Sachin Bansal takes over as executive chairman, to represent the company in external forums, interact with investors
After Wipro, it is now the turn of another Bengaluru based company to rejig its top management structure. On Monday e-commerce giant Flipkart announced the appointment of Binny Bansal as its new CEO, elevating Sachin Bansal as its executive chairman.
In an internal email to Flipkart employees which FE has reviewed, Sachin Bansal wrote, “We want to prove that India can produce a world class internet company that can outshine and outclass any global behemoth. Today, we are in a very strong leadership position with over 60% market share of the mobile commerce market, 50 million customers and clear leadership in smart phones and fashion,” said Binny Bansal, CEO, Flipkart.
There is a tremendous heat on Flipkart, thanks to Amazon’s strong showing of late. According to internet analytics firm comScore, Amazon India saw over 200 million visitors on its web and mobile sites in October. For the same period, Flipkart saw 164 million visitors on its web and mobile sites combined, while Snapdeal saw 109 million visitors. Two of its main entities Flipkart India and Flipkart Internet incurred a loss of Rs 2,000 crore in the year ended March 2015, according to the filings with the Registrar of Companies.
“In my role as executive chairman of Flipkart, I will play an active role in championing the Indian e-commerce sector and building the internet ecosystem, and represent the company in external forums. I will be actively interacting with investors, partners and other stakeholders, while helping to build India’s internet and commerce ecosystem,” said Sachin Bansal in an internal email. Mukesh Bansal will continue to be the head of commerce platform with the added responsibility of its advertisement business.
“Amazon has actually eaten away a lot of market share of Flipkart and it doesn’t seem that Flipkart is in a commendable position as compared to Amazon. Snapdeal, while giving huge competition to Flipkart, is also eating into its business. If you look at the last round of [Flipkart], it was a flat round. The company doesn’t seem to be doing that well the way it did in 2014,” said a venture capital source, who did not wish to be named.
So far Flipkart has raised $3.4 billion at valuation of $15 billion in 12 rounds from 16 investors. Unlike 2014, when the company went on to raise $1.91 billion its largest in a year, last year was dull. In just one round of investment in the whole of 2015 where it managed to secure $700 million from Tiger Global and other existing investors.