VCs Hijack Flipkart As Binny Bansal Replaced By Kalyan Krishnamurthy As The New CEO; Major Restructuring Announced!
Flipkart, the homegrown poster boy of Indian startups, the unicorn ecommerce portal which ignited a million other digital dreams, is again in news; albeit for a very different reason.
Binny Bansal, one of the co-founders, is no more a CEO of the company. He has been replaced by Kalyan Krishnamurthy, who can be described as a major representative of the Tiger Global, a venture capital fund which has invested the most in Flipkart.
Till yesterday, he was the Head – Category Design Organization within Flipkart, but from now on, he would be responsible for profit and loss of the company as the new CEO. Before coming on-board on Flipkart’s team, he was Managing Director of Tiger Global Management for two years and before that, he was Director – Finance at Tiger Global.
A new organizational structure has also been announced, and ex-CEO Binny Bansal has been ‘promoted’ as the Group Chief Executive Officer of this new structure.
In a statement, Binny Bansal said, “We are now ready to build the Flipkart of the future as we continue on our journey of transforming commerce in India through technology. I am confident that this new organisation structure will deliver further value for Flipkart group,”
The Legend of Bansals Fade in Flipkart
Within a year, this is the second major reshuffle in the management profiles of the company. Last year on January 12th, Sachin Bansal, another co-founder of Flipkart was replaced by Binny Bansal as the CEO.
This time, the reshuffling is a major one, as representatives from VC funds have completely taken over the Mother Ship, and on an operational level, there is no Bansal left to see through the company affairs.
In his new avatar as Group Chief Executive Officer, Binny Bansal will oversee “capital allocation across all the group companies, CEO selection and CEO compensation as well as to ensure each business is led by a strong CEO.”; or in other words, he has been given a honorary job title, which has little to do with actual operations of the ecommerce portal.
When Sachin Bansal was replaced as the CEO, he had been given the title of Executive Chairman.
A statement from the company made it absolutely clear who will run the show now:
“Kalyan Krishnamurthy, currently heading the Category Design Organisation, will become the CEO of Flipkart. Kalyan will be responsible for operationally driving Flipkart and will be responsible for Flipkart P&L”
The New Order Within Flipkart
In the new order of things, there are mainly three verticals are now: Flipkart, Jabong-Myntra and PhonePe.
While Ananth Narayanan will be the CEO of Myntra-Jabong; Sameer Nigam would head PhonePe as the CEO and Kalyan Krishnamurthy would be the CEO of Flipkart.
Nitin Sethi, who is the Chief Administrative Officer will be now COO of Flipkart, wherein he will manage Ekart, customer experience and HR operations. He would be reporting to Kalyan directly. Ravi Garikapati, who is heading the Engineering Division, will also report to Kalyan.
As per the new order, the management is now searching for a Group CFO, who will oversee all three verticals and a General Counsel, both of whom will report to Binny Bansal.
Is Performance A Reason For Removing Binny Bansal
Startup industry in India is buzzing with rumors, regarding the ‘ouster’ of Binny Bansal as the CEO, because CEO is the most important entity of a startup, and if a co-founder is replaced by representative from VCs, then questions are bound to arise.
Last year, when Sachin Bansal was replaced as the CEO, then he had come out openly, and had stated that performance was the reason he is being replaced.
During a meeting with staff members, he had said, “Look at the top level around you. Everyone has changed. In fact, even I am gone. Some of our targets have been missed and everyone, including the top management, has paid the price.”
Has Binny Bansal too paid the price of under-performance?
Do share your opinion on this major reshuffling inside Flipkart, by commenting right here!
