Loops raises USD $3.5 million for commerce AI push

Loops has raised USD $3.5 million in seed funding from a16z Speedrun, NTT Docomo, Connecticut Innovations, Alumni Ventures, and Monday Capital.

The San Francisco-based commerce AI start-up will use the funding for product development, customer deployment capacity, and international expansion. It sells a single AI system for retailers that combines search, product discovery, shopping assistance, customer operations, product enrichment, and virtual try-on.

Loops argues that many online merchants are adopting AI across separate parts of the customer journey, often through different tools. That leaves retailers to connect systems that each hold only part of the customer context, from product information to support history and shopper intent.

Instead, the company offers a single layer designed to follow the shopper from product discovery through purchase. It includes natural language search, a shopping assistant for customer questions, tools to rewrite product descriptions and attributes, and virtual try-on features.

Loops was founded by Ari Nazir and İlker Selim Zorluoğlu after what it described as a failed online purchase attempt. The founders identified a gap between the way shoppers were already using AI in plain language and the keyword search, filters, and separate support queues that still shape much of eCommerce.

The company says it now has more than 70 customers and pilots and has handled millions of shopper experiences. It also says 64% of pilots have converted into paying customers.

Retail focus

The company cited Turkish supermarket chain A101 and fashion retailer Mavi as examples. At A101, sessions involving the Loops platform showed roughly 83% higher observed purchase conversion than a comparison segment, though the company noted the result was observational rather than based on a randomised measure.

Mavi uses Loops' AI search and shopping assistance tools, allowing shoppers to search by style, occasion, or fit. The two examples reflect an effort to make online shopping resemble an in-store interaction, where the shopper explains what they want and receives guided help through the catalogue.

"The biggest mistake we see is treating AI as a collection of features," said İlker Selim Zorluoğlu, President and Co-Founder of Loops. "A retailer does not need five different AI products that each understand one slice of the customer. It needs one system that understands the catalog, the business and what the shopper is trying to do. Commerce is where we are proving that model, and we think the same architecture can eventually become the AI operating layer for other industries as well."

The broader market opportunity reflects the rush by retailers to deploy AI in areas such as search, customer service, catalogue management, and personalisation. While that can improve individual tasks, it can also create fragmented technology stacks and uneven customer experiences when systems are not connected.

Loops is arguing that retailers will prefer more unified software, particularly if product data, search behaviour, and customer conversations can be used together. Better catalogue data can improve search results, while shopper interactions can reveal missing or weak product information.

Investor view

Investors are betting that commerce is a practical starting point for a broader industry play. Loops plans to apply the same approach in other sectors, including financial services and energy, where specialist systems may be needed to manage industry-specific workflows.

That places the company among a growing group of start-ups trying to move beyond general-purpose AI tools into software built around particular sectors. In this model, companies seek to embed AI in day-to-day operations rather than add it as a standalone feature.

"AI is changing the interface between companies and their customers, but the lasting platforms will be the ones that can make it work reliably inside real businesses," said Fareed Mosavat, Investment Partner at a16z Speedrun. "Loops is starting in commerce, where the link between a better AI experience and business value is unusually clear. Its pilot conversion and early customer expansion show brands want a platform that can own more of that journey."