incir.com
The platform that let anyone open a virtual shop in a few clicks and sell on commission without holding stock
- Founded
- 2012
- Closed
- 2016
- Lifespan
- 4 years
- Country
- Turkey
- Sector
- E-commerce
- Founders
- Yusuf Yıldırım
- Investors
- Hasan Aslanoba, Çağlar Erol, Emre Aydın, Cem Tüfekçi, Webdenal
- At its peak
- Shops opened by 35,000 people and TL 75 million in turnover in 2015 (Hürriyet, 2016)
- Cause of closure
- Ran out of cash
What did it do?
incir.com was a Turkish e-commerce platform founded in 2012 by Yusuf Yıldırım. Without dealing with stock or operations, users could open their own virtual shop in a few clicks, stocked with products chosen from the platform's catalogue, and earn commission on sales. The model relied on a network structure that also rewarded members for bringing new members onto the platform.
Why did it shut down?
According to Webrazzi, the company's growth slowed from the start of 2016 and it needed fresh funding. An investment agreement due to be signed on 18 July 2016 fell through when the investor pulled out after the coup attempt of 15 July. The closing off of the bankruptcy postponement route under the state of emergency narrowed the options further. When talks with other companies came to nothing, the company announced on 9 September 2016 that it could not continue because of its operating costs. A structure that had grown on a high valuation and constantly needed new funding could not survive a single investment round falling through.
The story
When Yusuf Yıldırım founded incir.com in July 2012, the idea was simple: anyone who wanted to open an online shop should be able to set one up in a few clicks, without holding stock or dealing with shipping. According to a Webrazzi report at the time, users chose from more than 70,000 products and earned commission on sales. The model relied on a network structure that also rewarded members for bringing new members onto the platform. Çağlar Erol, founder of Enuygun.com, and Emre Aydın, founder of Çiçeksepeti.com, were among the first angel investors.
Growth came fast. In May 2013 the angel investor Hasan Aslanoba invested USD 1 million; at the time the platform had more than 2,000 registered shops. In March 2015 the company raised USD 3 million in new investment at a USD 57 million valuation. According to the Turkish daily Hürriyet, 35,000 people had opened shops on incir.com and the company's 2015 turnover had reached TL 75 million. As Webrazzi reported, Yusuf Yıldırım said at Webrazzi Summit 2015 that the company had turned over more than TL 10 million in 2014 and that its target for 2015 was TL 100 million; headcount had reached 100 at the time.
At the start of 2016, however, growth slowed and the company went looking for new funding. As Webrazzi reported, after talks conducted at a much lower valuation, the deal was due to be signed on 18 July. The coup attempt of 15 July upended that timetable and the company that was to invest pulled out. The closing off of the bankruptcy postponement route from 1 August under the state of emergency narrowed the company's options further. Talks with other companies also came to nothing.
On 9 September 2016 incir.com announced that it could not continue operating because of its operating costs. According to Hürriyet, around 500 customers were still waiting for their orders at the time of the closure, and there were also problems with payments to suppliers.
The story of incir.com shows how exposed a model is to external shocks when its rapid growth depends on constant new investment. A single investment round falling through pushed a four-year-old start-up into closure within a few weeks.
Lessons for founders
- If your growth depends on constant new investment, a single round falling through can finish you; keep a cash buffer of at least 12 months.
- The higher your valuation climbs, the higher the bar for the next round; be prepared for a down round.
- Macro shocks are beyond your control, but how quickly your cost structure can shrink is your decision.
Sources
- incir.com has closed! [Breaking] (Webrazzi, 2016-09-09)
- incir.com has closed (final statement) (egirişim, 2016-09-09)
- It was going to be Turkey's biggest; it closed overnight (Hürriyet, 2016-09-23)
- İncir.com raises USD 3 million in new investment at a USD 57 million valuation (Webrazzi, 2015-03-30)
- incir.com receives investment from Hasan Aslanoba (Webrazzi, 2013-05-24)
- incir.com (Webrazzi, 2012-11-22)
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