Generation Start-up: Dubai's Fruitful Day ripe for GCC expansion after surviving Covid-19 headwinds
The healthy snacking company is looking to expand into Saudi Arabia in 2021 after it secured Dh3m in two funding rounds this year
Dubai’s fresh snack company Fruitful Day has stood the test of Covid-19. It not only survived the pandemic but thrived.
Marie-Christine Luijckx, co-founder and managing partner, says the company’s agile business model allowed it to adapt to a sudden shift in operating conditions and customer focus.
Fruitful Day was born out of the need for healthier snacks to help lift workaholic corporate executives at the Dubai International Financial Centre from their midday energy slump.
With long hours, hectic schedules and not enough time to grab a proper meal, executives largely relied on vending machines in offices that mostly dispensed junk food.
Ms Luijckx, a former banker with Deutsche Bank and Barclays, experienced the unhealthy eating routine herself and decided to launch Fruitful Day in 2015 with co-founders Lyla AlRawi and Lindsey Fournie.
It was a win-win situation for the company and its corporate subscription clients as the business took off. After years of consistent growth, the partners decided to scale up and evolve into a “premium” healthy lifestyle and snack company.
As deliveries exceeded more than 1,000 a week, Fruitful Day ran out of space at its packaging and processing unit, which was less than 139 square metres. It moved into a new base of operations that is five times larger at the beginning of this year.
The move was an expensive undertaking. The co-founders, who had "bootstrapped" the company for four years, were in early talks with investors to help foot the expansion bill. However, the sudden economic shutdown in the first three months of the year brought operations to a grinding halt.
“We had a lot of resources at hand [with the expansion] when offices started to shut and the corporate subscription business went on hold overnight,” says Ms Luijckx.
“We pivoted very quickly. We already had some home customers, but we really doubled down on the home segment and we were able to reallocate resources quickly there.”
Fruitful Day’s corporate business, which accounted for 60 per cent of total sales before the pandemic, now accounts for less than 20 per cent due to the shift in the company’s business model, she says.
Conversations with investors, which began before Covid-19, continued and Fruitful Day proved it could grow despite having most of its corporate business on hold.
The turnaround did not go unnoticed and the company raised Dh3 million ($816,771) in two successive fundraising rounds in November. It managed to garner investors’ attention from as far away as Switzerland and Singapore, as well as from Saudi Arabia and the UAE – bringing on board 40 new investors.
The company surpassed its original target as it raised funds through global equity crowdfunding platform Eureeca, which helps members invest in high-growth start-ups.
Fruitful Day’s management was able to quickly “react and switch their focus”, said Siddarth Dalamal, head of investor relations at Eureeca, last month when the funding rounds were announced.
“By delivering record numbers throughout a very difficult period, they showed their mettle and won investor confidence, causing the round to be oversubscribed.”
The venture now sits on top of a cash pile that it plans to use to come up with new products and expand, says Ms Luijckx.
It will use a third of funds to cover the cost of growing its business outside the region and split the remaining amount equally on product development and GCC expansion.
An entry into Saudi Arabia is next on the cards, she says.
“We have proved that the model works here in the UAE and we would like to explore opportunities in other GCC countries, in particular Saudi Arabia,” says Ms Luijckx.
“We are hoping to take first steps in that direction in the second half of 2021.”
Early into its entry into Saudi Arabia, Fruitful Day plans to minimise its fixed assets and operate a lean structure as it gauges how consumers respond to its products.
“Then, as we have done here in the UAE, [we will] continue to listen to the clients to see where the opportunities are and double down where we see them,” she says.
Despite the pandemic, the company diversified its product range and launched a new line of fresh fruit pops and cold-pressed juices.
“As with our other products, we wanted people to be excited to make the healthy choice. They have been off to a fantastic start,” says Ms Luijckx.
Although Fruitful Day delivers products across the Emirates, Dubai remains its single largest market. It now plans to expand its customer base in Abu Dhabi and Sharjah.
“We are moving into dark kitchens in both locations [to] reduce delivery times and expand our reach,” she says. “If the model proves [to be a success] there is no reason why we cannot do it in other places.”
The company’s latest funding round was done with “an 18 month-runway in mind” and, in terms of immediate goals, “we are all set to execute them now”, says Ms Luijckx.
The start-up may consider bringing on strategic investors with deeper pockets in the future but there are no immediate plans for that, she says.
The pandemic has radically altered the business and it is unlikely that it will “ever go back to what it was”, she says.
“I don’t think this will stay like this either [as] we are always on the hunt for the next opportunity and we will keep on continuing to grow.”
Q&A with Marie-Christine Luijckx, co-founder and managing partner at Fruitful Day
What successful start-ups do you wish you had started?
I’m working on the business plan of another start-up now, stay tuned! I think once you have the entrepreneurial bug, it’s hard to shake it.
What is your vision for the company and where do you see it in next five years, given that Covid-19 has radically altered its model?
I am part of a group of entrepreneurs called the “Entrepreneurs’ Organisation” and they recently had us do an exercise where we visualised ourselves leading our company five years from now. My vision is that Fruitful Day becomes the premier fruit and health snack company in the Middle East, but equally important to me is that the culture of the company remains as happy and vibrant as it is today. Although we have pivoted from office to home deliveries, for us, the focus on health and happiness internally and externally has not changed.
What is your mantra for success and where do you see yourself in the next five years?
Success is a combination of hard work and good luck, but you can help your chances of good luck by putting yourself out there. When you say "yes" to helping others, meeting new people and exploring things that scare you, you will inevitably get new perspectives and find a way to be more successful.
What is your next big dream?
Professionally, I have two big dreams: to enter grocery stores and bring the deliciousness of Fruitful Day to Saudi Arabia. We have aggressive plans for 2021 and the right team in place to execute so I am as excited for Fruitful Day today as I was the day I started it.
What new skills have you learnt in the process of starting the company and running it?
The most important skill I have learnt since starting Fruitful Day is resilience. Whether you are starting or scaling a business, something new will challenge you each and every day. Some days the challenges seem insurmountable, but somehow you always have to figure it out because quite frankly the buck stops with you and people are depending on you. Over time, you realise you learn to recover more quickly from these difficulties and learn to trust in your ability to do so.
How do you envision a post-Covid-19 world for struggling entrepreneurs?
We have all learnt a lot of lessons this year, which I hope we do not easily forget. The businesses that start-up and scale during and post pandemic, I believe will be stronger as a result. For example, they will understand the importance of keeping a cash reserve and embrace alternative business models, which may not have been considered pre-Covid.
Updated: December 27, 2020 12:39 PM