Flipkart is on a high, having raised $1 billion from a group of investors, led by Tiger Global and Naspers, a deal that is likely to take the online marketplaceís valuation to around $5 billion. In an interaction with mediapersons, Flipkart co-founders Sachin Bansal and Binny Bansal talk about why profitability is not yet on the agenda for the seven-year-old firm and that empowering sellers and enhancing customer experience is a bigger priority over worrying about competition.
Is profitability still not an agenda?
Sachin Bansal: We have 22 million registered users today. The way we look at it, once we have 100 million customers, that day we will get profitable. Once we have delivered a product in one in three Indian homes, that day we will think of profitability.
Itís a long-term thing. I donít know whether it will take three years or eight. Profitability is not among the top-three metrics we are tracking at a founder level.
They are number of customers, number of sellers and customer experience. Itís only about what is the right time. It is very important to time your revenue engine because, otherwise, it will be a short-term view. Right now, we have limited bandwidth and time and we want to use that to grow as much as possible.
Binny Bansal: The ecosystem is also evolving at a very fast pace. So, you have to keep evolving every 12-18 months. With things changing at this pace, itís very important for us to keep growing our customer base, keeping them happy. We and our investors are confident that we will be a hugely profitable company.
What is the roadmap to spend the $1 billion?
Sachin: We are not looking at any specifics right now. From a vision point of view, we are looking at how commerce happens in India, how they transact, what they want to buy or sell. And what does it mean when it comes online and what are the problems and how they can be solved. We are looking into the seller side of things. Thatís much more scalable. There are a large variety of services like quality, which we can be solved using technology. That is somewhere we will definitely invest. Our agenda is to facilitate commerce for 500 million customers on the internet.
Flipkart is known for their reliability and services and we want to preserve that. We have over 3,000 sellers