Noha Gad

The rapid growth of e-commerce urged retailers to deliver faster, cheaper, and more reliable services to meet customers’ preferences for same-day or even two-hour deliveries. Traditional fulfillment models, relying on large regional warehouses, often struggle to meet urban delivery expectations due to long transit times and high last-mile costs, which can account for up to 53% of total shipping expenses.  

This shift has driven the adoption of localized fulfillment strategies, with Micro-fulfillment centers (MFCs) emerging as a scalable solution to bridge the gap between supply and demand in high-density markets.

MFCs integrate directly with e-commerce platforms, allowing real-time inventory synchronization and seamless order processing. They play a pivotal role in optimizing e-commerce operations by enabling proximity-based fulfillment. By storing high-turnover inventory in urban micro-hubs, retailers can drastically reduce delivery times, often to less than 24 hours, while improving order accuracy through automation.

These compact, automated centers, typically ranging from 3,000 to 10,000 square feet, revolutionize modern logistics as they bring inventory closer to urban consumers and enable faster deliveries and more efficient supply chains. MFCs were developed to meet rising consumer demand for same-day or next-day delivery, utilizing automation and real-time inventory systems to process orders with speed and precision, making them a cornerstone of agile e-commerce fulfillment.

How MFCs work

The primary objective of an MFC is to optimize last-mile delivery, the most expensive and time-sensitive segment of the supply chain, by reducing the distance between inventory and end customers. 

Micro-fulfillment centers integrate three essential components: advanced management software, automated physical infrastructure, and streamlined packing operations. The software layer processes incoming online orders in real time, synchronizing with e-commerce platforms and inventory systems to ensure accuracy and speed. Meanwhile, the physical infrastructure leverages robotics, automated storage and retrieval systems (AS/RS), and conveyor networks to retrieve items with minimal human intervention, significantly reducing labor costs and error rates. Once ready, items are transferred to packing stations where staff or automated systems prepare them for dispatch, often within hours of order placement.

These centers can operate as standalone facilities or be embedded within existing retail stores, enabling omnichannel fulfillment strategies such as ship-from-store, buy-online-pickup-in-store (BOPIS), and curbside pickup.

Types of micro-fulfillment centers 

There are three primary types of MFCs: standalone, store-integrated, and dark stores. Standalone MFCs are independent, compact logistics facilities typically ranging from 3,000 to 10,000 square feet. These centers focus exclusively on processing online orders for rapid last-mile delivery. They are often built in repurposed industrial spaces, basements, or standalone urban lots and can be deployed within months due to minimal construction requirements. They are effective for e-commerce businesses seeking to scale delivery speed without relying on existing retail footprints.

Store-integrated micro-fulfillment centers are embedded within active retail or grocery stores, typically in backrooms, basements, or underutilized floor space, allowing simultaneous in-store shopping and online order fulfillment. This type leverages the store’s proximity to customers to reduce shipping costs and accelerate delivery times, often enabling curbside pickup, BOPIS, and local delivery within hours. This model also improves inventory turnover by dynamically allocating stock between in-store sales and online fulfillment, reducing overstock and shrinkage.

Additionally, dark stores are retail locations that have been converted into fully automated, customer-inaccessible fulfillment centers dedicated exclusively to processing online orders. Unlike store-integrated MFCs, dark stores do not serve walk-in customers; they serve fulfillment staff or robots that pick items from shelves and pack them for home delivery or pickup. 

Dark stores are particularly prevalent in grocery and fast-moving consumer goods (FMCG) sectors, where demand for rapid delivery is high.

How MFCs boost the e-commerce industry

Retailers of all sizes leverage micro-fulfillment centers to stay competitive as they offer a wide range of benefits, including: 

-Faster delivery times.

-Improved customer satisfaction.

-Lower delivery and inventory costs.

-Space optimization.

-Omnichannel integration.

