Pabbuc.com

What did it do?

Pabbuc.com was a vertical e-commerce site selling shoes, bags and accessories, founded by Serdar Yaman in Izmir in 2005. It was remembered as Turkey's first online shoe retailer and sold products from more than 70 brands. In 2009 it received investment from the founders of GittiGidiyor, the Turkish online marketplace.

Why did it shut down?

Founder Serdar Yaman told Webrazzi that for a long time they had been talking to investors in Turkey to raise new funding for the company, without success. According to Yaman, a difference in vision emerged between him and his partners, particularly after the sale of GittiGidiyor, and they decided to part ways. No new stock had been bought in the six months before the closure; talks to sell the site as it stood also came to nothing. A 2017 round-up by Habertürk likewise attributed the closure to a disagreement between partners. The company stated that it had not gone bankrupt but had entered liquidation.

The story

When Serdar Yaman set out to sell shoes online in Izmir in 2005, it was an idea that had barely been tried in Turkey. As Webrazzi later reported, there was a time when he had to keep the stock in his own home. Pabbuc.com grew by adding bags and accessories to shoes and came to be remembered as Turkey's first online shoe retailer.

In September 2009 a partnership arrived that changed the site's fortunes. Burak Divanlıoğlu and Serkan Borançılı, the founders of GittiGidiyor, the Turkish online marketplace, each took a 20 per cent stake, and Burak Büyükdemir, founder of Goril Bilişim, took 4.2 per cent. The amount invested was not disclosed. According to figures shared in February 2012, Pabbuc.com had grown by 500 per cent two years running. Monthly visitors had passed 1 million, there were more than 80,000 products in the warehouse, and 99 per cent of more than 11,000 customer reviews were positive.

Behind that picture, however, another story was unfolding. As Yaman later explained, a difference in vision emerged between him and his partners, particularly after the sale of GittiGidiyor. He talked to investors in Turkey to find new funding for the company, without success. No new stock could be bought in the last six months, and attempts to sell the site also failed.

On 30 November 2012 Pabbuc.com announced that it was suspending sales indefinitely. The statement said orders placed up to that day would be delivered and thanked the suppliers of more than 70 brands and the staff. Yaman said the company had not gone bankrupt but had entered liquidation. According to a 2016 round-up by Turkishtime, Yaman had said at the time of the 2012 closure that sales were going well, that they were selling more than 10,000 pairs of shoes a month and that 2,500 pairs had been sold even in the last four days; the company had once employed 49 people, but by the closure the number had fallen to 19. The closure made such waves in the ecosystem that a few days later Webrazzi published an article drawing 13 lessons for founders from the Pabbuc case; the first was that looking for investment can take months even for a company that is doing well.

Pabbuc.com's story shows how a start-up that began with the right partners at the right time can be left on its own when those partners' priorities change.

Lessons for founders

• When your investors' own priorities change, so does the way they look at your company; set up your shareholder agreement with that in mind.
• Start looking for investment before you need it; the process takes months even for a company that is doing well.
• Stopping restocking is the first signal customers get before a closure; draw up your cash plan before it comes to that.

Sources

1. Pabbuc.com has closed [Updated] (Webrazzi, 2012-11-30)
2. Investment in Pabbuc.com from the founders of GittiGidiyor! (Webrazzi, 2009-09-14)
3. Pabbuc.com grows 500 per cent two years running [infographic] (Webrazzi, 2012-02-14)
4. 13 lessons to learn from e-commerce start-ups that have closed (Webrazzi, 2012-12-03)
5. The Turkish e-commerce sites that closed before Markafoni! Why did online shopping sites shut down? (Habertürk, 2017-06-02)
6. 50 failed start-ups and 50 lessons from their mistakes (1-15) (Turkishtime, 2016-04-29)

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