Flipkart sets sights on fintech, plans to ramp up technology team
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Bengaluru: Flipkart, India’s largest online marketplace, which is set to enter new categories such as furniture and groceries, plans to launch and build a new business to tap the fintech sector and hire executives from Silicon Valley as part of its push into areas such as artificial intelligence and machine learning, even as it scales back focus from some initiatives such as assisted commerce.
In an interview, Flipkart’s chief technology officer (CTO) Ravi Garikipati said that planning around the fintech business is at an early stage and the company wants to bet on this sector to cater to customers in smaller cities and towns, adding that Flipkart will hire a senior executive to build out this business.
“The idea is that as we take on Middle India and expand our reach, we want to focus on affordability. Today, there’s a reason why offline (retail) is really thriving in certain categories, especially the big-ticket items. Fundamentally, offline entities are getting a better handle on consumers in terms of their risk profile and being able to opt for low-cost EMIs (equated monthly instalments) and things of that nature. The idea here is to mimic that pattern online in high-ticket categories, but do it a whole lot better,” said Garikipati.
“We think we can do it better because of our access to rich, commerce data, in conjunction with some third-party financial data. We can build some very proprietary credit scoring models and thereby expand our reach of the consumer base and offer commerce to those guys,” he added.
Flipkart also plans to hire aggressively for its technology team, with overall headcount increasing by at least 10% this year, said Garikipati. Flipkart’s tech team currently comprises about 1,200 engineers. “We’ll hire talent in areas such as computer vision, image sciences, folks with deep experience in natural language processing (NLP)... and also speech technology. We believe that the next wave of discovery is multi-modal in nature, so it could be a speech. So, we’re investing into that—so, speech is a big piece of our future innovation,” said Garikipati.
Even as Flipkart enters newer businesses and ramps up hiring amid a bruising market share battle against arch-rival Amazon India, the company is scaling back efforts in some futuristic bets where it does not see a huge business opportunity.
One of those bets is assisted commerce and its so-called online-to-offline (o2o) strategy, which targets remote parts of the country where awareness about e-commerce is low and users have inconsistent and limited access to the internet.
“I don’t think that (o2o) is a focus area right now. My mantra to my team and my leadership team is to pick top-end priorities that have massive scale,” said Garikipati.
This move feeds into chief executive Kalyan Krishnamurthy’s broader strategy of focusing on the basics and not repeating the same mistakes that the e-commerce firm made in 2015. Inside Flipkart, Krishnamurthy is said to favour quick fixes over long-term bets that entrepreneurs pride themselves on, according to at least three executives who work closely with him. All of them requested anonymity.
Flipkart, which has a technology centre in Silicon Valley called the F7 Labs, is also looking to bring some of those technology roles to its Bengaluru headquarters, as the company looks to keep a lid on hiring costs.
“The F7 Labs has been a centre of excellence for core competencies around AI (artificial intelligence) and ML (machine learning), but over time, we’re making it mainstream and folks in the Bangalore team are already taking on some of those challenges and problems,” said Garikipati.
“We seeded F7 in (the US), but it’s not like there will be a handful who will take on these problems and make a serious impact. We’re building the same competencies over here as well. The breadth and depth of the challenges are such that we need to have those competencies here as well. We will continue to grow to a decent enough critical mass in Palo Alto, but we’re investing here as well,” he added.