'Wake up and smell the coffee' with COFE APP
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The Food & Beverage sector in MENA has been evolving rapidly with the adoption of digital technologies and the facilitation of payment processes & structures. Despite the landscape being ever-evolving, investor interest in innovative F&B ventures has been steadily increasing throughout the years. Since 2018, capital invested in the MENA F&B space has been on a steady year-to-year growth, deploying 4,800% more funds this year by November 2021 compared to full-year 2018.
What makes the F&B space in MENA so unique is the eagerness for innovation by entrepreneurs in enhancing the food experience, and that has been reflective of the new early-stage ventures sprouting in MENA as well exceptional milestones by later-stage startups raising major rounds this year. Surely, the major story and largest funding round for F&B this year were centered around UAE-based Cloud Kitchen Tech startup Kitopi, securing 77% of total funding raised in MENA by November of this year. However, delivery startups across markets have gained impeccable investor traction, with startups like Breadfast, Foodics, Elmenus, COFE App, and Goodsmart raising tangible amounts this year.
Even though most F&B delivery startups in MENA share the same goal, providing scalable solutions to meet burgeoning market demands, some startups specialize in a niche offering optimizing their efforts on one product category. Of these successful startups is COFE App, disrupting the Coffee experience in MENA forever. After recording phenomenal growth over the past year and raising $10M in their latest Series B round, Ali Al Ebrahim Founder & CEO of COFE APP shares with us their core element of growth beyond Tech or Tech integration:
Your Very Own Online Coffee Marketplace, check out the COFE APP
While commodities across the board crumbled during the pandemic, there was one that continued to surprise everyone. The humble cup of coffee. Not only did it keep trade afloat but also cruised through one of the biggest economic crises of our time. To better understand the impact of the coffee market, it’s important to be aware of its economies of scale. Approximately 25 million smallholding farmers are responsible for 80% of the world’s coffee. The industry has 125 million people depending on it for their livelihood – with jobs covering everything from roasting the beans to sales, transportation, and farming.
In March 2020, the world as we know it suddenly came to a standstill. COVID imposed lockdowns forced people to stay indoors, because of which many businesses including coffee houses began to close their doors, in some cases permanently. However, this was not the case everywhere, for example the UAE. Owing to the country’s rapid response to the pandemic and the leadership’s leaning towards technology, people across industries were able to weather this storm. Limitations to movements, even if only temporary, led businesses to ramp up their delivery services. But the cup of coffee found a different way to continue being part of people’s daily routine, the pandemic brought to the fore home brewing. For many being able to “wake up and smell the coffee” brought to their day a small sense of normalcy.
From the brewery to your desk, your very own Coffee Marketplace.
This though is not the first time coffee has shown its resilience. Even during the financial crisis of 2008, as spending reduced, people continued to seek their daily cuppa. What is markedly different this time around is the rapid evolution of the industry. As people continue to work from home, the demand for home brewing is only increasing. This increased demand has caused disruptions in the supply chain, pushing up prices. Internationally, even as oil prices drop, coffee prices keep rising. According to Arabian Business, coffee has seen a 42 percent growth year on year.
In Europe, shares in coffee maker JDE Peet’s surged 15% in their stock market debut in May, as investors jumped on the only big European IPO launched during the COVID crisis. Over in Dubai, the Dubai Multi Commodities Centre (DMCC) Coffee Centre reported a record year across 2020 and processed and handled seven million kilograms of coffee and facilitated coffee shipments from 25 countries across Africa, Asia, and Latin America worth over AED 250 million (USD 68 million) throughout the year.
Local businesses are relishing the strength of this golden bean. The CEO of Emirati Coffee announced a record-breaking growth of 3% in online purchases in 2020 and hailed the UAE to be the most developed coffee market in the region. While two years ago there were fears that the market would endure saturation with the proliferation of specialty coffee shops, the pandemic has in fact had the opposite effect. The hunger for boutique roasters has only grown, areas once under-served in the more remote parts of the city now boast of a wide array of options from young local entrepreneurs who have led the fusion of the culture of coffee with the demand for quality.
Loyalty cultivated by roasteries owned and operated by locals have shown consistent returns right through the pandemic. These roasteries have gone from being mere coffee shops to important socio-cultural centers for the community.
As we enter what in the industry is termed as the “fifth wave” of coffee, the focus shifts from the spread of international chains to the rise of specialty coffee roasters; where loyalty, quality and personalized service become the harbingers of success.
And now adding e-commerce to this mix is expected to herald an exciting future for the industry. From online sales to marketplace platforms like COFE App, it’s going to be interesting to watch how the coffee industry evolves, not just now but well beyond the pandemic.
Looking to grasp this startup landscape? Browse 360+ F&B Startups in MENA