Mobile grocery platform Nana Direct raises $6.6 million in Series A
Priya Wadhwa
What's the Deal

Mobile grocery platform Nana Direct raises $6.6 million in Series A

The market is growing amongst increasing competition.

Saudi-based e-grocery platform Nana Direct has raised USD 6.6 million in its Series A. The latest investment round was co-led by Middle East Venture Partners (MEVP) and Impact46, who were also joined by Watar Partners, Saudi Venture Capital (SVC) Company, and Wamda. This also marks the first investment from the partnership between MEVP and Impact46.

Nana Direct currently serves 13 cities in the Kingdom of Saudi Arabia through its mobile application, and is quickly gaining traction in line with the overall increasing interest from customers in the region for grocery delivery service.

The home-grown startup has built the necessary technologies required to work the system completely in-house, and has integrated with local stores and supermarkets to service its customers.

It delivers processed groceries, such as oil, milk, fruit juices, jams, cookies, and other shelf items, as well as fresh meat, fruit and vegetables produce — essentially the whole range of products one typically finds in a supermarket.

What the Nana team does very well, is offer a large selection of products, delivered seamlessly; and this is executed on the back of very robust tech.
Walid Mansour, Partner and Chief Investment Officer (CIO) at MEVP.

Nana Direct is currently in advanced stages of on-boarding new stores and supermarkets to offer greater availability to users. It will use the new capital to accelerate its growth plans, continue to build its team and further develop vendor relations.

Sami Alhelwah, Founder & CEO of Nana Direct, said in a statement, “Groceries form a significant fraction of a Saudi family’s monthly expenditure and I believed the experience they get in return could be enhanced manifold. All around MENA more and more offline retail verticals from electronics to food were moving online, and this is what led me to Nana, a supermarket in your mobile phone.”

For a culture that centres around food, groceries form a significant chunk of monthly expenses and people are on the lookout for new and interesting products. The convenience of grocery delivery and less time spent on the chore of purchasing is seeing the overall market in MENA expand. Nana Direct itself has seen a 3X increase in turnover in the past year, looking ahead towards a brighter future.

Sami added, “Our stores and supermarkets are the real champions. They shared the vision we had and have been so forthcoming throughout the integration cycle. It just goes to show that businesses, small and large, are welcoming technological innovation and that bodes well for all of us."

It just goes to show that businesses, small and large, are welcoming technological innovation and that bodes well for all of us
Sami Alhelwah, Founder & CEO of Nana Direct

Online grocery delivery services are growing in the region as people are looking for smarter ways to save time, get value deals, as well as fresh produce without spending time and effort to go to shops and look for products between tens of ailes. ZadFresh from Saudi, El Grocer from Dubai, and MAF’s Carrefour are all competing in the same space, which is still growing.

When it comes to Saudi’s Wadi, another grocery delivery platform, Majid Al Futtaim acquired the startup earlier this year; however, it has been reported that MAF has shut it down to consolidate its efforts on Carrefour’s own online delivery service.

Preference for online grocery shopping is divided between packaged goods and fresh produce.

We spoke to a few Dubai residents to ask whether they prefer ordering groceries online or going to the shop. The general consensus was that it depends on what they’re shopping for. For packaged or generic items that come from brands, they prefer shopping online as they were sure of what they would receive. However, most preferred buying fresh produce by going to the local shops and supermarkets themselves because they wanted to see and check before buying.

Nisreen Ali, one of the women interviewed, said she recently ordered a few items from Carrefour, including fresh oranges, cherry tomatoes, frozen strawberries, and cereal. She said that while the fresh fruits were good, exactly how she wanted them to be, frozen items and cereal was good too, the order for cherry tomatoes was incorrectly delivered.

While another Dubai resident who wished not to be named, said "The number one reason why I use a service like InstaShop is the convenience. After a long day of work, I do not want to spend 30-60 minutes going downstairs to do groceries, especially if it is just a few Dirhams to get it delivered. I'd much rather avoid the heat and save time than save a few Dirhams."

While packaged groceries are a strong market to enter through, fresh produce is slower to catch on as many people still want to ensure they are getting exactly the ripe fruit or fresh vegetables by picking it out themselves. Repeated excellent service in this arena has potential to change customer behaviour.