After the exit of Sachin Bansal , soon after Walmart - Flipkart deal, his close friend, co-founder and the group CEO of Flipkart, Binny Bansal also resigned following an investigation by the company into alleged 'serious personal misconduct '. The company in a statement said "Earlier today, Binny Bansal announced his resignation as CEO of Flipkart Group, effective immediately. Binny has been an important part of Flipkart since co-founding the company, but recent events risked becoming a distraction and Binny has made a decision to step down". However, the company did not further disclose the nature of allegations that were leveled against him. Sources told Business today that the complaint was filed earlier this year in July by one of its ex-employees after which an enquiry was conducted by a law firm at the behest of the board of the company.
In an emotional email, Binny denied allegations levelled against him, and said although he was contemplating stepping away from his current role for a while, his decision was accelerated by certain personal events that have taken place in the recent past. "Events relate to a claim of serious personal misconduct made against me, which was uncorroborated after a thorough investigation completed by an independent law firm. The allegations left me stunned and I strongly deny them".
Binny further wrote "The investigation, however, did bring to light lapses in judgment, particularly a lack of transparency, related to how I responded to the situation. These have been challenging times for my family and me".
The news of his exit came as a surprise to everyone including the employees. One of the employees who did not wish to be named said "I can't believe that Binny can be involved in anything that could amount to personal misconduct".
Unlike his friend and the other co-founder Sachin Bansal who quit the company following acquisition by Walmart and also sold his 5.5 per cent stake, Binny will continue to be a large shareholder in the company and will continue to serve as a member of the Board of Directors.
Meanwhile, the board and Kalyan Krishnamurthy, CEO, Flipkart also reached out to employees through emails.
Terming the exit as 'unfortunate and challenging for Binny , his family and Flipkart' , the board in its email said that there will not be changes to the existing structure . Krishnamurthy will continue to be the CEO of Flipkart, which will now include Myntra and Jabong, continuing to operate as separate platforms. Ananth Narayanan will continue as the CEO of Myntra and Jabong, while Sameer Nigam will continue as PhonePe's CEO. He will now directly report to the board of the company.
Although Krishnamurthy didn't go into the details of the investigations, in his email, he assured employees that it will be business-as-usual, going forward. "Flipkart's leadership position today was possible due to years of hard work and collaboration between all stakeholders of the e-commerce ecosystem, particularly you, whose ingenuity and dedication have led us to become the market leader in India," he said.
"So, I wanted to personally let you know that there will be no changes in our operating processes or to the mission of the company as a result of this news," he added.
While the details of the nature of the allegations and investigation are likely to come out in the time to come , for a company that is now fighting its biggest battle in the e-commerce space, the unceremonious exit of its founders was perhaps the least expected .