It has not been a great year for Flipkart so far. Markdowns by investors, constant struggle to retain leadership in the market thanks to fierce competition from an aggressive Amazon and failure to retain top talent internally—India's largest ecommerce firm has been facing its demons.
To add it to woes, Bengaluru-based Flipkart's chief financial officer Sanjay Baweja quit amid the festive season, which is a crucial period for ecommerce companies.
In a chat with Techcircle, Baweja speaks about the reasons behind his decision to quit the ecommerce major, Flipkart's financial position and much more. Edited excerpts:
Are you satisfied with Flipkart's financial performance?
It was something that I thoroughly enjoyed. As a team, we have really expanded. Because the focus has been on acquiring customers, we have innovated all across. Be it low-cost EMIs or product exchanges, all that was because we were customer centric. Everything else took a back seat and ruthless execution helped in a big way. I am really proud to have been part of this. Financially, we are much better than what we were. We have a substantial amount of cash and a very strong run rate. Secondly, from a financial profitability (angle), if you look at numbers six months ago and now, there has been a substantial positive move. These two years have been great in terms of value and volume growth, profitability improvement and overall cash availability.
Was resignation a tough decision for you?
All decisions where you leave things are not easy. I am a relationship guy. Therefore, there is the pain of leaving behind your people.
There have been media reports of an impending investment by Walmart in Flipkart and Flipkart seems to be in the middle of a fundraise. Also, this is the festive season which is important for ecommerce companies. Why exit at this point?
There is no absolute aggressive fundraise programme. As of now, we are not doing anything. Like I said, there is enough runway available. Funds are available for more than two years. That is one aspect. But yes, one or two transactions will continue to happen. If there are investors who want to talk to us, whether strategic or financial, we will continue those (talks). But are we aggressively pursuing or running a process? That is not true.
Doesn't your exit during the festive season affect Flipkart's focus?
Some activity will be happening always. In that sense, there will be no right time. One has to make a view and move on.
What was the reason behind your decision to move on?
I have built a team and made a lot of changes. Something else came up and I thought let me try that.
You had come from a conglomerate to a startup. Do you think it was a mistake?
Not at all. I enjoyed the journey. There was a lot of learning and I personally believe that I have added a lot of value to Flipkart. A startup needs a lot of processes; we were able to do a lot of that. I don't think I regret it.
How do you see Sachin and Binny Bansal's leadership?
They are great entrepreneurs. They are the ones who initiated the whole thing. They will take the firm to much greater heights. One can move forward only if the leadership is great. Both have distinct styles. They will move forward in a big way.
How has been the competition with Amazon over the past two years?
For them, India is one of the biggest markets left, as they could not do much in China. They are very aggressive. But we have been maintaining our lead. We have done really well. October was a substantial month for us. We are an Indian (company); there is an Indian-ness about us and we will continue to lead the way. Yes, they have global processes, but we understand the Indian psyche better.
There have been a couple of investor markdowns in the past. How have the markdowns affected Flipkart?
Valuation markdowns were done by some investors due to other compulsions in terms of market realities. I don't think it has impacted us. Someone is coming up with a mathematical exercise for internal calculation without even elaborating—a number doesn't matter.
There was also a media report which said Flipkart was in talks with Amazon for a sell-out. Is that true?
No. This is a figment of imagination from your fraternity. There has never been such a thing.
There were layoffs at Flipkart in the past. Were those measures driven by concerns with regards to profitability?
I don't think there were any layoffs like that. Those were normal attrition and (related to) performance issues.
Do you think Flipkart has made any mistakes in terms of decision-making or organisational restructuring?
Every startup continues to learn and define the way it operates. It is a continuous process.
An allegation of fraud against you has been making the rounds in social media. Have you seen it?
I have seen it. It came out of nowhere. We have always followed a well-regulated process.
Where are you moving to? Are you starting up or moving to another company?
I have not really thought about it. I am unlikely to be in the startup world.
Will you be taking a break before joining the new place?
I have never taken a break. There is also an offer in air.
These are exciting times. But there are other things to be done also. For instance, I have been away from my family. There are no real regrets. There are other opportunities that I am wanting to pursue.