Flipkart CEO responds to our cover story

Forbes India editor responds to Flipkart CEOs mail raising concerns over our cover story on their company

Indrajit Gupta
Published: 25, Jun 2012

Sachin Bansal, the CEO of Flipkart, wrote to me over the weekend reacting to our cover story on the company. What he wrote to me is re-produced below ad verbatim. My response follows after his note.

Dear Indrajit,

The timing of the mail may be awkward, given that we're on that unfortunate cover story of Forbes this week, but could I please take a few minutes of your time in sharing my views on the story?

In the context of this letter, I'd not like to offer views on Rohin's assumptions on our business model, our core value of customer obsession or funding - as a seasoned journalist, he has every right to question and offer his opinions on those factors. Instead, let me focus only on one part of the story that I personally found disconcerting - our culture.

When we agreed to speak to Rohin for this story, we had a very different picture of what it was possibly about. Rohin has spoken to 6 people within Flipkart and has also met Binny, Karan and Ravi for a second time.

Some of the more contentious parts of the story refer to some sort of a power struggle within Flipkart. I'm surprised that our views on the company's work culture were not included when alleging that something is wrong with it. Considering the story talks about 'banding together as a secretive bunch', as alleged by an ex-employee (who incidentally may have a vested interest given his association with another e-commerce firm, a fact ignored in the Forbes story), I'm saddened that our views on the work culture, across Rohin's meetings with our people have not been given any weightage at all.

For instance, my colleague, Mekin Maheswari, spoke about the very high sense of ownership and gave practical examples like our warehouse software being built by engineers who then go to the warehouse and try it out to see if it affects the shipping process. Or the other example where he talks about us hiring generalists who look at our processes from end-to-end before it goes to specialists for fine tuning.

When Rohin spoke with Sameer, our digital head, he spoke about Flipkart being a bold place to work, with everyone liking a good challenge at work. He also referred to the deep-rooted integrity across levels, at Flipkart, as one of the things that impressed him with our work culture. Not just that... the ability to make decisions and delegating decision-making are an interactive process, and not top-down, is something Sameer also shared with Rohin.

I am left wondering why these long interviews with our people talking about work culture wouldn't be appropriate in the story. Right now, it somehow seems to give inordinate weightage to outsiders' views on the same. Is it Forbes and Rohin's assumption that anything positive uttered by current employees can be completely discounted? In fact, the entire story does not quote a single employee when it comes to work culture. Isn't it a tad unfair? I can fully understand that work culture is a nebulous term and every person will have a different view on it, depending on who you ask. But wouldn't it be reasonable for me to assume that when an esteemed publication like Forbes is making allegations of an unfavorable work culture at Flipkart, it also quotes perspectives from current employees?

In a similar vein, Rohin could have simply asked us for details on the number of people from IITs, IIT Delhi or IIT Delhi's Jwalamukhi hostel vis-a-vis people who are outside this so-called circle. I can list at least 6 people (off my head, there are more, I'm sure) in the management team who are not from IIT Delhi or Jwalamukhi hostel. Wouldn't it be fair to include such a list and let readers compare if there was favoritism to IIT Delhi?

Beyond culture, the only other concern I'd like to point to is the seemingly feeble attempt at disclosing the Homeshop18 connection. It is added as a disclosure while talking about competition - and that indeed seems fair. But given the magnitude of the allegation (a cover story, with an apocalyptic headline, no less!), wouldn't a more prominent disclosure be appropriate to let people make their own judgements?

Finally, I'd also like to highlight something rather simple and inconsequential. Your last cover story on Future Group got promoted on Twitter 4 times. The one prior to that - on BRIC countries - got 3 tweets as promotion. The Flipkart story, in less than 24 hours, has got 8 tweets from the Forbes India Twitter handle. I do understand that Forbes has a print issue to sell and that a Flipkart cover is good fodder for sales, but considering the story will go online next Friday, do we expect further unusually high level of Twitter push on the same? Could I please request that the moderation in promotion displayed by Forbes India on its other cover stories be applied to us too?

If you find it appropriate, could I please request you to carry this response of mine in the Forbes blog? We agreed to speak to Rohin based on a specific angle that was communicated to us. Considering that the actual story is a lot different, the least we could request is this response from us be carried in a Forbes India-owned platform - print and online, or at least online, since print editions tend to have much shorter life spans in these days of digital domination.

