Abdulaziz Al Loughani is a Kuwaiti entrepreneur who had previously led Talabat before passing on the baton to his partner Mohammed Jaffar (who then sold the company to Rocket Internet for $170 million in 2015). He’s also a tech investor and has been investing in startups across the region through Faith Capital, an investment firm that he had co-founded with Mohammed Jaffar.
In 2017, Abdulaziz wore his founder hat again to start a company that would sell cut-flowers online. He had spotted a gap in the GCC cut-flower industry with over 98 percent of the $1.5 billion market being offline at the time.
Sharing the launch story, Abdualziz, CEO of Floward told MENAbytes, “The market was very fragmented back then with no regional leader and nascent online presence. After learning that there’s a clear gap in the industry, we invested in a small flower shop and then built the website and app ‘Floward’ (the name is a combination of Flower & Ward – Arabic for Flower), to sell flowers online.”
Instead of creating a marketplace which makes it easy to scale operations as you can onboard existing offline flower shops onto your platform wherever you want to launch and can have third-party logistics companies provide you last-mile delivery services, Abdulaziz and his team decided to go for a pure-play model, procuring flowers themselves and selling them on the website and app along with managing the last-mile delivery too.
Floward currently procures flowers from different parts around the world to have them couriered through airplanes to their facilities twice every week, shoot the arrangements, and push them on their website and app. In addition to its in-house designs, Floward also works with some renowned designers of the region to create different arrangements and partners with great regional/international brands to complement its product mix with chocolates, cakes, Arabic sweets, and perfumes.
When a customer places an order, Floward’s staff prepares the arrangement and delivers it on the same-day using its own last-mile delivery team. The startup says that it has an average order turnaround time of 1 to 4 hours depending on the city the customer is in.
Abdulaziz offered us an explanation of why they decided to go for a pure-play model, “It offered better unit economics with a higher lifetime value of customers and healthier margins. But more importantly, we wanted to do it to control the customer experience.”
The problem with the marketplace model in the flowers vertical, he explained, is that there are two customers that you’re serving; sender and recipient, and managing the expectations and experience of both these parties is not easy. “It is very common that customers would not receive what they see online when it comes to flowers, especially when the sender is different from the recipient. The best way to make sure that you’re delivering what your website states and shows, you will prepare and deliver it yourself.” said the CEO of Floward in a conversation with MENAbytes.
Following this model, Floward has also been able to offer a wider product mix variety that tackles different price points and offer better value for money across all markets they operate in, added Abdulaziz. He also stated that because they use their own last-mile delivery solutions in most cases, they’re able to offer a really fast turnaround time to customers.
Floward’s mobile app
In spite of following the pure-play model, Floward’s average decision-to-launch time for a new city is just two months, claimed Abdulaziz. “We have created a playbook that allows us to follow for every new city we launch in. The only major thing that we spend our time on is securing a sizeable area for their workshop and warehouse space – which is in close proximity to our customers, as well as hiring local talent.”
Floward now sells flowers and gifts in 9 cities across Kuwait, Bahrain, Qatar, Saudi Arabia, and United Arab Emirates and plans to launch in 6 more cities in the region before the end of the year.
The Kuwait-born startup has been able to grow its current annualized (net) revenue to over $30 million. It has raised close to $7 million to date including $2.75 million in a recent round that was led by Saudi’s Impact46. Faith Capital, the investment firm that Abdualziz co-founded, and BNK Capital also took part in this round and previous rounds along with other regional family offices & institutions.
Abdulaziz Alomran, the Founding Partner of Impact46, explaining why they decided to invest in Floward told MENAbytes, “This is a Khaliji dream-team. Floward ticks all the checkboxes we look for in a startup; a localized complementary team building a high growth venture in a globally proven market.”
Getting here has not been easy for the Kuwaiti startup. It has had its fair share of challenges as well – which ranged from validating the market size and growing at scale to building the capacity to manage growth and maintaining team harmony.
Abdulaziz’s previous experience with Talabat proved quite useful for his second online venture, “It helped me understand the exact skill-set we needed to achieve our goals. Leading Talabat also equipped me with deeper operational experience and faster execution capabilities. I knew the importance of unit economics from day one at Floward and that’s what we built the business around.”
The Talabat experience also made it easier for Floward to raise external capital. The investors obviously love to invest in repeat founders all around the world and the Middle East is no exception.
After its success in the Middle East, Floward is now setting its eyes on Europe. After expanding its services to six more regional cities by the end of the year, Floward wants to expand to some European markets, stated Abdulaziz in his conversation with MENAbytes, without sharing further details.
“We have built a strong regional brand with healthy unit economics. We like to think that our tech and product are more advanced than any other competitor in the region and even on a global scale. Some of our features are now being copied by some regional/international players. With a clear vision and a good understanding of the market, coupled with an expansion playbook and the right teams, we’re ready to take on Europe right now,” concluded Abdulaziz.
Zubair Naeem Paracha
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October 06, 2020 at 01:04PM
https://www.menabytes.com/floward-30-million-business/
Exclusive: How online flower platform Floward built a $30 million annual business in 3 years - MENAbytes
https://news.google.com/search?q=Flower&hl=en-US&gl=US&ceid=US:en
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