After having acquired online restaurant reserving and food delivery platform RoundMenu, ride hailing app Careem is now planning to invest over $150 million to launch food delivery business by September, the company confirmed in a statement to Forbes Middle East.
The Dubai-headquartered firm is in talks with investors to raise $150 million (AED551 million) to finance CareemFood that will be first launched in Pakistan this September, followed by the UAE, Saudi Arabia, other Gulf countries and Egypt.
Upon its launch, CareemFood will be entering an already crowded food delivery market in the Middle East, the value of which stood at $3.4 billion (AED12.9 billion), according to the annual food and beverage report by KPMG in 2017.
UberEATS, Talabat, Zomato and U.K.-headquartered Deliveroo all currently vie for a share of UAE’s lucrative food delivery market. Around 31% consumers in the U.A.E. use food apps to order food while 21% use them to find new restaurants, the KPMG study noted.
Thinning margins due to stiff competition have led the ride hailing firms in the region to diversify their revenue streams. In May 2017, Careem launched Box, a delivery service that allows users to have items like keys and documents delivered at a certain location. The service is similar to the ones offered by UAE -based Fetchr and Aramex.