Mukesh Bansal’s exit from Flipkart hasn't come as a surprise to analysts and industry experts, who closely track the ecommerce sector. On Wednesday, Bansal, head of commerce platform and advertising business at Flipkart— which is valued at $15 billion—resigned exactly a month after the ecommerce giant named its co-founder Binny Bansal as its new CEO. Both the Bansals aren't related. In fact, Binny’s rise to the top job is believed to have set in motion a slew of changes at Flipkart, which are starting to unravel now.
“It was inevitable that Mukesh (Bansal) would move out of Flipkart at some point. Everybody knew that Flipkart wouldn’t be able to keep him for long. He (Mukesh) could have left on the day the deal (Myntra acquisition) happened or within few months. But they (Flipkart) managed to keep him for close to two years. It has been managed very smartly,” said Harminder Sahni, founder and managing director of Wazir Advisors, a retail consulting firm.
Sahni adds: “Mukesh is smart, enterprising and successful. He wouldn’t have continued for too long at Flipkart for a little stake and a second fiddle to the top guys.”
Flipkart had acquired Mukesh Bansal-founded Myntra in May 2014, in what is the biggest M&A deal in the Indian ecommerce industry, for an estimated price of about $330 million. Post the takeover, Mukesh became part of the Flipkart top leadership and continued to spearhead the growth of Myntra, which continues to retain its own brand identity.
An IIT-Kanpur graduate, Mukesh Bansal wanted to start his own business since his college days. Prior to launching Myntra, in 2007, Mukesh had worked with four Silicon Valley startups in the ecommerce and software space where he picked up the nuances of running a successful business.
Along with Mukesh Bansal, Flipkart also lost another top executive, Ankit Nagori, who was the chief business officer at the Bengaluru-based ecommerce firm. According to media reports, Nagori will exit the company by May while Mukesh Bansal would leave Flipkart by April.
With Mukesh exiting Flipkart—with plans of starting a new venture— would his flock at Myntra move along with him, is the question some analysts are asking. Sahni believes there won’t be too much of attrition at Myntra. “I don’t see any tsunami of exits happening. In the last one-and-a-half year, Mukesh (Bansal) also moved away from Myntra because of his other engagements in the organisation. Employees knew that he is in the system, but they didn’t interact with him everyday. They got used to the structure,” said Sahni.
At present, Myntra is the clear leader in the ecommerce fashion category, even as Amazon is beefing up its play in the space. However, some are of the opinion that Mukesh’s exit could have a short-term impact. “He (Mukesh) was the founder and vision holder,” says Rajesh Gopal, director, digital engagement, Vertebrand, a Bengaluru-based brand value advisory and marketing consultancy firm.
“It seems that the exit was under discussion for a few months now. So I’m assuming a back-up plan was already in place. Flipkart has been able to hire good talent and hence it would be safe to assume that there is a strong second line of leadership that has been groomed,” Gopal added.