Flipkart has decided to shut down ANS Commerce, its full-stack e-commerce enabler, three years after acquiring it in 2022. The Gurugram-based startup, founded in 2017, provided various e-commerce solutions, including store technology, performance marketing, marketplace management, and warehousing. Despite an increase in operating revenue, rising losses forced Flipkart to discontinue its operations. Employees have been laid off, but Flipkart has assured transition support, including internal job placements and severance packages.
The move reflects Flipkart’s strategic shifts within its e-commerce ecosystem. ANS Commerce had collaborated with over 100 brands, such as Jack & Jones, HUL, Lakme, and Nivea, helping them with digital storefronts and logistics. However, the financial burden became unsustainable. The startup had secured $2.2 million in pre-Series A funding before being acquired by Flipkart in a deal valued between $35-40 million (INR 250-300 crore). Despite a revenue increase of 39.4% to INR 54 crore in FY24, the company’s losses widened by 27.1% to INR 73.8 crore.
Flipkart’s decision aligns with broader industry trends where e-commerce firms are focusing on profitability over expansion. The closure raises concerns about the viability of full-stack e-commerce enablers in a competitive market. Industry experts suggest startups must prioritize sustainable unit economics to thrive.
1. Understanding ANS Commerce: Working Model, Revenue Model, and Services
1.1 Founding and Growth of ANS Commerce
Founded in 2017 by Amit Monga, Nakul Singh, Sushant Puri, and Vibhor Sahare, ANS Commerce started as a full-stack e-commerce enabler, assisting brands in setting up and managing online stores. The startup aimed to bridge the gap between brands and digital sales by offering comprehensive solutions, allowing companies to focus on their products while ANS Commerce handled backend operations.
1.2 Services and Business Model
The company offered a full-suite of e-commerce solutions, including:
- Store Technology – Provided SaaS-based storefront technology, enabling brands to build and optimize their digital presence.
- Performance Marketing – Managed brand campaigns across platforms to maximize digital outreach.
- Marketplace Management – Helped businesses integrate with leading marketplaces like Flipkart, Amazon, and Myntra.
- E-commerce Warehousing & Fulfillment – Provided logistics support for brands, ensuring efficient order fulfillment.
1.3 Revenue Model and Financials
ANS Commerce operated on a SaaS-based subscription model, with additional revenues from commission-based services for performance marketing and marketplace management.
- The company raised $2.2 million in pre-Series A funding led by Gokul Rajaram and Venture Catalysts in 2021.
- Flipkart acquired ANS Commerce in 2022 for $35-40 million (INR 250-300 crore).
- Financial Performance:
- Revenue rose 39.4% from INR 39 crore in FY23 to INR 54 crore in FY24.
- Losses, however, widened 27.1%, reaching INR 73.8 crore in FY24 from INR 57.8 crore in FY23.
2. The Closure of ANS Commerce and Its Impact
2.1 Flipkart’s Official Statement
A Flipkart spokesperson confirmed the shutdown, stating:
“After careful consideration, ANS Commerce, a full-stack e-commerce enabler that was acquired by Flipkart in 2022, has decided to close its operations. As we wind down operations, we stay committed to ensuring a smooth transition for all stakeholders, including employees and customers.”
To mitigate the impact, Flipkart is offering internal opportunities, outplacement support, and severance packages to affected employees.
2.2 Industry Trends and Strategic Realignments
The decision aligns with broader e-commerce industry trends:
- Focus on profitability over expansion – With rising operational costs, e-commerce players are scaling back on non-core verticals.
- Increased competition in e-commerce enablement – With companies like Shopify, Unicommerce, and GoKwik offering scalable solutions, maintaining differentiation has become difficult.
- Economic pressures – Rising inflation and fluctuating market dynamics have forced businesses to optimize costs.
3. Learning for Startups and Entrepreneurs
3.1 Sustainable Unit Economics Matter
Many startups focus on growth at all costs, often ignoring profitability metrics. The downfall of ANS Commerce highlights the need for startups to build financially sustainable models rather than relying heavily on funding.
3.2 Strategic Acquisitions Do Not Guarantee Longevity
Even after being acquired by Flipkart, ANS Commerce could not survive. Entrepreneurs must thoroughly assess acquisition deals and ensure that post-acquisition integration aligns with their long-term vision.
3.3 Market Differentiation is Key
With competition from Shopify, Unicommerce, and others, startups need a strong unique value proposition to sustain in highly competitive markets.
3.4 Adaptability and Agile Decision-Making
Businesses must pivot and adapt to changing market demands. Sticking to outdated business models can result in operational inefficiencies and financial losses.
The Startups News: Bringing You the Latest in the Startup Ecosystem
When it comes to delivering insightful, data-backed startup news, The Startups News remains the go-to platform for entrepreneurs, investors, and business enthusiasts. Covering breaking tech stories, funding announcements, startup growth trends, and industry insights, we ensure that our readers stay ahead in the competitive startup ecosystem.
Stay updated with the latest startup news today and gain actionable insights into business strategies, funding trends, and industry transformations with The Startups News.