Employee benefits have quietly become one of the fastest-growing expense categories in the Indian startup ecosystem. As companies mature, salaries, bonuses, ESOP buybacks, insurance coverages, training budgets, and retention programs are no longer treated as “costs.” They are investments in long-term growth. The FY25 data published by Inc42 highlights this shift clearly, showing which startups prioritised their workforce even during uncertain economic conditions. In this blog, we break down the ten startups that spent the most on employee benefits in FY25 and examine what this trend means for the future of Indian tech, hiring, talent retention, and organisational culture.
Flipkart tops the list with an employee benefit spend of ₹4,748.8 crore. As one of India’s largest e-commerce companies, Flipkart employs tens of thousands across technology, corporate, warehousing, and last-mile operations. High spending here reflects not just salaries, but also ESOP buybacks, employee wellness programs, leadership compensation, and retention bonuses. With the competition intensifying from Amazon and Reliance Retail, Flipkart’s investment in people shows a strong focus on stability and long-term culture building. It also reflects the reality that attracting experienced engineering talent in e-commerce has become extremely competitive.
PhonePe follows closely with ₹4,096.7 crore spent on employee benefits. As one of India’s leading fintech players, PhonePe is aggressively expanding across UPI payments, insurance, merchant services, and financial products. These verticals require specialist manpower such as financial analysts, compliance teams, product experts, and senior engineers. PhonePe’s large employee benefit costs also signal significant ESOP-related expenses after its corporate separation from Flipkart. The company is positioning itself as a long-term home for tech and product talent, which is critical as the fintech space becomes more crowded and regulated.
In third place is Paytm with ₹3,288.1 crore. Despite operating in a challenging regulatory environment, Paytm has maintained high spending on its workforce. Much of this goes toward compliance teams, engineering talent, lending operations, and ESOP liabilities from previous growth cycles. Paytm’s numbers also show that the company is actively focused on preserving team stability during a transition period. For a large financial services company, retaining domain experts and product leaders is essential, especially when the external environment is shifting quickly. Their spending signals a strong commitment to workforce continuity.
Eternal, with ₹2,558 crore, may be lesser-known to the general public, but its employee spending shows it is scaling quickly, likely in a tech-driven or healthcare-driven direction. High spending here comes from aggressive hiring in engineering, deep tech, and possibly biotech divisions. Companies in these sectors usually offer high salaries and long-term equity-based compensation. Eternal’s number is an indicator that startups beyond the typical e-commerce or fintech space are also investing heavily in people-centric growth.
Shadowfax takes the fifth spot with ₹2,508.5 crore in employee benefit spending. As a logistics and last-mile delivery startup, Shadowfax manages a mix of full-time staff and large gig-workforces. Their employee spending includes insurance coverage for delivery personnel, safety programs, performance incentives, and benefits for full-time staff working in operations and technology. With the rise of quick commerce and e-commerce logistics, retaining delivery partners and improving their working conditions is becoming important. Shadowfax’s investment reflects a growing shift where gig-economy companies are beginning to formalize workforce support and take responsibility for better pay structures.
Sixth on the list is Fractal, with ₹2,004.6 crore. As a global AI and analytics company, Fractal relies heavily on highly-skilled data scientists, AI researchers, technical consultants, and domain specialists. These roles demand premium salaries, continuous training, and global exposure. The company also invests heavily in upskilling programs and internal certifications, which contribute to its benefit expenditure. Fractal’s spending is a sign that AI-focused companies understand that talent—not just models and algorithms—is their strongest competitive advantage. Retaining top-tier data talent is difficult, so high employee spending is strategic, not optional.
PB Fintech, the parent company of PolicyBazaar and PaisaBazaar, comes next with ₹1,958.6 crore. The company operates at the intersection of insurance, financial advisory, and customer support, requiring a large workforce of trained advisors, call-center teams, and product managers. Insurance is a heavily regulated sector, so employee training and certification form a major part of operational costs. The company also has ESOP obligations from earlier growth stages, which adds to the benefit numbers. PB Fintech’s spending shows that consumer financial services companies have to balance technology investments with large human teams.
In eighth place is Physics Wallah with ₹1,401.2 crore. The edtech company has scaled rapidly, onboarding hundreds of educators, teaching assistants, curriculum specialists, and tech professionals. Spending is driven by faculty salaries, performance incentives, hybrid teaching setups, and retention bonuses for top-performing educators. Edtech companies that continue investing in talent are more likely to survive long-term, and Physics Wallah’s spending is a strong signal of maturity in an industry that saw major ups and downs.
Lenskart, with ₹1,378.7 crore, takes the ninth spot. The company operates both retail stores and online platforms, which means their workforce includes optometrists, retail executives, store managers, supply chain staff, and a growing technology team. Lenskart also invests heavily in staff training and skill development, especially for optical professionals. Their spending shows that as retail moves toward omni-channel models, human expertise—especially frontline staff—remains central to customer experience.
Finally, Delhivery rounds off the list with ₹1,375.9 crore. As one of India’s largest logistics companies, its workforce includes warehouse staff, delivery personnel, operations teams, and tech engineers working on automation and route optimization. High employee spending reflects the company’s commitment to safety programs, insurance, seasonal workforce incentives, and digital transformation teams. In logistics, operational efficiency depends heavily on a skilled workforce, so Delhivery’s spending shows a strategic approach to sustaining its network at scale.
When we look at the entire list together, some clear trends emerge. ESOP-related expenses are becoming a major part of employee benefit spending, showing that Indian startups are slowly moving toward global equity-driven compensation structures. Logistics and gig-focused companies are investing more in frontline workers, a shift that was long overdue. Fintech and AI companies continue to spend heavily on premium talent because they depend on deep domain expertise. Edtech and retail-tech companies are also prioritizing staff development to ensure consistent user experience.
For job seekers, these numbers highlight which sectors and companies are prioritizing talent retention and offering competitive compensation. Candidates today look beyond base salaries and want long-term value in the form of ESOPs, insurance, flexible policies, career growth, and wellness programs. These companies show a genuine commitment to those expectations.
For founders and HR leaders, the message is simple: employee benefits are no longer optional. They are part of a company’s brand, culture, and ability to attract top talent. Investing early in people-centric policies creates a more stable, loyal, and productive workforce. It also improves a company’s long-term valuation and reduces the hidden costs of attrition.
The FY25 data reinforces one major insight: the Indian startup ecosystem is entering a more mature phase. Companies are no longer running purely on rapid expansion. They are building stronger teams, formal HR structures, wellness programs, and long-term equity plans. These ten companies stand out for understanding that people power growth—and in FY25, they backed that belief with real investment.
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