Bengaluru: About a month ago, on the eve of Flipkart’s flagship Big Billion Days sale, Binny Bansal found himself answering an awkward question during a fireside conversation with a high-profile Indian venture capitalist (VC).

The occasion and mood was one of celebration at one of Bengaluru’s upscale hotels. The room was filled with several prominent entrepreneurs, VCs, bankers and tech journalists.

Most of the questions posed by Chiratae’s founding partner Sudhir Sethi to Bansal were harmless enough. One of them, however, caught Bansal off guard and drew a nervous laugh from him.

“A press report says that you’re leaving Flipkart...," Sethi trailed off, without needing to finish the question. The press report in question was Mint’s article on 24 September, which stated that Flipkart might appoint a new group chief executive officer (CEO) in place of Bansal.

Bansal, trying to deflect the question, laughed it off.

“I think that’s the thing about the media here. The media loves us, and we love the media. This kind of a report is there every other year about me or some other member of the (Flipkart) team. We just take it in our stride and focus on what is next for us," said Bansal, without actually clarifying whether the news was accurate or not.

There’s no doubt now.

Bansal on Tuesday abruptly resigned as Group CEO following an internal investigation into an allegation of “serious personal misconduct". The investigation did not find any evidence to support the allegation but it showed “lapses in judgement" on Binny Bansal’s part, said Flipkart owner Walmart Inc. Bansal will continue to serve on Flipkart’s board and retain his stake worth $700-800 million in the company.

Bansal’s resignation comes months after he wanted to originally leave Flipkart.

Earlier this year, just before Walmart bought a majority stake in Flipkart, Binny Bansal was actually on his way out of the company, wanting to part ways after the takeover, while Sachin Bansal wanted to stay on, having played a crucial role during the negotiations. However, in a stunning reversal of fortunes, Binny ended up becoming the face of Flipkart after the Walmart deal was signed, while Sachin was forced out.

More significantly, on 9 October, nobody in the room that evening had any inkling that Binny Bansal was already in the midst of an internal probe that would ultimately lead to an unceremonious ouster.

Binny Bansal’s departure marks the end of the journey of a man who was always referred to as “the other Bansal", the guy who focused on the nuts and bolts of the operations, playing a worthy foil to the big-picture vision of Sachin Bansal.

For two entrepreneurs who are widely regarded as the poster boys of India’s startup ecosystem, the manner of their exits could not have been more unceremonious.

“This is terrible for the startup ecosystem, a black mark so to speak. It casts a huge shadow across entrepreneurship in India, given the profile of someone like Binny," said the managing partner of a top VC firm, requesting anonymity.

“This is shocking. Binny is the guy who has the highest standards in ethics and integrity. It’s quite unfortunate that this became public because he wasn’t found to have committed harassment. But it was poor judgement on his part. Everyone at Flipkart is shocked," said a former Flipkart employee who worked closely with Binny.

Humble beginnings

Like Sachin, Binny also hails from Chandigarh and studied software programming at the Indian Institute of Technology, Delhi. He joined Amazon in 2007, but quit shortly to start Flipkart with Sachin.

While Sachin was seen as more volatile and intuitive, Binny was the exact opposite. According to at least three former executives who worked closely with the Bansals (not related), Binny was calm, tactful and “data-driven" as compared to Sachin.

However, for the first five years of Flipkart’s existence, Sachin largely ran the show, with Binny playing second fiddle. Binny’s big test came in 2012, when Flipkart was fast running out of cash and the two founders were struggling to convince investors to back them. During those two years, Binny took over the running of Flipkart, while Sachin pitched investors and handled Flipkart’s response to a probe by the enforcement directorate for allegedly violating foreign direct investment rules.

After the massive fundraise of 2014, the relationship between the Bansals started to change. In 2015, Sachin was convinced that Flipkart should become app-only, and to stay relevant, it should completely remake itself. While Binny did not oppose the strategy, he did not advocate strongly for it either. Through 2015, he increasingly started distancing himself from Sachin’s vision for Flipkart.

During those years, Binny also started working hard on his leadership qualities and signed up for personality training and leadership coaching in 2014. Those efforts would eventually pay off when Sachin was shunted from the role of CEO in January 2016 and Binny anointed the new leader.

However, Binny’s stint as CEO did not last long, when he failed to effect a turnaround in Flipkart’s fortunes against Amazon, which was rapidly snatching market share away from Flipkart.

The appointment of Kalyan Krishnamurthy as CEO in January 2017 somewhat marked the beginning of the end of Binny’s journey at Flipkart. The circumstances of his exit solidifies the impression that, much like Sachin, Binny leaves behind a mixed legacy.

Some investors and entrepreneurs who have worked closely with Binny, however, said he can continue to be a valuable role model in the Indian startup ecosystem.

Bansal is a prolific startup investor, both through direct investments in companies like SigTuple, Pandorum Technologies and Ather Energy, as well as through investments in funds like India Quotient and Stellaris Venture. He’s expected to make more much investments.

“The latest episode will not matter eventually. Binny still has his entire life ahead of him. His legacy will depend on what he goes on to do. Ultimately, he simply has to continue his good work to prove that he is a great individual and entrepreneur," said Anand Lunia, general partner of IndiaQuotient, which counts Binny as an investor.

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