Big Billion Startup: The Untold Flipkart Story

improved for many; the improvement had just been incremental rather than the miracle claimed by the party. Politicians, like astrologers, are usually better off promising a happier tomorrow rather than glorifying a barely tolerable present.
But in fact, just as Amazon opened its office in the IT city of Bangalore in July 2004, India entered a period of unprecedented economic expansion, building on the foundation laid by the reforms of 1991 and then further solidified by the BJP. Thirteen years after he had helped implement the liberalization policies as Finance Minister, Manmohan Singh, now Prime Minister of the Congress-led coalition government, began a five-year term during which India came as close to ‘shining’ as it ever has.
In this period, from 2004 to 2009, many Indians bought basic commodities like soaps and biscuits for the first time. They bought mobile phones and television sets, installed telecom connections. From country liquor, they switched to whisky, even if it was a local variety. In fewer numbers, Indians acquired scooters and cars. A few million lavished cash on computers and internet connections. For a time, it seemed not impossible that Kishore-ji could actually become a ‘poor man’s’ Sam Walton, as not only consumer goods makers, but many kinds of businesses blossomed in this period. IT services lost their glamour – the call centre myth, like the actual experience of working at one, was unsuited for longevity – but sales and profits at IT companies soared to record levels. From just two billionaires in the mid-nineties, India boasted as many as forty-nine billionaires by 2010, as was pointed out in Forbes magazine.5 Capitalism replaced socialism as India’s guiding economic philosophy, as consumerism went mainstream, enthusiastically taken up as a way of life by a growing middle class.
They weren’t aware at the time, but this was the new India that Ajay and his IIT-mates – among whom were Sachin Bansal and Binny Bansal – would witness in the first phase of their careers. And in their impressionable years, Ajay, Sachin and Binny, along with a hundred other unformed engineers, were indoctrinated in the practice of perpetuating consumerism by Amazon, a company that existed solely to convert every living person to this faith and keep them entranced through its unending cycle of product accumulation and delivery.
TECHNOLOGY ENTREPRENEURSHIP HAD taken off accidentally in the US and China. In the 1950s, the US government funded research in California aimed at improving America’s defence and aviation technology. These research projects, and the lure of prestigious institutes such as Stanford University, drew some of the smartest minds in science and technology to California. As these innovators – the most prominent of whom was William Shockley, winner of the Nobel Prize in 1956 for his role as one of the inventors of the transistor – collaborated, they birthed inventions that would eventually lead to the introduction of personal computers and pave the way for mass adoption of the internet. In the 1960s, the counterculture movement supplied the ethos that induced people to believe that personal computing would transform the world for the better even as they enriched themselves beyond belief. In a nutshell, an unlikely combination of government-funded research, the madness of flawed geniuses like Shockley,6 a small number of adventurous financiers, along with the hippie movement, created and nurtured entrepreneurship in Silicon Valley. Companies like Fairchild Semiconductor, Intel, Apple, Netscape and Paypal were born, which in turn spawned hundreds of entrepreneurs.
The evolution of India’s internet ecosystem was slightly more straightforward. Its epicentre was Bangalore, which was once described by Nehru as ‘the city of the future’.7 Modern Bangalore traces its origin to 1537 when Kempe Gowda, a ruler of the Vijayanagara Empire, built a fort and established a settlement in the region. In 1799, the British won the state of Mysore. A decade later, a cantonment area was established for British officers in Bangalore, in close proximity to Kempe Gowda’s old town.
After India’s independence in 1947, Bangalore became the country’s tech centre. The city was home to the Indian Institute of Science, many engineering colleges and government-owned companies such as Hindustan Aeronautics which were engaged in technology work. Many of these institutions had been established before independence through the efforts of the great technocrat M. Visvesvaraya with help from industrialists such as Walchand Hirachand and Jamsetji Tata and the progressive ruler of Mysore state, Krishna Raja Wadiyar IV.8
In 1985, Texas Instruments, an American hardware firm, opened an office in Bangalore and rapidly attracted some of the country’s best engineers. Around the same time, Infosys, an unknown startup in those days, moved offices to Bangalore from Pune. The success Infosys achieved soon after proved something important: it was possible for entrepreneurs from India’s middle class to establish hugely successful businesses by dint of sheer innovation and hard work, without having to curry favour with bureaucrats and ministers to get ahead. Infosys’ success also firmly anchored Bangalore as the tech hub of India for the private sector. The city’s pleasant weather, cheap rents and cosmopolitan ethos made it all the more attractive to prospective migrants. In the mid-2000s, the term ‘Bangalored’ entered the political and economic lexicon.9
Soon, India’s booming economy caught the attention of American venture capitalists hunting for promising new markets in software, internet and consumer businesses. The venture capital scene that had lapsed into a moribund state after the American tech bust was quickly rebuilt around 2006. Indian-American tech executives, such as Ashish Gupta (one of Junglee’s founders), Vani Kola and Vinod Dham, moved to India to set up venture funds. Entrepreneurs like Avnish Bajaj, Suvir Sujan and Alok Mittal entered the venture capital arena after making a few millions selling off their internet businesses in India. Other early venture capitalists like Sudhir Sethi, and the Subrata Mitra–Prashanth Prakash duo – whose fund Accel Partners would become the first institutional investor in Flipkart – had spent their careers in India’s IT sector but now wanted to be at the frontier of the country’s next technology boom.
While all these factors created a hospitable