The man credited behind the buyout is Kalyan Krishnamurthy, who became chief executive officer of Flipkart in January 2017, when outlook for the Indian online retailer was gloomy. Image source: Twitter
As the biggest-ever deal by a foreign buyer in India has been announced, people are eager to know who the man behind this mega buyout is and what has been his strategy to pave the way for a $16 billion investment from US retail giant Walmart Inc in Flipkart Group. The business deal is likely to help the Indian firm to compete against Amazon and Alibaba Group in the e-commerce market.
The man credited behind the buyout is Kalyan Krishnamurthy, who became chief executive officer of Flipkart in January 2017, when outlook for the Indian online retailer was gloomy. The startup’s valuation was dropping, fundraising was more difficult and Amazon.com Inc was pledging $5 billion-plus to siphon away customers, said a Bloomberg report.
Taking some risks, the 46-year-old former hedge-fund manager fired senior managers, set more-aggressive sales targets, boosted spending on promotions and promised to dominate India’s festival-season shopping. His strategy worked, and we can see the return in the mega deal. In India, online shopping is projected by Morgan Stanley to reach $200 billion within the next decade, compared with $30 billion now.
“His relentless focus and his aggressive execution changed Flipkart’s fortunes," Anil Kumar, CEO of RedSeer Consulting in Bengaluru, told Bloomberg, adding “He brought the edge that Flipkart was missing.’’
Krishnamurthy will remain CEO of Flipkart, Walmart said. The company, founded in 2007 by Binny Bansal and Sachin Bansal, is the most valuable of 10 unicorns in India, according to CB Insights, and backers have included Tiger Global Management, SoftBank Vision Fund, Tencent Holdings Ltd., EBay Inc. and Microsoft Corp, Bloomberg report said.
According to the report, Krishnamurthy spent seven years in eBay’s Asia finance operations before joining Tiger Global as its finance director in 2011. He first arrived at Flipkart in early 2013 as its interim chief financial officer to support the Bansals, who each spent time as CEO. They are not related.
Krishnamurthy reportedly started his tenure by trying to change the narrative from one of “deep-pocketed Amazon versus startup Flipkart’’ to one based on a homegrown operator. Setting goals for online traffic and sales, he streamlined operations and implemented what he called the “80-20 rule’’ –- focusing on the 20 percent of categories that generated 80 percent of Flipkart’s revenues, the report said.
India is a medley of income levels, languages and cultures –- a place Krishnamurthy describes as “several countries within a country." The report quotes Krishnamurthy as saying he wanted Flipkart to appeal to as wide a demographic as possible. Therefore, the company introduced round-the-clock customer service, offered demonstrations to first-time appliance buyers under his tutelage. Krishnamurthy sent technicians to typically small homes to mount TVs on the wall, and he reportedly himself answered customer-service calls.
Watch this Zee Business video
An ardent yoga practitioner, Krishnamurthy constantly sips water and bounds up and down the stairs at work. He is the father of two young daughters.
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