UAE start-up GrubTech expands to Egypt

Technology platform for restaurants and cloud kitchens plans to invest $5m in the North African country over next 12 to 18 months

GrubTech chief executive Mohamed Al Fayed (left) and Egypt country manager Osama Harfoush. Photo: GrubTech

The UAE’s GrubTech, a platform that digitises the back-end operations of restaurants and cloud kitchens, has expanded to Egypt, further diversifying its regional operations.

GrubTech plans to invest $5 million in the Arab world's third largest economy and most populous county over the coming 12 to 18 months, as it seeks to make Egypt its springboard for Africa expansion, the company said in a statement on Wednesday.

“I am so pleased for launching our operations in Egypt, which is one of the most important markets in the region,” said Mohamed Al Fayed, GrubTech’s co-founder and chief executive.

“There is a huge number of restaurants in the local market serving a large segment of the country’s population, which is a great opportunity for GrubTech to serve its clients through availing an easy-to-use integrated system,” he added.

With a population of 103 million and a median age of 25 years, Egypt has enormous potential. Egypt’s restaurants have experienced robust growth, with an estimated size of $17 billion annually, according to Egyptian cloud kitchen services operator The Food Lab.

Cloud kitchens, or ghost kitchens, are commercial establishments built to prepare food specifically for delivery and they have benefitted from the shift to online services during the coronavirus crisis. They have no physical presence as a restaurant, and offer delivery-only services from centralised premises through a mobile app.

The global cloud kitchen market is forecast to grow to $71.4bn by 2027 from about $43.1bn in 2019, according to Allied Market Research.

Founded in 2019 by Mr Al Fayed, Mohamed Hamedi and Omar Rifai, GrubTech enables its clients to digitise operations and management of online food orders and provides them with data to help streamline expenses.

Companies such as GrubTech have seen business pick up as the Covid-19 pandemic pushed the food industry online and established new habits.

GrubTech partners with food delivery aggregators, such as Talabat and Delivery Hero, and serves delivery-centric restaurants and delivery-only cloud kitchens, also known as dark or ghost kitchens.

GrubTech has raised a total of $18.4m, including $2m in a seed round in 2020, $3.4m in a pre-series A round in March of last year and $13m in a series A in December.

Proceeds from its latest funding, which was led by US-based Addition with participation from Mena-focused venture capital firms BY Ventures and Hambro Perks Oryx Fund, were earmarked for expansion to new markets.

The start-up now has offices in Egypt, Sri Lanka, Turkey and the UAE with 140 employees, and serves clients in 17 countries.

The Cairo office plans to double from 20 people to 40 in the short term, GrubTech Egypt country manager Osama Harfoush told The National.

“The Egyptian market is huge; it contains hundreds of thousands of restaurants and has a massive potential,” said Mr Harfoush, who previously served as Egypt country manager for delivery platform as well as regional operations manager for social traffic crowdsourcing app Wasalny.

In March, GrubTech signed a partnership agreement with Cairo-based digital payments service provider Paymob in a move that allows restaurants and cloud kitchens in Egypt to efficiently manage their payment systems through the GrubTech platform.