Interview: Cloud kitchen Kitopi is now investing in bricks-and-mortar restaurants

Cloud kitchen company Kitopi, backed by SoftBank Group Corp, is adapting to a post-Covid world using a hybrid model, where dine-in concepts are combined with delivery. Restaurant food delivery saw an unprecedented surge during the height of the pandemic, but as countries continue to loosen Covid restrictions, Kitopi, like F&B businesses everywhere, must adapt. The company hinted at expansion outside the region earlier this year, but Sabine El Najjar, Managing Director, KSA, said while international markets are part of the company’s long-term plan, current focus is on its existing markets. According to El Najjar, Kitopi is now seeing the demand for dining in returning. “While Kitopi’s early focus had been on delivery, with our investments in brands recently, we’ve expanded our offering to enable customers to engage in new ways beyond online ordering and delivery,” she said. It now operates on what it refers to as an “omnichannel” basis, with dine-in restaurants, cloud kitchens and food halls in one venue. The implication is that Kitopi will follow the direction of greatest demand going forward: “Our multi-brand vision will take us towards a future where we will be bringing customers a food experience through multiple channels, be it dine-in, delivery or pick up,” said El Najjar. “We will continue to grow all aspects of our cloud kitchen and dine-in business as we innovate and optimise our kitchens to be able to cater to all these experiences.” Kitopi is not simply changing from online to brick and mortar but providing a combination of both, said El Najjar: “The future demand we see is a hybrid of both on-demand delivery and in-person dining, to meet a variety of lifestyle and preferences. Therefore, rather than moving towards brick-and-mortar restaurants from cloud kitchens, we are providing consumers with choices, for them to enjoy food experiences in ways that suit them best.” Investment Founded in 2018, Kitopi has attracted much investor attention, with funds raised reaching $715 million as of an extended Series C investment round of $300 million in late 2021. It has invested “a few hundred million” in brands across its five markets, including those it refers to as “local heroes”: the UAE’s Go!Greek, Right Bite, Pizzaro, 800 Pizza, and Shobak and Wokong in Saudi Arabia. It now employs 4,000 people and works with 200 brands in total, one of its original core functions being to work with F&B businesses, facilitating their expansion, within their own territories or abroad, within 14 days. The Future Kitopi operates in five GCC states the UAE, Saudi Arabia, Kuwait, Bahrain and Qatar with an engineering hub in Krakow, Poland, and a global customer experience centre in Dubai. “Our focus now is on building a sustainable business with the highest levels of operational standards,” El Najjar said. “This means our current focus will be on existing markets, where we will continue to innovate to bring the best food experiences for our customers and build on our vision to satisfy the world’s appetite.” Kitopi’s UAE headquarters will continue to manage the business within the emirates as well as its global operations, and the Saudi Arabian regional HQ will manage the GCC business, El Najjar said. Regarding the future, El Najjar said the company was anticipating more changes in technology, food trends and consumer behaviour. “What you can count on us to do, firstly, is to continue to grow in all the markets that we are in today,” she said. “Secondly, you can count on us to be at the forefront of innovation in the food space, pushing ourselves to set the bar high on consumer experience.” (Reporting by Imogen Lillywhite; editing by Seban Scaria) (imogen.lillywhite@lseg.com)

Interview: Cloud kitchen Kitopi is now investing in bricks-and-mortar restaurants

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