iKcon, a Dubai-based tech-enabled cloud kitchen as a service operator, was founded by Khalid Baareh and Kareem Abughazaleh. Courtesy iKcon
iKcon, a Dubai-based tech-enabled cloud kitchen as a service operator, was founded by Khalid Baareh and Kareem Abughazaleh. Courtesy iKcon
iKcon, a Dubai-based tech-enabled cloud kitchen as a service operator, was founded by Khalid Baareh and Kareem Abughazaleh. Courtesy iKcon
iKcon, a Dubai-based tech-enabled cloud kitchen as a service operator, was founded by Khalid Baareh and Kareem Abughazaleh. Courtesy iKcon

Business

Dubai cloud kitchen start-up iKcon raises $20m to expand into Saudi Arabia

The latest round brings iKcon's total funding to $32m

Mary Sophia
Mary Sophia
Abu Dhabi

March 28, 2021

  • English
  • Arabic

Dubai-based cloud kitchen start-up iKcon raised $20 million in a Series A round to fuel its expansion into Saudi Arabia.

The round was led by regional investment groups including Mohamed Yousuf Naghi Group, AlTouq Group, Derayah Ventures, B&Y Venture Partners, AbdulMohsin Al Houkair Holding Group, and Nazer Group, the company said in a statement on Sunday.

The latest round brings iKcon's total funding to $32m and will help it expand regionally and improve its technology.

Cloud kitchens, or ghost kitchens, are commercial establishments that produce food specifically for delivery and do not provide dine-in services or takeaway. The global ghost kitchen market is expected to be valued at $71.4 billion by 2027, up from $43bn in 2019, according to Statista. Cloud kitchen revenues within the UAE and Saudi Arabia grew 160 per cent year-on-year to reach more than $65m in 2019, a report by RedSeer Consulting showed.

Increasing popularity of the food delivery segment amid the pandemic has further fuelled the popularity of such entities.

"We are laser-focused on further developing our technology to accelerate the evolution of data analytics, process automation, and AI as a key differentiator in how we operate in our fast-growing sector," said Khalid Baareh, chief executive of iKcon.

Founded in 2019 by Mr Baareh and Kareem Abughazaleh, iKcon currently operates 15 cloud kitchens across the UAE. It aims to grow its network to 50 cloud kitchens but did not provide a timeline to achieve this target. The company has more than 650 employees.

Cloud-kitchen companies in the region have been popular among venture capitalists and other investors as the Middle East's food delivery market becomes lucrative.

Dubai-based Kitopi raised $60m in a Series B round last year and said the funds would allow it to add 100 more locations around the world by the end of this year.

Another cloud-kitchen Sweetheart Kitchen raised $17m last year and is also reportedly backed by DeliveryHero, the parent company of Talabat.

War

Director: Siddharth Anand

Cast: Hrithik Roshan, Tiger Shroff, Ashutosh Rana, Vaani Kapoor

Rating: Two out of five stars 

The national orchestra
World record transfers

1. Kylian Mbappe - to Real Madrid in 2017/18 - €180 million (Dh770.4m - if a deal goes through)
2. Paul Pogba - to Manchester United in 2016/17 - €105m
3. Gareth Bale - to Real Madrid in 2013/14 - €101m
4. Cristiano Ronaldo - to Real Madrid in 2009/10 - €94m
5. Gonzalo Higuain - to Juventus in 2016/17 - €90m
6. Neymar - to Barcelona in 2013/14 - €88.2m
7. Romelu Lukaku - to Manchester United in 2017/18 - €84.7m
8. Luis Suarez - to Barcelona in 2014/15 - €81.72m
9. Angel di Maria - to Manchester United in 2014/15 - €75m
10. James Rodriguez - to Real Madrid in 2014/15 - €75m

Winners

Ballon d’Or (Men’s)
Ousmane Dembélé (Paris Saint-Germain / France)

Ballon d’Or Féminin (Women’s)
Aitana Bonmatí (Barcelona / Spain)

Kopa Trophy (Best player under 21 – Men’s)
Lamine Yamal (Barcelona / Spain)

Best Young Women’s Player
Vicky López (Barcelona / Spain)

Yashin Trophy (Best Goalkeeper – Men’s)
Gianluigi Donnarumma (Paris Saint-Germain and Manchester City / Italy)

Best Women’s Goalkeeper
Hannah Hampton (England / Aston Villa and Chelsea)

Men’s Coach of the Year
Luis Enrique (Paris Saint-Germain)

Women’s Coach of the Year
Sarina Wiegman (England)

Score

Third Test, Day 2

New Zealand 274
Pakistan 139-3 (61 ov)

Pakistan trail by 135 runs with 7 wickets remaining in the innings

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The Melbourne Mercer Global Pension Index

The Melbourne Mercer Global Pension Index

Mazen Abukhater, principal and actuary at global consultancy Mercer, Middle East, says the company’s Melbourne Mercer Global Pension Index - which benchmarks 34 pension schemes across the globe to assess their adequacy, sustainability and integrity - included Saudi Arabia for the first time this year to offer a glimpse into the region.

The index highlighted fundamental issues for all 34 countries, such as a rapid ageing population and a low growth / low interest environment putting pressure on expected returns. It also highlighted the increasing popularity around the world of defined contribution schemes.

“Average life expectancy has been increasing by about three years every 10 years. Someone born in 1947 is expected to live until 85 whereas someone born in 2007 is expected to live to 103,” Mr Abukhater told the Mena Pensions Conference.

“Are our systems equipped to handle these kind of life expectancies in the future? If so many people retire at 60, they are going to be in retirement for 43 years – so we need to adapt our retirement age to our changing life expectancy.”

Saudi Arabia came in the middle of Mercer’s ranking with a score of 58.9. The report said the country's index could be raised by improving the minimum level of support for the poorest aged individuals and increasing the labour force participation rate at older ages as life expectancies rise.

Mr Abukhater said the challenges of an ageing population, increased life expectancy and some individuals relying solely on their government for financial support in their retirement years will put the system under strain.

“To relieve that pressure, governments need to consider whether it is time to switch to a defined contribution scheme so that individuals can supplement their own future with the help of government support,” he said.

War on waste
EA Sports FC 26

Publisher: EA Sports

Consoles: PC, PlayStation 4/5, Xbox Series X/S

Rating: 3/5

The biog

Age: 46

Number of Children: Four

Hobby: Reading history books

Loves: Sports

Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

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