RIYADH: There are few sectors to have been hit harder by the pandemic than restaurants, but that hasn’t stopped Foodics from expanding its business into new areas of retail over the past 18 months.
In October 2020, six years after starting out as a point-of-sale (POS) solution for restaurants, Ahmed Al-Zaini and his partner Mosab Al-Othmani launched Foodics Capital, a micro-lending business allowing it to offer loans of as little as $5,000 to small food and beverage companies.
Foodics Now, a platform that enables restaurants to start their own website or mobile app to sell online, was recently launched. Its latest venture, Foodics Retail, brings its offering to a whole new set of customers beyond the restaurant industry.
Al-Zaini gives the example of a small [retail] startup from outside Saudi Arabia that is gaining market share in the Kingdom due to its partnership with Foodics.
“We also aim to be an enabler to the wider [retail] market, including the startup community,” he said. “Working together we can grow faster and have a bigger market in which to invest. We are very thankful to all our clients, investors and partners who have trusted us and helped us on this journey.”
Foodics Capital fits neatly into its current offerings as it can assess potential borrowers’ creditworthiness through the POS transaction data it has access to, while loan repayments can be made by deducting a slice of credit- and debit-card payments made through its platform.
“We are now a market leader in Saudi Arabia but our objective is for Foodics to be a market enabler,” Al-Zaini told Arab News in an interview. “We have a software marketplace with more than 300 partners, with local and international players completely integrated with our solution and ecosystem.”
“We cater to every segment of the food and beverage sector from traditional dine-in restaurants, cafés, fast food outlets, bakeries, food trucks through to cloud kitchens and retail operations.”
Starbucks, Jolt, Dunkin Donuts, and Burgerizzr are among its well-known customers.
Founded in 2014 in Alkhobar, Foodics expanded to Riyadh and Jeddah, before launching in Dubai in 2017 and Egypt in 2020.
The business now has more than 53,000 terminals catering to over 12,000 stores in 25 countries, and more than 200 employees in five countries.
It raised $20 million in February in a Series B round led by Public Investment Fund subsidiary Sanabil Investments and STV, bringing total funding to $28 million.
That round was to help increase Foodics’ market penetration in Egypt, consolidate its position in existing markets and develop new products such as Foodics Now and Foodics Capital.
However, the global pandemic has significantly affected Foodics’ revenue as well as the industry it serves and redirects.
“Definitely, these have been tough times. There is no single international expert who knows what the impact on the industry will be. Foodics’ mission is to make an impact on the food and beverage industry by helping business owners overcome foreseen and unforeseen challenges, such as the recent pandemic, through digital technologies.
“We sense that there is an impact on the [gross merchandise volume] of our customers, and we had 90 percent of stores completely locked down at some point during the pandemic,” he said.
“This was really serious at that time. The good thing is that we remained strong, and proactively fast tracked our product development in order to best support the ecosystem through the crisis. We are also not just in one country — we operate internationally in Dubai, Kuwait, Jordan and in Egypt, so we benefit from their support as well."
More optimistically, Al-Zaini is seeing a massive expansion of small businesses, especially in Saudi Arabia and Egypt, even as some companies are closing and exiting the market due to the pandemic.
“Our focus has changed since our inception, we are focusing more on small businesses and micro-businesses,” he said. “New local concepts are being launched, brands are expanding and acquiring some successful local brands, so this is an opportunity for us.”
As to where this could lead Foodics in the future, Al-Zaini says no decision has been made yet.
“We are studying all options,” he said. “Listing on Nomu or Tadawul is definitely a promising option which we are studying, and have advisers to suggest the best direction, but we have not made a decision as yet.”