Best regards,

Sachin Bansal CEO - Flipkart.com

My Response to Sachin Bansal:

Dear Sachin,

Thank you for your email. I appreciate the fact that you've reached out to share your candid views on our cover story about Flipkart.

First of all, let me share some important background and context to put things into perspective. Before any feature story is published in Forbes India, we speak to many people, both inside and outside the company, before coming to any conclusion.

At times, the initial hypothesis we start with changes as the reporting gathers momentum. If something controversial comes up, as a matter of policy, we flag the people off who are part of the feature. This protocol was adhered to by Rohin and he got in touch with you, Karthik (Sreenivasan, your head of corporate communications), and your senior team.

As you've acknowledged in your email, Rohin spent several hours with your senior team. In the first session with you, your co-founder Binny (Bansal) and the CFO Karandeep (Singh), he raised all the key issues with you. But you chose not to give clear, direct answers. Soon after the meeting, Rohin communicated his concerns to Karthik. On his part, Karthik agreed with Rohin's concerns and added that Karandeep too felt the meeting was very formal and defensive.

On his part, Rohin could have chosen to go ahead and write the story based on this meeting. Instead, because his concerns were serious ones, he took the initiative, asked for another meeting and raised the issues once again. But this time too, you ignored or provided vague answers to pointed questions around culture, investor conflicts, cost pressures or the reasons behind the series of senior exits in 2010. This, in spite of putting all of what he had gathered from his conversations with various people on the table. Although the meeting was cordial and friendly, fact is, most of his questions were not answered clearly or sincerely. He gave that feedback directly to Binny, Karandeep and Ravi both during the meeting, and subsequently to Karthik over the phone.

I think it is, therefore, unfair to suggest he did not put enough effort to understand your team's perspective.

Now, around the specific arguments in our story. One of the key arguments he made was that decision-making at Flipkart is centralised and vests with a core group of people, all of whom share similar backgrounds that date back to their IIT-D days. This is also linked to the exodus of the first batch of senior professionals in the story.

This view wasn't based on a conversation with "one key employee" as you seem to suggest in your email. There were others, who chose to speak off-the-record.

Then there is Tapan Kumar Das, the ex-employee you refer to. His primary business Qua Nutrition (of which he is CEO), does not compete directly with Flipkart. His being involved with other websites that very few have heard of is, frankly, something I thought would be insignificant to Flipkart given Binny’s comment to Rohin during an interview saying “we don’t look at competition now, and our only growth hypothesis is to get more customers to shop with us”. I understand Das’ perspective isn't exactly flattering, given that he was the first to raise legitimate doubts about the veracity of Flipkart's financial statements (which you haven’t refuted). And there is no material evidence to question his integrity.

One of the points that came through repeatedly in Rohin’s conversations was that these professionals found it extremely hard to break into the inner circle.

As anyone who has covered start ups and organisations for many years would know, there are many factors that influence work culture. In Flipkart's case, we found the dominant one was shaped, to a large extent, by the initial set of people, many of whom come from the same academic background. I understand it may be difficult for either you or your colleagues to accept allegations of a ‘ghetto’ culture. But when people who chose to leave Flipkart brought it up independently during our conversations with them, we thought its difficult to ignore their version. To my mind, there is an element of some reality in there.

I'm afraid you've read too much into the social media activity around our cover story. There's nothing unusual about the number of tweets. The only new feature we've introduced from this edition--a video blog--will now be a regular addition to our bouquet of digital activities. Incidentally, the first video that highlights key stories in any particular issue was aired on our website was the one that featured the Future Group. My colleague Dinesh Krishnan posted a blog as well on what went behind-the-scenes to conceptualise and design the cover image on Flipkart. This is something we've done in the past as well.

Readers familiar with our body of work since we launched three years ago know we follow a policy of making clear disclosures in our stories. Which is why, Rohin highlighted Forbes India's connection to Homeshop18. I understand you think the disclosure ought to have been highlighted more prominently. But what we have done is in line with our policy. And please understand, we believe our readers are intelligent to draw their own conclusions from the vast body of research presented in the story.

Finally, we will most certainly carry your letter prominently on our site, blogs and social media platforms like Twitter and Facebook, where we are very active, with my response appended.

Thank you once again for writing to us. I wish you and your team all the very best!

Regards,

Indrajit Gupta

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