They’re democratising lunch by making it available for just $7 (AED25) with daily options. Last week, the food tech start-up Lunch:On closed $3 million in equity financing, marking the first closing of its Series A round. Co-founders Dana Baki and Mohammad Al Zaben tell Arabian Business what their next move is.
Why the decision to launch Lunch:On?
Lunch:On was born out of our founders' passion for food and mutual frustration over ordering food at work. People are spending more and more time at work these days, and finding consistently delicious, convenient and affordable options was a daily struggle, especially with everyone’s busy work schedules.
What will you do with the new round of investment?
This new round of funding will go towards raising consumer awareness and scaling customer acquisition across the UAE. In addition, we plan to launch the service in Saudi Arabia very soon.
Do you have any expansion plans across the GCC or Middle East? Please share them.
Yes, we plan on launching first in Riyadh and using that as a springboard to launch in other large cities in Saudi Arabia and the wider GCC.
What is your business model?
Lunch:On, in essence, serves as your company’s food partner, and creates a win-win for both customers and restaurants. Office workers are looking for good lunches that can be delivered at reasonable prices. Restaurants, on the other hand, have spare capacity in the morning that they can put to profitable work. We connect these two parties together. By consolidating orders by office buildings, and delivering to the same place at the same time, we are able to eliminate delivery fees and negotiate better pricing with restaurant partners.
How is Lunch:On performing at the moment?
We’ve been overwhelmed and thrilled by the response it has received from both customers and restaurants. We have been growing exponentially month over month for the past 3 years. However, looking at the size of the opportunity in the region, we've barely scratched the surface. This new round of funding will go towards raising consumer awareness and scaling customer acquisition across the UAE. In addition, we plan to launch the service in Saudi Arabia very soon.
The competition in the F&B delivery space is rising fast. How are you dealing with that?
We are only focused on companies and their employees, and we are capitalizing on rapidly-changing food ordering habits and customer demands. We've cracked a model that takes order consolidation to the next level and utilizes the restaurants’ excess capacity to provide working professionals with a curated offering at a much cheaper price point. This is the premise on which Lunch:On is built, and it is what makes it advantageous for customers and restaurant partners. We have more recently launched our catering platform that gives office admins a simple way to get catered food for their internal meetings and events.
Companies are now able to order platters, plan food for any kind of event or order the traditional Lunch:On boxed meals for their teams, with just a few clicks. This part of the business has taken off quite nicely, as we have learned that corporate catering is a huge pain point for those involved, that no other regional players are addressing adequately.
Do you predict more delivery apps to launch in the UAE? Will the market become saturated?
We can’t say for certain whether any new food delivery companies will launch in the UAE but any new entrants will need to be able to clearly differentiate themselves in order to succeed.
The food delivery market in the UAE is a massive market which is still growing at 25 percent per year so there is still plenty of room for competition and innovative ideas within the space.
What were some of the challenges you faced when you began the business, and what are the challenges you currently face? Please explain.
At the beginning, you’re really just starting out with an idea and the biggest challenge is building the initial team that is as passionate as you about the problem you are solving. As you grow, there’s really no shortage of challenges. The biggest, I would say, is discovery and building awareness, and essentially getting people to know about your company.
How is Lunch:On funded, and how much funding does it take to launch such a business?
We originally personally seeded the company with $100,000, which enabled us to build an MVP, hire our first core team members and operate for six months. We then raised $500,000 in a Seed round before raising our Series A.
If you could go back and do one thing differently with Lunch:On, what would you do?
Hindsight is 20/20, but knowing what we know now, we would have launched Lunch:On Pro earlier. That’s our subscription service that enables users to get their lunch daily for AED25. This has really been a game-changer for us, one that has enabled us to democratise lunch, and make fantastic daily lunch options affordable to significantly more people.For all the latest business news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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