Appetito, the Egyptian platform that delivers groceries and household products to customers from 11 dark stores across three cities in the North African country, is acquiring Lamma, an identical startup with operations in the Maghreb regions of Tunisia and Morocco.
The deal is expected to close by the end of Q3 2022.
Appetito didn’t disclose the size of the deal in its statement, and neither did CEO Shehab Mokhtar when quizzed about it via email. But sources familiar with the matter said the deal size was between $10 million to $15 million. Mokhtar declined to comment on the speculated price.
“We’ve been very cost-efficient with solid unit economics from day one. The fact that we were able to do so much with so little is great evidence,” replied Mokhtar when asked how Appetito financed the acquisition, having raised just $2.5 million. “Moreover, we’ll be closing an eight-figure round soon to foster our expansion even further.”
The acquiree, Lamma, launched in Tunisia as a carpooling service two years ago. It pivoted to a quick commerce platform delivering groceries, personal care and fashion items to users in Tunisia and Morocco (launched this year) in less than 45 minutes. Lamma was founded by CEO Yassir El Ismaili El Idrissi, ex-GM at Careem, Hamza Guesmi and Koussi Aymen — and is backed by Orange Ventures.
The Lamma team, its three dark stores, and a distribution center will be integrated into Appetito as both teams “explore lots of synergies.” El Idrissi will join Appetito as its chief expansion and growth officer.
Appetito said the deal makes it the largest q-commerce player in Africa. Its claim is based on the number of markets it currently operates in: Egypt, Morocco and Tunisia. “No other q-commerce player in Africa operates in such big markets,” Mokhtar told TechCrunch.
The company said it plans to become the largest q-commerce player in frontier and emerging markets. Similar upstarts such as Rabbit have operations in Egypt and Saudi Arabia, while older players like Breadfast, though only operational in Egypt, runs more than 50 dark stores.
Since the pandemic hit, q-commerce platforms have been subject to a lot of VC interest — and cash — as consumer habits changed and people shopped for groceries online with the expectation to get them in minutes, as promised by these platforms.
But as the number of platforms offering grocery and household items delivery under 20 minutes grew, it became apparent that most wouldn’t survive with their little margins and questionable unit economics. A consolidation began late last year. Big players such as Getir, Flink, Gorillas and Gopuff have since acquired smaller platforms like Weezy, Cajoo, Frichti and Dija.
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