Kitopi, a cloud kitchen startup based in Dubai, has raised $415 million in a Series C round backed by SoftBank's Vision Fund 2. It is one of the largest venture-backed startup financing rounds in the Middle East and North Africa. It's also SoftBank's first investment in a Middle Eastern startup. Kitopi would not reveal the valuation, but told MENAbytes that it is over $1 billion, making it the third and fastest Middle Eastern unicorn to date.
Kitopi, a network of over 60 cloud kitchens throughout the United Arab Emirates and the Middle East, was founded in 2018 by Mohamad Ballout, Saman Darkan, Bader Ataya, and Andy Arenas.
Through its cloud kitchens, the three-year-old firm partners with food and beverage brands to help them expand their reach. The firm handles everything from food preparation through delivery, and it collaborates with eateries on a revenue-share basis. It works with over 200 brands, according to its website.
The company's competitive advantage, according to a statement, is its unique Smart Kitchen Operating System, a suite of software that optimises the performance of its cloud kitchen operations in real-time. It enables Kitopi to handle several brands in a single kitchen while also increasing operational efficiency. According to the statement, “one application, for example, uses data science to forecast when drivers will arrive and how long a menu item will take to prepare, then auto sequences which things are cooked first to improve speed.”
Kitopi's kitchens have been able to double order volume while cutting preparation time by 40% since its launch three years ago. In the previous year, the company has expanded into subscription-based meal plans and grocery delivery. In 2020, the company's overall revenue increased by 300 percent.
“Constraints placed on the hospitality sector by the worldwide pandemic have quickly turbocharged the value proposition of cloud kitchens for customers and restaurant brands,” said Faisal Rehman, Managing Partner of SoftBank Investment Advisers. Kitopi's innovative technology, we think, is transforming the unit economics of food delivery by giving customers more options in more areas. We're also happy to welcome Kitopi as SoftBank's first investment in the UAE, and we're optimistic about the company's future prospects in the area and beyond.”
In early 2020, Kitopi raised $60 million in a Series B round.