India's Most Celebrated Startup's Founder Steps Down on Alleged 'Serious Personal Misconduct'
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In a shock to the Indian startup ecosystem, India’s most celebrated startup Flipkart’s Group CEO Binny Bansal stepped down with immediate effect.
Serious personal misconduct allegation that were being investigated by Walmart led to his resignation.
Walmart Inc, which recently acquired Bengaluru-headquartered Flipkart in a $16 billion deal, issued a joint press statement that announced the resignation of Binny Bansal as CEO of Flipkart.
The company said Binny Bansal had been contemplating a transition for some time and that the companies had been working together on a succession plan, which had now been accelerated.
“Binny has been an important part of Flipkart since co-founding the company, but recent events risked becoming a distraction, Binny has made a decision to step down,” the statement said.
The note detailed that going forward; Kalyan Krishnamurthy will continue to be CEO of Flipkart, which will now include Myntra and Jabong, continuing to operate as separate platforms within the Flipkart business.
“His decision follows an independent investigation done on behalf of Flipkart and Walmart into an allegation of serious personal misconduct,” Walmart said in a press statement. “He strongly denies the allegation. Nevertheless, we had a responsibility to ensure the investigation was deliberate and thorough.”
The company said “while the investigation did not find evidence to corroborate the complainant’s assertions against Bansal, it did reveal other lapses in judgment, particularly a lack of transparency, related to how Binny responded to the situation. Because of this, we have accepted his decision to resign.”
The Walmart and Flipkart’s press note did not detail the nature of the alleged personal misconduct and who made the allegations.
The company is now going to be steered without its founders, the Bansals. Ananth Narayanan will continue as CEO of Myntra and Jabong and will report to Kalyan. Sameer Nigam will continue leading PhonePe as CEO. Kalyan Krishnamurthy and Nigam will both report directly to the board.
Sachin Bansal had left at the time of Walmart’s acquisition of Flipkart.
Binny Bansal who served as CEO of Flipkart is among Indian’s first billionaire Internet entrepreneurs. He started Flipkart in 2007 with Sachin Bansal. Before co-founding Flipkart, Binny Bansal was employed by Amazon for nine months, and before that was rejected by Google twice.
Flipkart initially focused on book sales, before expanding into other product categories such as consumer electronics, fashion, and lifestyle products. In 11 years, it transitioned to become India’s most popular home-grown online store for mobiles, fashion, electronics, home appliances, books, jewelry, home, furniture, sporting goods and beauty.
Walmart’s acquisition of Flipkart has been the company’s largest-ever acquisition and has been viewed as a robust move in its efforts to combat competition from global leader Amazon. Flipkart’s smaller domestic peers include Snapdeal, Paytm Mall and Shopclues.
The exit of Binny Bansal, however, will not mar the company's plans to list itself. Walmart in its statement said it remains committed to investing in the long-term and is supportive of the leadership team's desire to evolve into a publicly-traded company in the future.