Top bosses exit as Flipkart scrambles to save sinking ship

Flipkart, in a not-so-surprising move, announced its new CEO - Kalyan Krishnamurthy. He has replaced Binny Bansal, who had replaced the then CEO Sachin Bansal last year. Yes, frequent restructuring has been hinting at problems at India's most promising startup.

 

An ET report, just after the appointment of the new CEO, points out three top-level executives exit the company. This comes when Krishnamurthy is building his own team, which reportedly consists of company veterans. With veterans in, these three executives who had joined the company in 2015 are ready to leave.

 

Saikiran Krishnamurthy, chief of supply chain unit Ekart along with Senior VP, Product Surojit Chatterjee, and the chief marketing officer Samardeep Subandh. All three hires were made when Flipkart began aggressively hiring after raising more than $2.6 billion in funding back in 2014-2015. Today, after multiple markdowns and eroding company value, Flipkart is trying to curb losses and combat arch-rival Amazon.

 

Also Read: Flipkart has a new CEO! Who replaced Binny Bansal and why?

 

In fact, the inability to do so has been making it difficult for the company to raise fresh funds at the desired valuation. If reports are to be believed large investors such as Walmart have refused to invest in the company as they couldn't settle on a price. Ekart Logistics that was incorporated in 2015 has incurred losses of Rs 810 crore on a revenue of Rs 303 crore in the first nine months of its operation ended March, reported Business Standard. Binny Bansal is believed to have been betting on logistics to expand into newer areas, which in turn would help offset losses.

 

Now, with Krishnamurthy at the driver’s seat, he will oversee Ekart. In fact, it is believed that Kalyan was anyway running the show. A recent Livemint report pointed out that its largest investor Tiger Global and Lee Fixel 'are in the driver's seat'.

 

Flipkart, the pioneer in Indian ecommerce space, hasn't been in the best of shape. The problems became more prominent last year when it was marred by wrong decisions, layoffs, reshuffling of top management and some big exits. Last year, Flipkart lost its top position to arch-rival Amazon. By November 2016, Flipkart saw almost four markdowns in 9 months. The last we saw Morgan Stanley slash Flipkart value by 38% to $5.58 billion.

 

Krishnamurthy has been seen as someone who can help revive the company. He is said to have been instrumental at implementing the winning Big Billion days Sale, and his appointment comes just when Flipkart is looking for a fresh round of funding.