership shares and thus become “real” shareholders of the company after the IPO, meaning that they can then sell the shares they have thus acquired and thus generate additional income.

It should be emphasised that there are numerous variations of the ESOP programme, and some companies share such options with their employees, while some, as is the case with the IT company Span, which recently went public on the Zagreb Stock Exchange, have offered their employees the option to purchase shares on preferential terms. Regardless of which ESOP implementation model both companies and employees have chosen, this is a more tax-profitable way of increasing additional income in Croatia.

From Infobip, they explained that their ESOP plan is designed as an addition to the current employee compensation packages, and this means that it is the so-called optional ESOP model. Infobip launched the programme four years ago and back at that time, a 10 percent stake in the company was allocated to reward employees, but the entire package was not distributed at the time, as the ESOP was applied to a limited extent.

Kutic explained that this is a confirmation that the organisation is now in the next phase of the path of exponential growth, and if we quickly recall, it’s worth noting that Infobip’s revenue jumped 57 percent last year to 1.25 billion dollars or 7.74 billion kuna.

After receiving a 300 million US dollar investment from the US fund One Equity Partners in 2020 and taking over OpenMarket for that same sum, this year it bought the Split conference franchise Shift, and then the world’s leading SMS firewall service provider, the Irish Anam Technologies. The value of these transactions hasn’t yet been disclosed.

Recently, the Croatian company Infobip also took out a 500 million dollar loan from funds managed by Ares Management Corporation and funds managed by BlackRock, it also took over one of the largest alternative telecoms in the USA, Peerless Network. The company has made it clear that it will continue to take over and merge with others in the coming period.

”Our goal is to ensure that everyone is fully active in the implementation of our ambitious growth plan that we intend to carry out over the next few years, because in this way, employees will create value not only for the organisation but also for themselves as individuals,” concluded Silvio Kutic.

For more, check out our dedicated business section.


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