How Unacademy board tweaked targets for founders’ voting rights

economictimes.indiatimes.com:

Unacademy has changed the goals for its two cofounders, Gaurav Munjal and Hemesh Singh, to access additional voting rights through bonus shares issued to them in 2022.

According to Unacademy’s filings with the Registrar of Companies (RoC), Munjal and Singh will get access to additional voting rights if the company forms a committee by March 2025 to work on its initial public offering.

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As per the original terms approved by the Bengaluru-based company’s board in May 2022, the milestone was to raise $200 million within three years of the bonus issue.

Industry sources said this move throws light on Unacademy’s changing ambitions as well as the broader sluggishness in startup funding.

As part of the bonus issue exercise that Unacademy undertook in May 2022, Munjal and Singh were issued a separate class of preference shares, which would convert into equity shares at a ratio of 1:8 – meaning for each preference share, the holder would get eight equity shares upon completion of three years.

However, Munjal and Singh – who were issued 6.5 million and 2.8 million preference shares of this class, respectively – would be eligible for a 1:15 conversion ratio if the company raised $200 million in funding within three years of the issue, as per the original terms.

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