Annelütfen

What did it do?

Annelütfen was an e-commerce site focused on products for mothers, babies and children, founded in Istanbul in October 2011 by Roys Güreli. In 2012 it was selling more than 10,000 products from over 300 brands. From late 2013 it also sold on a subscription model, organised events for mothers and published video content on its blog.

Why did it shut down?

In June 2016 Annelütfen announced on its official blog that it was temporarily suspending orders, giving as its reason a wish to serve customers better; Webrazzi, the Turkish tech news site, wrote that it might become a content site from then on. No detailed financial statement was made. According to Internet Archive records, the domain redirected in the following months to a blog holding only old posts; there is no record of sales ever resuming. The decision to stop came only a year and a half after a $4 million investment in January 2015. Because no reason was shared, the idea that financing growth had become difficult in the highly competitive mother-and-baby vertical can only be offered as an interpretation.

The story

Roys Güreli was one of the entrepreneurs who returned to Turkey after an MBA at Stanford. In October 2011 he founded Annelütfen in Istanbul. As the name, which means roughly 'Mum, please' in Turkish, suggests, the site was aimed at mothers: it offered a broad catalogue running from baby and children's products to products for mothers themselves.

According to a July 2012 report in Webrazzi, the site carried more than 10,000 products from over 300 brands, and a team of six had shipped 10,000 orders to date. Investors and advisers in the second round, closed in June 2012, included Ventech, Richmond Park Capital, Fabrice Grinda and Agah Uğur, CEO of Borusan Holding; the amount was not disclosed. From late 2013 the company began selling on a subscription model and organised events with mothers.

In January 2015 Annelütfen closed a round that Webrazzi described as one of the most significant e-commerce investments it had seen in recent times. According to Webrazzi, Elixir Capital invested $4 million after the company's turnover grew by 315 per cent in 2014 compared with the previous year. In 2015 Güreli explained that 7 million babies were born every year in Turkey and the Middle East, and that the market was expanding as parents' internet use grew. The fund saw Annelütfen as one of the cornerstones of a multi-market e-commerce platform that would extend to Asia.

About a year and a half later, on 30 June 2016, Annelütfen announced on its official blog that it was temporarily suspending orders. The reason given was a wish to serve customers better. Webrazzi, noting that the start-up had for some time been reaching its followers with written and video content, wrote that the site might become a content site from then on. According to Internet Archive records, in the following months the domain redirected to a blog whose latest posts dated from 2015. No news or record of sales resuming has been found.

The Annelütfen story shows that even after strong growth figures and a large funding round, a vertical e-commerce site can stop in short order. That the announcement was framed as temporary is a reminder that closures do not always arrive with a clear farewell message.

Lessons for founders

• If a large funding round will not cover your cash needs for the next 18 months, plan the next round or a path to profitability straight away.
• If you are temporarily halting sales, give customers and suppliers a clear timetable; uncertainty erodes whatever value the brand still has.
• In a crowded vertical, differentiators such as subscriptions or community only work if they measurably increase repeat purchases.

Sources

1. Annelutfen.com decides to stop sales (in Turkish) (Webrazzi, 2016-06-30)
2. Annelutfen.com raises $4 million in a round led by Elixir Capital (in Turkish) (Webrazzi, 2015-01-05)
3. Anne Lütfen: mother-and-baby e-commerce start-up completes its second investment (in Turkish) (Webrazzi, 2012-07-26)
4. Annelütfen blog home page, Internet Archive snapshot (Internet Archive, 2016-10-01)

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