Sachin Bansal says goodbye to Flipkart as Binny Bansal stays on
Binny Bansal and Kalyan Krishnamurthy will continue in their roles as Flipkart Group CEO and Flipkart CEO, respectively.
Needless to say, this is a pivotal moment in Indian startup history. The poster boy of the country’s startup ecosystem, ecommerce leader Flipkart has been acquired by US retail titan Walmart for $16 billion, making it the first successful exit for a startup unicorn.
With this development, Flipkart Co-founder and Executive Chairman Sachin Bansal will leave the company after selling his 5.5 percent stake for a reported $800 million-$1 billion. His Co-founder Binny Bansal, now Flipkart Group CEO, has decided to stay on, along with the current Flipkart CEO Kalyan Krishnamurthy.
Sachin wrote in a post on Facebook today:
In a way, this is a bittersweet moment. Sachin and Binny were the Jai-Veeru of Indian startup founders. They ignited the spirit of entrepreneurship among millions of Indians, and built a company of thousands of people with an entrepreneurial culture. But what was missing was what every business is supposed to do – make a profit.
Let’s rewind a little bit
Founder versus non-founder CEO has been a long-term debate. Mark Zuckerberg continues with Facebook, Jeff Bezos never left Amazon, and Jack Ma is still the face of Alibaba. But in investor-driven companies, experts agree, founders rarely call the shots.
It was in 2016 that Sachin became executive chairman, as Binny replaced him as CEO. A few months later, Kalyan Krishnamurthy, a senior executive from Flipkart’s largest investor, Tiger Global, who was interim CFO at the ecommerce giant in 2013-14, came back as head of category design.
Soon, he tightened the targets, and fired quite a few senior executives for poor performance - a move that apparently succeeded in ensuring that nobody remained laid back anymore. On January 9, 2017, Kalyan was declared Flipkart CEO - the first non-founder CEO of an Indian startup Unicorn, while Binny became Flipkart Group CEO.
Why Sachin bids adieu
With Walmart taking over, Sachin’s goodbye to the company makes one wonder if it was internal politics that led to the move. One industry observer says it could be Sachin not agreeing to Walmart’s terms that led to his exit.
Kalyan staying is no surprise to most. When you are a CEO and not a founder, you can take decisions dispassionately. There are fewer sentiments; exactly what Flipkart and Walmart would need now. Also, with Walmart entering the scene, profitability cannot wait anymore; IPO cannot be pushed farther.
More than personal compatibility with the individuals from Walmart, Sachin’s decision could be just one to move on too - after laying the foundation stone for ecommerce, inspiring a generation of entrepreneurs, and creating history.