Launching Oman’s first online food delivery platform, Akeed, was not easy for its founders. Gaurav Nahar, Moosa Al Lawati and Darshan Puranik struggled with a number of issues ranging from lack of funding to a shortage of workers at the time of its launch.
“I remember talking to about 40 investors before I finally had an investor who believed in our vision and believed in the kind of value we wanted to bring to the market,” says Nahar, recalling the company’s early days. .
The startup also experienced staff shortages in the early days as the founders worked to grow it.
“Myself…Darshan, all our team members even worked as drivers because initially we were short of drivers. We used to wait until evening for some orders and to make deliveries.
“We also worked in all the other departments, such as the call center [to receive orders]the marketing, the development of everything…the initial setup.
Akeed – an Arabic word meaning “safe” in English – overcame these challenges and launched in 2018 with seed funding of $120,000. The startup, which initially partnered with 15 restaurants to deliver food, has since expanded its network of partners to currently 1,500, capitalizing on a booming online food delivery market.
The global online food delivery market is expected to grow 11% to reach $192.16 billion in 2025, according to Business Research Company’s Online Food Delivery Services Global Market Report 2021.
In Oman, the online food delivery market is estimated at around $250 million, and there are plenty of opportunities for companies like Akeed to grow, Nahar said.
Applications related to e-commerce as well as food delivery businesses are just beginning to enter Oman’s market “creating initial large scale in the market”, he says. “The market is growing in the shape of a hockey stick [sudden rapid growth after a long period of linear growth] and it’s very similar to other markets like Kuwait where a lot of people still eat out.
In Oman, statistics show that on average, a person eats out 3.5 times a week. The trend should also benefit the online food delivery industry, Nahar adds.
Currently, Oman’s online food delivery market is dominated by Talabat, a leading regional player, and Akeed. There are also a few other companies trying to gain a foothold in the market.
“Oman is still a developing market and smartphone penetration has happened very significantly over the past three to four years,” Nahar said. The trend will benefit the online food delivery industry with “significant growth potential”.
But despite the potential for the Sultanate to flourish, Mr Nahar admits there were challenges, particularly amid the Covid-19 pandemic which has led to widespread movement restrictions around the world to curb the health crisis. .
“Each year we grew… for the first three years the pandemic hit us a bit hard, although the pandemic was successful for food delivery apps, in Oman it was a bit difficult. They had very severe confinements… 24-hour confinements for consecutive days. So it hurt our business,” Nahar says.
The slowdown in business due to the pandemic has also affected its funding process. However, he overcame the challenges and raised $2.5 million from investors including Phaze Ventures and Oman’s IDO Investments last year.
Established in 2018, Phaze Ventures is the first private venture capital firm in Oman that focuses on funding disruptive tech start-ups around the world. The company is targeting early stage startups in the Middle East and North Africa, Europe and North America with total funding of $30 million.
IDO Investments focuses on investing in globally established start-ups. He has investments in noninvasive weight loss solutions company Allurion, online car sales company Carzaty and clinical genomics analysis platform Congenica, among others.
Food delivery start-ups “require a lot of funding…there was a very limited appetite in the market. So that delayed some of our funding plans and didn’t finally materialize until September, October 2021. But now things are on the right track. We’re in talks with a GCC player on a merger and acquisition deal. So that’s going to bounce us back a lot more in the market,” Nahar says.
He did not name the company Akeed is in talks with.
“These are just happening and it’s almost made official. You’ll hear a big announcement very soon,” he says.
This agreement will change the ecosystem of start-ups in the sultanate and more investors will be encouraged to invest in technology companies, said the founder of Akeed.
Mr. Nahar, who grew up in Oman, decided to start Akeed with Mr. Al Lawati after noticing a gap for an online food delivery app in the country. There were no food delivery apps in Oman, even though the market offered great potential and despite the success of such apps in other Gulf countries.
“We thought it was kind of a proven concept and a very successful concept outside of Oman. So we both wanted to get out of all the business work and then start something new… start something that could add value to the market, to our personal lives as well. That’s why we chose this path of entrepreneurship to start something new,” says Nahar, who worked as a deputy director at global consultancy PricewaterhouseCoopers before founding Akeed.
The founders conducted extensive research before launch and “even validated the problem in the market by talking to restaurants, talking to customers, and the kinds of challenges or issues they face in terms of food delivery.”
“We got enough market validation to say this is a necessary service in the market. We started registering the company and started talking to many investors before finally launching in March 2018 after initial funding.
Akeed currently employs 300 drivers and has a cumulative customer base of 200,000 people in Oman.
“The future will be much better for us because we have international funds coming into the country and into our business. Maybe we can spend a lot more than we did before,” to drive growth, says Mr. Nahar.
Q&A with Gaurav Nahar, co-founder and CEO of Akeed
How do you see yourself and the company in the next five years?
It’s a question of funding…it’s like a car needs fuel to run. The new brand that will be part of Akeed [after merger and acquisition] will definitely want to expand across the GCC. We also want to be a game changer in terms of food delivery. We want to open more verticals and services that other players don’t offer and therefore we strive to be different.
How do you define your business?
This company is driven by passion, driven by a mission to change the [start-up] ecosystem of Oman. As we were the first to enter the market, we will also be the first technology company to obtain an M&A [deal]. We really want to make a difference in terms of the service and value we provide to the market.
What new skills did you learn during the business start-up process?
I have no experience as a CEO or managing a technology company, managing so many people or employees. So definitely [starting the company] helped me mature as a person in how to deal with different people, as well as how to deal with your board of directors. It tells you a lot about corporate governance. It teaches you all about a business, inside and out, from inception to such a grand scale.
What successful start-ups do you wish you had started?
The Indian Byju is an incredible start-up. Swiggy is also another… a very adamant and very fierce competitor to Zomato, and that’s why they got to the level they have. Amazon is, of course, another “very early” and game-changing tech company.
What is your mantra for success?
Loving what you do first is very important. Automatically, you will have a very good chance of succeeding. Properly planning your business is also very important for success. Being in the right environment, where the ecosystem supports you, as an entrepreneur, is also hugely important, as is hiring a great team.
Who are your role models in the business world?
Jeff Bezos, Elon Musk and Ratan Tata. These are the people I follow.
Updated: April 25, 2022, 4:30 a.m.