Dubai-based shared cloud kitchen startup, Kitopi is reportedly considering to raise between $150 million to $200 million in a new round of financing to expand its business to Southeast Asia.
According to people familiar with the matter, successful fundraising by the unlisted company could raise its valuation to about $1 billion. Kitopi has hired the Bank of America (BofA) for arranging the funding round.
Last year, Kitopi had to suspend its operations in the UK and the US as a result of the COVID-19 pandemic and shift its focus towards markets like the Middle East and Asia where business growth was possible.
Kitopi was active in the UK and the US markets for only a short period of time before the pandemic crisis and it is planning to re-enter these markets when the situation gets better, one of the sources said.
Kitopi, which is headquartered in Dubai, operates more than 60 kitchens and has over 1500 employees. It is planning to expand into Southeast Asia later this year.
Cloud kitchen facilities built to produce food specifically for delivery are gaining huge popularity among international investors and global food brands as movement restrictions encourage a boom in the food delivery market. Kitopi has raised $117.2 million since its inception from investors including Dubai-based venture capital firm BECO Capital and US-based Lumia Capital.
One of its smaller competitors iKcon was also in the market to raise funds last year, sources stated, as cloud kitchen startups grew their business during the pandemic that disrupted the dining industry.