Appetito Acquires Lamma to Open Office in Tunisia, Morocco, and West Africa

Appetito, an on-demand grocery retail company based in Cairo that delivers food to customers from a small network of dark stores, announced the acquisition of Lamma, a similar company based in Rabat and the Greater Tunis area of Morocco and Tunisia, on Tuesday.

The purchase is slated to finalize in the third quarter of 2022, according to a news release shared with TechCabal by Appetito co-founder Shehab Mokhtar, however the two firms have agreed to operate as one entity under Appetito. “It gives me great pleasure to welcome exceptional talent and like-minded entrepreneurs to our family.” “We’re a year ahead of schedule with our expansion plans in Africa,” Mokhtar said in a statement.

On a teleconference with TechCabal, Lamma co-founder and CEO Yassir El Ismaili El Idrissi said the two companies have already started training personnel together.

Techcrunch stated that the deal is worth between $10 million and $15 million, citing sources close to the situation. This raises questions about how Appetito funded it, given that it only disclosed a $2 million pre-series round and raised $2.5 million since it began operations in March 2020. However, Mokhtar told Techcrunch that his company is close to closing a $8 million investment to fund the expansion.

Lamma started out as a ridesharing service in 2020, but after attending the Flat6Labs Tunis accelerator program in June, the company moved its attention to the rapid commerce logistics market.

According to Crunchbase records, it also raised $72,500 from Flat6Labs Tunis and Orange Ventures in April and October of last year.

Since then, the company has started on an aggressive expansion campaign that has seen it expand into neighboring Morocco earlier this year and now join with Egypt’s Appetito.

Appetito said in April that it expected to add 50 dark establishments every year until 2024 as part of its aims to cover Cairo, Giza, and Alexandria, which TechCabal called “a test for multi-node last-mile distribution in Africa.” With the inclusion of Rabat and the Greater Tunis region, the new Appetito appears to already be overburdened.

El Idrissi, a co-founder of Lamma who will join Appetito to spearhead its growth and expansion, says the company would concentrate on solidifying its existing markets. “You can’t purchase long-term growth,” he told TechCabal, “therefore the main priority of our job is to ensure that our current operations, which are spread over three countries, are stable.” In Egypt, Morocco, and Tunisia, we have a lot of work to do.” He added that the company would only expand internationally when it was right.

Consolidating and growing locally makes sense. On the one hand, Appetito’s Egyptian competitors Breadfast and Rabbit (which also has a presence in Saudi Arabia) are vying for the same clients. Globally, quick-commerce grocery firms such as Getir, Gorillas, and GoPuff have struggled since the second quarter of the year, with layoffs announced by Getir, Gorillas, and GoPuff.