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Coimbatore startup distributes ₹14.5 crore between 140 employees, founder explains why
A Coimbatore startup has distributed ₹14.5 crore between 140 employees as a reward for their loyalty.
A Coimbatore startup has distributed ₹14.5 crore between 140 employees as a reward for their loyalty. Kovai.co, a Coimbatore-based SaaS firm, is earning plaudits on social media for basing its bonuses on loyalty rather than performance.
According to CNBC, Kovai was founded by Saravanakumar, a 48-year-old entrepreneur who belongs to Coimbatore but moved to London 25 years ago. Saravanakumar came up with the idea of launching his own AI business when he saw a gap in the market and decided to fill it himself.
He scaled Kovai.co as a completely bootstrapped startup whose annual revenue today stands at $15 million. Its total valuation is around $100 million.
A reward of ₹14.5 crore
The company recently gave ₹14.5 crore to its long-term employees as a way to recognise and reward their loyalty. The bonus was given as part of Kovai’s “Together We Grow” initiative. Under the initiative, which was announced in 2022, employees who stayed with the company for three years would receive a six months’ salary as bonus.
“Why do people work in startups? They hope to become rich, but in most startups, employees get shares, which are only on paper. I thought of giving something concrete to my employees. Three years ago, I said that if they stay with us, they will get a bonus equal to six months’ salary in January 2025,” Saravanakumar explained.
“I chose not to announce ESOPs because they are essentially paper money until a company takes external funding or goes for an IPO,” he said. “I also decided not to tie it to performance or targets but kept it simple-a bonus for those who stayed with us for three years.”
Employees express happiness
In a post published on the Kovai website, the SaaS startup wrote: “Last Friday was an extremely special day for all of us at Kovai.co as we witnessed 80 long-term employees receiving well-earned bonuses. For many, this significant lump sum represented a moment of gratitude, pride, and achievement.”
Many employees of the firm said they would use the money to pay off loans. Others said it would help fund their children’s education or their own weddings.
