Kaffeen, founded in 2018 by brothers Hassan and Hashem Aljawad in Saudi Arabia, allows users to order coffee online and pick it up or have it delivered.
The deal allows Cofe to strengthen its e-commerce operations while solidifying its presence in the kingdom, the company said.
"We want to work with people who have the vision to change the way people access their coffee worldwide," said Cofe founder and chief executive Ali Al Ebrahim.
"With their [founders'] market expertise and experience on board, we are sure to reach out to even more coffee lovers across Saudi Arabia and beyond.”
Saudi Arabia's food and beverage market is the largest in the Middle East and was valued at $45 billion in 2020, consultancy JLL reported.
The kingdom's coffee market is expected to grow at a compound annual growth rate of 6.2 per cent between 2021 and 2027, a report by ResearchandMarkets.com said.
“We had launched Kaffeen with a mission to disrupt the online coffee market, and joining hands with Cofe, I believe, is the logical next step when it comes to bringing our mission to fruition,” said Mr Hashem, Kaffeen's co-founder.
Founded in 2018, Cofe is an online marketplace for coffee and all related accessories. The app allows users to order coffees, capsules, beans, coffee machines and associated products from shops or vendors hosted on its platform.
The company, which secured $10 million in funding last year, is planning to expand to new markets such as Turkey, Egypt and the UK. It also acquired UAE-based coffee marketplace Sippy Beans this year as it seeks to widen its offerings.
Cofe plans more acquisitions similar to Sippy Beans, Mr Al Ebrahim told The National last month.
The start-up this year won the backing of Abu Dhabi Investment Office and became part of its $545m Innovation Programme. After the investment, Cofe relocated its headquarters to Abu Dhabi.
"The acquisition of Kaffeen and Sippy Beans in the first quarter of 2022 are strong indicators that Cofe is looking to strengthen its reach within the region, before proceeding to expand first to Egypt and then overseas later this year," the start-up said on Wednesday.