The future of MFCs is shaped by rapid urbanization and the growing need for hyper-local fulfilment solutions, fueled by advancements in robotics, AI-driven inventory management, and automation technologies. Thus, these centers are no longer a futuristic concept but a strategic necessity in the evolving landscape of e-commerce and urban logistics. 

MFCs offer a scalable, efficient solution to meet consumers’ demand for same-day and even same-hour delivery by bringing inventory closer to end customers through compact, automated hubs located in or near cities.

Finally, MFCs represent a transformative shift in how goods are stored, picked, and delivered. As technology advances and urban density increases, MFCs will become an operational imperative for businesses aiming to meet rising customer expectations for speed, convenience, and sustainability in the digital age.

Noha Gad 

The food and beverage (F&B) sector represents a key pillar in Saudi Arabia’s journey towards economic diversification and sustainable growth. This promising industry has witnessed a significant expansion with technology being a catalyst for seismic changes in the sector amid shifting market dynamics and evolving consumer demands.

A recent report by AstroLabs, the leading business expansion platform in MENA, revealed that the market value of the Saudi F&B industry reached $45 billion in 2024, presenting lucrative business opportunities across its segments and subsegments. The same report anticipated consumer spending on food services to rise by 6% annually over the next five years, while the food delivery market is projected to surge to $14.9 billion by 2028.

Technology has profoundly transformed every stage of the food value chain, from using advanced agricultural technologies that enhance farming and enable controlled environment agriculture, to shaping how food is accessed, prepared, and enjoyed. Integrating IoT and blockchain also enhanced supply chain transparency, food safety, and traceability, building greater consumer trust and reducing inefficiencies throughout the sector.

This synergy between tradition and modernity not only preserves Saudi Arabia’s culinary heritage but also ensures that technology remains at the heart of future growth, delivering resilient, sustainable, and world-class food systems for generations to come.

Another report by the global business consulting firm, Grand View Research, unveiled that the food technology (foodtech) market in Saudi Arabia is expected to reach $10.2 million by 2030, marking a compound annual growth rate (CAGR) of 10.5%.

Additionally, the latest report by the Saudi Central Bank (SAMA) highlighted that the point-of-sale (PoS) sales in the F&B sector surpassed SAR 165.7 billion during the second quarter (Q2) of 2025, backed by a humble increase in the number of transactions, which reached over 2.7 billion.

Critical things to consider for establishing a strong presence in the Saudi F&B sector

• Testing the market first and prioritizing omnichannel retail. Companies that aspire to expand into Saudi Arabia must test their products in the market before making large investments. Also, omnichannel retail involving online and offline sales has become an important mainstay in the Saudi retail sector, while the growth of younger consumers has resulted in a shift from traditional trade to modern trade. 
• Obtaining Halal certifications and forging partnerships with local players. Halal certification is necessary for food brands to gain a foothold in this market. They need to ensure compliance with Saudi Food and Drug Authority (SFDA) regulations.
• Utilizing logistics and temperature-controlled delivery hubs to ensure products remain fresh.

The Saudi foodtech landscape is bustling with innovations and investment, with several startups leading the charge, notably Nana, the dark store grocery delivery startup and a key player in the digital shopping solutions sector; Foodics, the leading cloud-based technology and payments platform for restaurants; iyris, the innovative agriclimate tech company specializing in advancing commercial farming; Mr. Mandoob, a state-of-the-art delivery platform that connects consumers with various dark stores, and more. 

Key innovations that transform the F&B sector in Saudi Arabia 

Cloud Kitchens 

The cloud kitchen business is transforming the food service industry in Saudi Arabia, providing a unique blend of convenience and innovation to meet the evolving demands of consumers. Cloud kitchens, or virtual kitchens, operate exclusively for delivery orders without dine-in options, offering a cost-effective alternative to traditional restaurants. This model allows food entrepreneurs and established restaurant chains to launch multiple brands from a single kitchen space.

The boom in the cloud kitchen industry was driven by high demand for delivery services, notably during the COVID-19 pandemic, lower operational costs, flexible operations, and the emergence of e-commerce and delivery platforms, such as Jahez, HungerStation, and Talabat.

