How Sachin Bansal and Binny Bansal Made India Believe in Entrepreneurship
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When IIT Delhi college mates Sachin Bansal and Binny Bansal left their jobs at Amazon to start an online bookstore, little did they know that 11 years later, they would have global giant Walmart knocking at their doorstep.
On Wednesday evening, Indian entrepreneurs celebrated as they saw one of the biggest success stories of the startup ecosystem, get acquired by Walmart for $16 billion. Kunal Shah, founder of Freecharge, tweeted, “Today maybe the most important day for Indian tech startup ecosystem.” Meanwhile, founder of PayTM, Vijayshekhar Sharma wrote, “This is 1 Lakh crore+, all cash deal! I call it, perfect answer to those who were dismissive of Indian startups in an open-for-all market. What an incredible outcome for every believer of Flipkart.”
But the Flipkart story isn’t one just about their business revenues or their valuation. The Flipkart story is dear to all in the ecosystem because it’s the story of Indian entrepreneurship. From a 2BHK apartment to a sprawling 10 Lakh square feet campus in Bengaluru, Flipkart founders didn’t just live the entrepreneurial dream; instead they instilled that dream in many others.
Entrepreneur India takes a look at Flipkart, beyond the business.
Mothership of Startups
To an audience that refuted the online shopping concept because of trust issues, Flipkart made Indian customers believe in it with their cash on delivery option and return policy.
Flipkart made people believe in the Indian startup ecosystem believes Punit Soni, who had left his job at Google to be the Chief Product Officer at Flipkart. Soni now runs his own AI start-up Robin. “Flipkart's impact on the Indian startup ecosystem is tremendous. It created belief that a generation of Indians could build startups and scale them. It required a lot of grit, blood and sweat, and I suspect the biggest impact is that now folks believe a large internet startup can be build, scaled, and even exited,” he said.
Outside the doors of its building, it is a company that made e-commerce popular, but within the closed doors, Flipkart is a company that drove its employees towards innovation. So it comes as no surprise that its employees are today founders of their own start-ups. The origins of their entrepreneurial journey lies in learning from the Flipkart top honcho, working with them to launch products in a fast paced environment. In fact, according to reports, Flipkart’s alumni has gone on build over 200 startups.
For ex-Flipster Lalit Keshre, cofounder and CEO, Groww, it all began at Flipkart. “Flipkart is like a mothership of startups. The primary reason why so many startups come out of there is their DNA of customer obsession and big thinking. Flipkart makes one believe that it is possible to build something big in India,” he said.
Keshre started Flipkart Quick and owes it all to the entrepreneurial culture of Flipkart and encouragement from leaders like Binny. “We had the same experience when we launched the Flipkart marketplace – launching every product within Flipkart is like running a startup. And then there were big billion days - times when everyone within the company used to get together to make something big happen - it gives you a kick like nothing else,” said Keshre.
Flipkart’s success is what inspired others to start their own venture, believes Soni. “I do not believe that it is infrastructure and work environment of a company that creates a learning place for folks to want to start companies. It’s success. And Flipkart did succeed in its own right. That success is what triggered a whole generation of Indians starting companies,” he said.
Within Flipkart, There Was Always a War For a Common Win
Whether it was the times when they struggled to keep up the revenue or when the big billion sale went online, the atmosphere within Flipkart has always been one to strive against all odds. Keshre said that the environment at Flipkart is extremely energetic and fast-paced. “The speed of how things happen at Flipkart makes people almost used to it. Any feature launch or any category launch at Flipkart is almost a war-like effort by many people towards a common goal, with the clear set of values guiding all,” he said.
ESOPs Will Make Flipkart Employees Millionaires
Flipkart's acquisition by Walmart is nothing short of visionary. Kunal Shah, who founded Freecharge, went on to write a post on social media about how Indians need to applaud the ecosystem when an exit happens.
As a part of their sale, USD 500 million has been kept aside for employee stake buyouts, which is now sure to make some of Flipkart's employees millionnaires. According to reports, the ESOP (employee stock options) buyback from Walmart will be one of the biggest moves in the Indian startup ecosystem.
In its Sale Too, Lies a Learning For The Ecosystem
DR VK Vijayakumar, an industry expert believes that the journey of Flipkart from a 2 BHK online bookstore to Rs 20,000 crore turnover giant is indeed an inspiring story for startups in India.
But he also believes that there lies an important takeaway from the Flipkart story. The Bansals grew their company aided by foreign funding – from investors like Softbank, Tiger Global, Microsoft, Tencent etc. “The easy availability of foreign capital enabled Flipkart’s growth. But the restrictive regulatory environment in India such as restrictions on FDI in B2C retail, allowing only profit-making companies to make an IPO and list on the exchanges etc. constrained the growth of Flipkart forcing the company to move to Singapore for registration. There is a message here for Indian corporate law, which should be made more startup-friendly,” he said.