FireSide 2022: MAGNiTT Invites Foodics
Up close and personal with MEAPT's most prominent players in the ecosystem. The Series Interviews the players shaping their respective industries in a casual conversation with MAGNiTT. Today we invite Foodics (KSA) COO Djamel Mohand
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3 questions, 1 player, and endless insight. Welcome to the "FireSide 2022" content series where we reflect on trends, industries, investments, and venture capital in the Middle East, Africa, Pakistan, and Turkey. For today's FireSide chat, we invite KSA-based Foodics' COO Djamel Mohand:
In light of your latest acquisition of Jordan-based POSRocket, What have been some major drivers for Foodics' growth and success in the GCC market, and what is the importance of geographical expansion across MENA?
The most important driver for Foodics’ growth and success in the GCC, is our knowledge of the market. As a whole, it is a big market and also very fragmented. Understanding the local landscape, its diverse cultures, the local technological players, and the behavior of the business owners is the key and the most important aspect to be successful across the region.
That’s why we don’t see big international players in our space in the region, because they don’t master that knowledge of the ecosystem, of the culture, and of the countries. This is also why we have acquired POS Rocket, in order to consolidate a market that is very fragmented. The business owners in Alexandria, Egypt are not the same business owners you will find in Kuwait City or in Riyadh. Our success is based on being able to master all that.
Our ability to dig deeper into the ecosystem is what drove our recent acquisition.
Could you identify the untapped potential in the GCC F&B market, for example, the rise of super apps for users and consolidated platforms for businesses? How could that differ in other markets across MENA?
The potential of the GCC F&B market is huge.
We are talking about a region with almost half a million restaurants, and out of that more than 60% of these restaurants don’t have any technology stack, so the potential is huge. With recent changes in regulations, such as the mandatory e-invoicing in Saudi Arabia for example, these changes are helping us significantly in driving and accelerating digitalization across the sector.
If we have to compare this to super apps, I would say it is a little bit different. The need for new verticals is here. At Foodics we are offering finance solutions, payment solutions, supply solutions, etc. but these are not real verticals. We are talking here about software and technology operations that we are already using and adding these to our portfolio to be able to provide them from the Foodics, under our “one-stop-shop” model.
What we are NOT doing, is forcing restaurants to adopt new business models or new products. With Foodics, for example, our clients can have their own accounting software, which they can either integrate with Foodics or buy directly from Foodics. This is where the untapped potential is, especially for us.
With an almost 300% YoY growth in VC funding across KSA in 2021, the Kingdom has reached a new record-high capital deployment crossing the $500M mark. With the support of positive government regulations and Sandboxes and keen investor interest, the FinTech sector climbed 3 ranks to become the industry attracting the most deals in 2021. Dive into KSA's top-performing industries, most impactful Exits, and the Kingdom's VC dynamic in this extensive KSA 2022 Venture Investment Report brought to you by the Saudi Venture Capital Company (SVC).
Talking about the importance and impact of your recent acquisition, what is Foodics' growth strategy for the upcoming year and how does it align with the growth of the F&B/Tech spaces in GCC & MENA?
We see a lot of tech ventures raising funds to scale at a regional level, not anymore at a country level. Usually, tech startups that were established in the UAE, were trying to capture the UAE market first and then trying to capture other markets in the region. Today, however, the trend is that we try to have a regional approach from the offset, understanding that perceiving regional market as one whole makes it one of the major world markets.
We are talking about half a million restaurants, 5 to 6 million businesses in general, and it is a huge market once consolidated. That’s why we try to have that regional approach whilst also having strong localization efforts in all countries, similar to what Careem has done, and has made their success.
At Foodics, we are always working on these two aspects, and the tech ecosystem is doing the same, which is strong localization in each country but looking at the GCC as a whole as one of the major global markets. That’s our growth strategy and it is really aligned with what other tech players are trying to do in the F&B/Tech spaces in GCC & MENA, so we are confident we are adopting the right strategy.
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