Mukesh Bansal Curated
Entrepreneur; Founder of Myntra
CURATED BY :
How can a fashion and lifestyle brand or retailer use technology to amplify the digital dividend?
What are term in the term sheet of which we should be extra careful from a founder's perspective?
How does one go about spending on building a brand without risking the business model, especially as a start up?
After lock down is over, everyone will try to keep expenses low and try to save money, service bases business will have gard time getting new work and product based business wont get much sales, how to tackle it?
How long and how much can we still sustain scalability at the cost of profitability and when is this going to end?
Tell us about your early experience of working in silicon valley and what propelled you to become an entrepreneur?
Where you clear about your future goals from the beginning or it kept coming to you with time?
Where you clear about your future goals from the beginning or it kept coming to you with time?
Besides being authentic What would an entrepreneur do who don't have much capital to create brands?
What & how do you go about the creating brand? Does it require lot of capital to build a brand or capitals comes in?
Is there any target figure you have put to yourself to reach people or any other goal vision with cure fit?
Why do you believe in there is no difference between ordinary & extraordinary people except there Willpower?
Which was the lowest point in your entrepreneurial journey and what made you not give up then?
How do you feel the difference between selling a service rather than a product in India?
Do you think there's still a long way to go for technology to bridge gaps in Fashion E-Commerce?
What changes you came across while changing your work in different areas like first in fashion market and then in fitness?
How was your experience working at silicon valley and how did you decided to be an entrepreneur?
If not Bengaluru, which city would you like to live in?
Very difficult to say as I don't think one can get everything that Bengaluru has to offer. For the tech capabilities, one can consider Gurgaon. Mumbai is a lot more happening on the culture and creative front. Being a small-town boy from Haridwar, I also dream of moving to a small place like Rishikesh and working from there someday! On a serious note, I would like to stay in either Bengaluru or Silicon Valley. These are the two places that where I get everything needed to pursue my dreams.
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What is your favourite Bengaluru moment?
I regularly go for a walk or a run at Kasavanahalli Lake near my house. Like most Bengaluru lakes, I would note the water level reducing each year and it was not cared for at all. A couple of years ago, I noticed that a small part of it was cleaned and a few saplings planted. As I kept going back, I noticed small improvements -more trees, paved running track and freshly painted benches. Today, it is one of the most beautiful lake trails in the city for a run. Then, I realized that it was the effort of a man! This gentlemen dedicate 3-4 hours every day, generates funds for the lake's upkeep, has planted trees and nurtures them. This is one of the most impressive citizen initiatives that I have seen in Bengaluru.
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What makes Bengaluru tick as an e-commerce hub?
After having spent 10 years in Silicon Valley, I was completely taken in by the valley-like culture of Bengaluru. I was convinced way back in 2007 that Bengaluru will become the silicon valley of India. It is the thriving innovation hub of the country with almost all major tech disruptors based out of here. From the strong tech culture, cosmopolitan nature to great weather all year around, it's a privilege to work here. Bengaluru has become the quintessential melting pot of India where top talent pours in. It is also the first port of call for all the techies returning from the US.
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You have been elevated on the board of Flipkart. We hear that there is another complete restructuring that is happening currently, first time in seven and a half years. What is your new role and what are the challenges ahead?
Restructuring is an ongoing process. We will continue to restructure. We are focusing on bringing new leaders into the organization. As the size of the business increases, we are identifying into new areas. We have done some reorganization recently for this process.
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How are you ramping up your hiring? By what percent do you expect to increase your employee numbers this year?
Focus is a lot more on quality than numbers. We are already a pretty large organisation. There is a huge amount of interest in people wanting to work at Flipkart. Our focus would be to get really top technology people and create an environment for us to do good work. There will be sizeable growth probably propionate to the business growth we are expecting this year.
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What is the investment for the mobile app?
Most of our investment on the technology side is building differentiated experience for consumers, building all the back-end system for supply chain and infrastructure for data centers.
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You are now shifting focus to mobile shopping. There is a special mobile app through which consumers can actually buy online. How do you see this trend picking up?
The mobile platform is a massive trend. In India, most of the internet traffic is through mobile. Over 80 percent of internet traffic is through mobile. This year, we will continue to focus on improving our experience through mobile. We see huge traction of Flipkart mobile app.
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Does it mean to say that you will be shutting the websites and focus more on the mobile app considering that is the future trend?
There are different needs of a different platform. There are people who use the computer in some cases. We will focus on all platforms, and we are not looking to close our website.
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You have recently shuffled your top management. Tell us about it.
We continue to tinker with our structure to optimize what our current priorities are. So, it is an ongoing process. This is an ongoing adjustment to make sure our leadership bandwidth is distributed on the big priorities for the organization. We are also focusing on bringing in new leaders in the organization. So, as the size of the business is increasing we have identified new areas that we need to add more leaders into. We have done some reorganization recently and as I said we will continue to work on improving that throughout this year.
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Can you tell us how you are working with the government to train and hire employees?
With Flipkart footprint expanding, we believe there is a huge requirement for training. We are collaborating with the government, giving inputs on what kind of skills are required and generate hundreds of thousands of jobs in the next few years.
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What made you decide to invest heavily in technology automation and data analytics?
We are focusing on technology. We need to have world-class technology infrastructure. We work with various providers. We will start to have some of the largest data centers and exploring multiple options to build that.
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You have very few e-commerce rivals in the furniture segment, which you are interested in. By when can we expect the furniture segment online?
This year we are actually focusing on almost all the consumer categories. We are expanding our selection including home and furniture as well. We will get a lot more third-party retailers on board. We focus this year to establish Flipkart as a destination for home and furniture as well.
