An early investor in ride-hailing firm Careem is backing Kuwaiti e-commerce company Floward, which expects to post a profit next year as the pandemic accelerates a shift to online sales.
The company said its series B funding round raised $27.5 million and was led by STV, a Saudi technology venture capital fund that previously invested in Careem, which was acquired by Uber Technologies Inc. for $3.1 billion.
Floward, which delivers flowers and gifts online, plans to use proceeds mostly to expand in the region, after venturing into London earlier this year.
It may go public within the next two years and could decide on a listing venue later this year, founder and Chief Executive Officer AbdulAziz Al-Loughani said in an interview. London, New York and Saudi Arabia are possible venues for the IPO, he said.
Some of the biggest startup deals in the Middle East have come from Kuwait, an oil-rich Gulf emirate with a population of only about 4.7 million. These include takeovers of Kuwait-based food delivery services Talabat and Carriage.
Boutiqaat, a Kuwaiti online retailer of luxury goods and cosmetics, last year hired Citigroup Inc. to explore strategic options for the company, including a partial sale of the business and fund raising.
While the Middle East has been slower to adapt to e-commerce than other regions, lockdowns to combat the coronavirus pandemic last year have accelerated the shift to online shopping and food delivery.
Floward has seen a surge in e-commerce sales, which grew 10-fold last year compared to 2019. Revenue this year has already surpassed the whole of 2020, putting the firm on a “clear path” to profitability, Al-Loughani said.
The company currently operates in 20 cities across seven countries and aims to replicate its presence in the Gulf region on a more global scale. It will soon announce a nationwide service within the U.K. after launching in London, a city which alone represents a bigger market than the entire Gulf flower industry, estimated to be worth as much as $2.5 billion.
The firm is expanding into two more Arab countries this year and currently evaluating a move into Europe. “We’re thinking a lot more global and acting a lot more local,” Al-Loughani said.
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