Until recently, Sachin hadn’t paid much attention to the fledgling ads business. But after the first Big Billion Day sale, he latched on to it. He recalled how during Flipkart’s early days, the ads revenue he had earned from Google and Amazon had been critical in propping up the company. Now he believed that it could be the transformational money-making scheme for Flipkart. Even Alibaba earned a majority of its profits through ads. Sachin had also been inspired by Facebook’s success in the US. When the social networking platform had started out in the mid-noughties, the desktop was the primary medium of most internet users. But over the past few years, people had increasingly switched to smartphones, a change that had upended many internet platforms. Not Facebook – it thrived more than ever in the smartphone era.4 It bought startups, introduced exciting new features on its app, copied rivals when it couldn’t buy or better them. Facebook now generated a majority of its revenues from ads served up on its mobile app.5 Sachin believed Flipkart could – had to – do the same here in India where most internet users would soon surf the net primarily on their phones.
In late 2014, Sachin was ready with the outline for the new Flipkart. A vision document was prepared. It was decided that Flipkart would be broken up into three parts. At the centre of the company would be the marketplace business that would be run by Mukesh Bansal. It would mark a stunning rise for Mukesh, who had joined Flipkart only a few months ago. In essence, Mukesh was replacing Kalyan Krishnamurthy.
Sachin and Binny, who had admired Mukesh for years, were even more impressed by him as they began to work closely after the Myntra deal. They appreciated not only his entrepreneurial abilities but his overall personality as well. Mukesh had cultivated a taste for couture after Myntra turned into a fashion-selling site a few years ago. He dressed down consciously. His taste was varied – he admired the fashion sense of Hrithik Roshan, George Clooney and Lisa Haydon.6 Mukesh was serious about health and fitness – he worked out nearly every day, and had a physique to show for it. He played golf, had friends in Bollywood, and at the same time, was well liked by many of his colleagues at Myntra as well as the company’s investors. He was well-read, soft-spoken, articulate. He was all this, a father to two kids, and also a hugely successful internet entrepreneur. For Sachin and Binny, Mukesh was the personification of ‘cool’. His life hadn’t been dissimilar to theirs. He had grown up in Haridwar, studied computer engineering at IIT Kanpur and written code before becoming an entrepreneur. Like the Bansals, Mukesh, too, was an advocate of using technology in retail. He was as introverted as they were, and yet he had evolved into a rounded, mature person, a man of the world, something the Bansals had always wanted for themselves. Mukesh, in turn, was highly ambitious. He harboured a desire to become CEO of Flipkart in the near future. He charmed the Flipkart co-founders with purpose and, unlike Kalyan, got along well with Sachin, who even encouraged Mukesh’s ambitions initially. Convinced that they had found their ideal partner, Sachin and Binny charged Mukesh with the daily running of Flipkart.
The logistics service would be headed by Binny. Not only would it deliver orders for Flipkart, it would also be expanded to become a large logistics firm on the lines of Blue Dart and DHL. Sachin would develop the advertising platform that would, over time, become Flipkart’s most important lever in moving towards profitability.
On the whole, the vision document of Flipkart 3.0 was a work of impressive conceptual ingenuity, the corporate equivalent of high-level graphic design or architectural planning.
In November 2014, at a meeting in Singapore, Sachin and Mukesh presented the vision document to Lee Fixel and Flipkart’s other board members. More than a dozen Flipkart executives had come to the meeting to make presentations. With Sachin’s aid, Mukesh articulated Flipkart’s new strategy. Although the plan was radical, there were few probing questions from the board members. And even fewer criticisms. The lone dissenting voice was that of Kalyan Krishnamurthy. Looking at Sachin, Kalyan said that there was one major problem with the strategy: Sachin wanted to turn Flipkart into Snapdeal, which had always been a far inferior company.
Sachin’s reply was terse. ‘Yes.’ Without offering an explanation, he moved on to other matters.
The other board members watched the exchange in silence. In more informal forums, Lee, along with other board members, had expressed some of their doubts to Sachin. Lee had pointed out that if Flipkart tried to become a marketplace overnight, its service might suffer and its carefully cultivated brand could get damaged. He was also a bit alarmed by the app-only plan. Many products were still being bought on the desktop website and millions of customers used both the desktop site and the app to shop on Flipkart. Why would the company want to lose all this business and hand it to Amazon? Lee had asked Sachin.
But Sachin, who had anticipated these questions, was prepared. He predicted that people were moving to the mobile in such large numbers that within a few years, all online shopping would take place exclusively through that medium. ‘If we have a world-class app, we can create a huge advantage. This is not what Amazon is good at. They’re not built for the