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Is there a middle ground to the net neutrality issue?
Not sure. I think net neutrality principles are very clear. There are a number of ways — whether it is telecos or other participants of the ecosystem — to continue to help drive the growth of internet including e-commerce players without violating the spirit of net neutrality which requires that the data not be discriminated, big or smaller players are not discriminated and consumers are not discriminated.
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How will net neutrality have an impact on your net based businesses?
Internet proliferation and easy, cheap access to all of India is overall a good thing. That is what has benefitted e-commerce in last few years and that will continue to do so. So, we are very optimistic about the growth of the internet especially through mobile phones and being able to keep internet access neutral is a good thing which will help accelerate the growth of the internet.
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Tell us about your pullout from the Airtel Zero negotiations.
We evaluated over the last few days and we realized that the way it is designed today, in future it can potentially lead to some violation of net neutrality. As a company, we are very deeply committed to ensuring that the internet in India continues to be very democratic, equally accessible and that is the reason why we decided not to go ahead with this.
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Would you choose to enter a niche segment like healthcare in the future?
Having been part of Flipkart for a while, I will go for anything which has a scale.
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Are you done with e-commerce and fashion or is that likely to be something that you would want to go back to?
Absolutely done from the active operating role. So, I continue to be involved in Myntra and Flipkart as both shareholder and advisor. But I have done my bit in terms of operating in the e-commerce business.
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So, not fashion, not e-commerce. What else would you be looking at?
I am looking at a number of different industries. I have spent some time looking to healthcare, looked at education, financial services and I am just actually quite pleasantly surprised both with the size of this industry, how fast this is growing, how many problems are unsolved and how big a role technology can play. Exactly which problem to work on I will take the next few months to figure that out. In fact healthcare along with fitness and sports, these are a little bit not quite same but related.
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So you are saying the strategic choice will continue to drive growth even at the cost of profitability at least for now?
Maybe let us say two years ago 100 percent focus was on growth and on profitability. I would say last 12-18 months it has become at least half-half. So, we are going forward here and going forward probably this probably will be more on profitability and little less on growth.
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Even if I were to look at the Flipkart story, the losses continue to mount even as far as Flipkart is concerned. Which is why people then don’t believe this credible road to profitability theory.
Almost all the metrics I look at especially compare year over year, they are all improving steadily. Our burn as a percentage of revenue is steadily going down. So, that is a good sign of progress. Our gross profit percentage per order is improving. I feel very confident that for Flipkart also the profitability is not that far out. It may still take a few years.
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How much of your total revenue do the private brands make up?
Myntra will be the first profitable company in all of the E-Commerce in India. It may still take another 12-18 months but not that far off. Most of our ratios are steadily improving.
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In this large market what kind of new things do you think will happen in the internet space? What kind of new opportunity exists for the entrepreneur?
What do you think made your competitors not progress further? What mistakes do you think have they made?
How did you face the challenges when your in-fashion business was growing 10 times more since the time you started?
Having made Myntra reach the number 1 spot for fashion, did you think of remaining independent or merge it with another company?
How was your experience raising capital? What advice would you give entrepreneurs who are raising capital?
Any advice would you like to give to the potential entrepreneurs who are looking for a pivot in what they have built and what they are going to do now?
Were you surprised with the pivot that happened in your business and how did you manage the pivot?
Would you advise people who want to come back from the United States to start their own businesses here?
In your conversations with investors, how important is the topic of profitability?
We do have a path to profitability agenda. But that is not the only agenda. We want to grow our market share, we want to deliver meaningful differentiation for our consumers. So profitability is among the top five priorities for us, and it does get discussed with investors.
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Considering how fast valuations have risen over the past year, do you regret selling Myntra at the price you did?
Myntra has also benefited from valuation appreciation. It’s not like that growth is not happening. It’s a big reason Myntra-Flipkart together are able to see the increase in valuation we’ve seen over the last one year. Investors have the realized the combination of the two is much more powerful. So, absolutely no regrets.
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What do your recent investors such as DST Global, Qatar Investment Authority and GIC bring to the table?
One is the ability to stick with the company for a long period of time. When the company goes public, they have the ability to buy a significant chunk. Most of our new investors have a pretty broad Internet portfolio around the globe, so there’s the network that comes with them. We know we’re doing very well, but things don’t always progress in a straight line. There are good times and not-so-good times. Investors’ ability to support the organization is a huge advantage. These are people who won’t be fickle minded. This means we won’t have to deviate from our advantage regardless of what’s happening outside.
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Why are you raising so much money in a short span of time?
We would like to be in a position where we are not driven by short-term changes in the macroeconomic environment and focus on our long-term projects. For instance, we are looking at building a massive supply chain network. That is a long lead time project and we want to be able to do it independent of the business cycles. That’s part of the motivation (for raising so much money). We want to make sure we’re reasonably capitalized and we’re not making short-term changes to optimize the cash-burn situation. Also, most of the high-quality investors want to be part of the India growth story. So we also look at what investors are bringing to the table. It’s not only money, their network, their understanding—we want to have a strong team inside the company and investors are a part of this. So even if there’s no need to raise money, if we get a really strong investor on board at the right valuation, we’ll do it.
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What are the other factors driving valuations?
Valuation is also driven by sentiment. The macroeconomic sentiment is pretty good. India’s GDP (gross domestic product) is picking up. The falling oil prices is a huge boon for the economy, and consumer confidence is high. Some of this is playing into foreign investors’ interest in wanting to participate in India’s growth story. All of these things contribute and, yes, valuations are driven by business cycles and they do change. It’s very difficult to say whether the valuations are inflated or not. Even VCs (venture capitalists) who say valuations are too high, they are also the ones who out-compete each other for investments.
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