Tausendkind: How Two Mothers Built a Million Dollar Online Shop

A few minutes into the interview it's clear to me that Anike von Gagern is one of the warmest and friendliest CEO's I've met. This is a good fit with the business she is running: tausendkind, a German online shop for baby and kids clothing & accessories.

A little over five years ago, tausendkind was only an idea carried around by Kathrin Weiss, Anike's business partner. Today they employ over 50 people and generate an eight-digit number in yearly revenue. That's no child's play.

Anike shares the story behind their exponential growth. How did two mothers build a million-euro business from the ground up? Surely there are some valuable lessons to be learned there.

Although she doesn't believe in "secrets to success" or "the blabla you read in business books", Anike does know what skills have been most valuable to her: "Setting priorities, following my passion, and knowing how to switch between strategic and operational thinking."

First Steps

The idea for Tausendkind was developed by Kathrin when she was working at McKinsey. Her second career was that of a godmother, and it was in this position that she got her hands on an Excel sheet that was making its round through the mother community. This list would change her life.

It contained info on special baby products and the addresses to get them. At this moment Kathrin realized that there was a huge need for unique baby items, one that was poorly addressed in the market. That’s when she developed the idea of a webshop where all these special items could be found in one place. After pondering on it for a few months, Kathrin decided to make the step. She kicked off with a few freelancers and built the website.

But building a business by yourself is a heavy burden. She needed a partner to share the adventure with. As she discussed this with Anike, her colleague at McKinsey that she'd always trusted with her ideas, her reaction was short and to the point: "How about me?". That’s how an online shop and two entrepreneurial careers were born.

Anike and Kathrin

Toddling

The startup truism about staying flexible fits tausendkind's story. The original idea was a niche shop with only those special baby products that couldn’t be found anywhere else. This was a good angle to distinguish the shop and get attention, but they soon realized it made sense to broaden the range to include ‘standard’ baby products as well, to become a one-stop-webshop.

The rare products went from being the main value to the factor that made tausendkind unique. This uniqueness is also the reason behind their reach: while the DACH region is most important, their unique offering ensures orders from all over the world.

Another metamorphosis was to include general children clothing into the mixture. You can't stop it: babies grow up. It made sense to extend to older ages to bind customers to the shop after their offspring’s first steps.

Walking Tall

Anike and Kathrin soon realized that they were in a good position. “When many people tell you how happy they are that you exist, you know you’ve found yourself a market fit.” What did change over the years was their steadily expanding scope of operations.

In marketing they had set a clear priority roadmap. They first focused on people that were very close to a buying decision. “When someone Googles with the keywords ‘buy baby towel’, you know that this person is likely to buy. All of our early marketing efforts were focused on catching these people via SEO and SEM.”

Once this group was covered, their priorities steadily moved up to the higher regions of the buying funnel. These efforts included a newsletter, social media presence, and an extensive blog for parental know-how’s and tips. "You can have nice attractors in place, but when people reach your website and you don't have the proper assortment and tools to convert them, you are wasting your energy."

Over time they also added affiliate and display marketing, “…but these only start making sense once you reach a certain size. The biggest mistake I see in eCommerce is marketing budgets being spent without a clear prioritization and measurement. You should have a clear plan of how you will spend your money.”

When I grow up…

When I ask CEOs/founders how they see their business in 10 years, they mostly present me with a Napoleonic vision of full market domination. Anike is different:

“We won’t become a global market leader. That would mean beating industry giants like Amazon, which just isn’t realistic and also not necessary. We want to be the best one-stop-webshop of high quality products for babies and kids. That is our priority and that is enough.”