Walmart buys stake in Flipkart, End of Flipkart independent run: Know the journey of India’s first online retail market
In the business industry, the deal of Walmart and Flipkart has turned out to be the largest e-commerce deal anywhere in the world. American retail giant Walmart Inc US retail giant Walmart is finally buying 77 percent stake for USD 16 billion. With this deal, the independent run of Flipkart ends. Flipkart is 11 years old company started by two IIT Delhi engineers Sachin Bansal and Binny Bansal with ₹ 4lacs only. As per the deal, the valuation of Flipkart is made approximately $21 billion (Rs 1.47 lakh crore). Let’s have a look on the journey of Flipkart.
Flipkart, the e-commerce retail store was the first of its kind in India. Started in October 2007, the owners of Flipkart were the former employees of US e-commerce giant Amazon. It was started with the book selling online and get them delivered to their doorstep. In the first year itself, it registered 20 shipments. In fact, there were predictions that online trading is a foreign concept that won’t work in India. But, it really worked well. The tremendous success of Flipkart created a new online industry altogether in India.
Growth of Flipkart
The company’s growth can be gauged by multiple ways. The company which was started in a two-bedroom apartment in Bengaluru now has multiple offices across the country. It has a plush campus in Bengaluru which is spread over 1 lakh sq ft and houses 6,800 employees.
Talking about the growth of this online retail store, it got its first full-time employee after two years of starting. The no. increased rapidly to 150 that year. Gradually, the company began to get investors like Accel Partners and US hedge fund Tiger Global and received good funding. Later, Flipkart raised $1.4 billion from Tencent, eBay and Microsoft, followed by $2.5 billion investment by SoftBank Vision Fund last year.
In 2010, the company introduced new product categories and also pioneered ‘Cash on Delivery’ in India. Later on, Flipkart acquired many companies like Letsbuy, FX Mart, fashion e-tail player Myntra and UPI-based payments startup PhonePe.
New management structure
The deal which has been finalized on May 2018 but it has been in the works since 2016. The present management of company will see some changes. Sachin has sold his entire stake of 5.5 percent for around Rs 7,000 crore while Binny will retain his 5.5 percent stake and will be Chairman of the company’s Board. Kalyan Krishnamurthy, the present CEO of Flipkart, also stays with the present role.
Walmart made a statement that it would keep Flipkart as a separate brand and have an independent operating structure. It is known that Walmart has a massive shareholding in company.
Present situation in Flipkart
In present, more than 17 Million products are shipped every month. It has 175 million registered users with 20 Million Visits per day on the website. It has more than 80 product categories.