I joined Yahoo as a fresher in 2008. It was a company on the decline even then. Interestingly, now that Yahoo has changed its name, it has answered an interesting question in two different ways.
What is a company?
For the public, a company comprises of the products it builds, the services it provides and the people it employs. However, for all the practical purposes, a company is the investment made by people. As in the case of Yahoo, the parent stripped itself of the name Yahoo to get the return on the investment made by the founders and shareholders.
This brings us to another important question: when shall a company bring non-founder CEOs, how should they be selected, what values should they possess, what should they be accountable for?
While looking at the successful companies who have developed successful long-term strategies, it is evident that they had the Founder-CEOs at the helm. A founder is secure about his position which gives him enough leeway to invest in long-term strategies. Imagine Tesla and Amazon without their founders. Their CEOs have bucked the market pressure to show short-term results in favor of their long-term visions.
Steve Jobs made many bets on technologies which paved the way for smartphones.
Contrast it to the work of Yahoo CEOs. Not a single long-term bet has been made by any of the CEOs in last 8 years to turn the tide. In fact, the value of single bet made by Jerry Yang is 10 times of the Yahoo sold to Verizon.
The reason to discuss this today is that one of a favorite company has now got a professional CEO. My perception bias doesn't inspire me any confidence in Kalyan Krishnamurthy. I am sure that he will definitely meet the financial objectives of the investors. Unfortunately, it will mean that sooner or later he will find a suitor for Flipkart rather than fighting with Amazon. My guess for best suitor would be Walmart considering the recent lackluster results in all the brick and mortar stores of US and their appetite for big acquisitions.
A good choice would have been to bring an executive from Amazon who would be able to beat the Amazon at the same game, or a person who has been a successful founder.
In any case, I would be glad to be wrong and love to see a positive outcome with the new management change. Flipkart story has been a great inspiration for the new wave of entrepreneurs and it would be great if it remains the shining star of Indian startup story.