According to a survey conducted by Qoot, a subsidiary of management consulting firm Mukatafa, 44% of respondents believe that cloud kitchen businesses have lower operational costs than a normal restaurant. However, 56% said they saw fewer sales than a normal restaurant business, with only 17% reporting more sales.

The cloud kitchen market in Saudi Arabia is expected to hit $335.7 million by 2030, growing at a CAGR of 7.7% from 2021 to 2030, as stated by Al Taasis, a leading business incorporation and on-the-ground corporate solutions specialist.

Over the next five years, Saudi Arabia is anticipated to become one of the leading markets for cloud kitchens in the region, backed by urbanization, government support for entrepreneurship, and a growing appetite for digital services.

Establishing a cloud kitchen business offers various advantages, including the flexibility in menu changes, reduced financial burden, operational efficiency, and direct access to customer insights.

Subscription Meal Services

The subscription meal services industry in Saudi Arabia is gaining momentum as consumers increasingly seek convenient, healthy, and personalized dining options. This service offers customers the ability to subscribe to meal plans that deliver ready-to-eat or easy-to-prepare meals regularly, catering to varying dietary needs and preferences. 

The rising awareness of nutrition and wellness, urban lifestyles that limit time for cooking, and the integration of digital platforms that enhance user experience have accelerated the growth of subscription meal services in the Kingdom.

The ‘KSA Subscription-based Meals Market Research’ report, published by MarkNtel, stated that the subscription-based meals market in Saudi Arabia reached $254 million in 2024, and is expected to hit $383.5 million by 2030, with a CAGR of around 7.11% during 2025-2030.

Figures released by the global data and business intelligence platform, Statista, revealed that revenue in the Saudi meal delivery market is projected to surpass $10 billion in 2025 to reach $11.7 billion by 2030.

Calo is one of the key players that revolutionizes personalized meal subscriptions in Saudi Arabia. In 2024, it delivered 10 million meals across the GCC, reinforcing growing demand for data-driven, personalized nutrition.  

Other Saudi subscription meals platforms, such as Freshhouse, Right Bite, and Dailymealz, allow users to update their meal plans, pause or skip deliveries, and provide feedback, creating a highly user-centric experience. They provide consumers flexibility in meal selections, customizable menus, and streamlined delivery schedules, making it easier for them to maintain consistent healthy eating habits.  

AI-Powered Food Applications

Technology is a game-changer in the online food delivery market in Saudi Arabia. Platforms invest heavily in new tools that make things easier for users and run their operations better. They also utilize artificial intelligence (AI) and data to tailor their services, predict consumer preferences, and find the best routes for delivery. A recent report published by IMARC Group stated that the online food delivery market in Saudi Arabia is expected to record $5.71 billion by 2033, marking a CAGR of 13.6 during 2025-2033.

The AI-powered food applications in Saudi Arabia operate within a rapidly growing multi-billion-dollar online food delivery market, backed by high-tech infrastructure, a high internet penetration rate (99%), a large base of digital consumers, and heavy use of AI for personalization, logistics, and operational efficiency

Finally, the emergence of a digital food landscape has created opportunities for new delivery systems. The ongoing digitization of the food delivery space reflects a dynamic scene with potential shifts and increased business activities, contributing to the development of the Saudi tech sector and the realization of Vision 2030’s objective of localizing 85% of its food industry by 2030. 

Noha Gad

The substantial growth in the e-commerce sector over the past few years has revolutionized the retail landscape, powered by a surge in global online shoppers and evolving consumer expectations. In 2025, the number of online shoppers across the world is expected to reach around 2.77 billion, representing almost one-third of the global population, according to recent data released by SellersCommerce, a leading global B2B platform transforming the e-commerce landscape. 

This rapid expansion is triggered by increasing internet penetration, mobile commerce adoption, and the convenience offered by digital platforms. Consumers now demand faster, more flexible, and reliable delivery options, raising the bar for companies to optimize their last-mile delivery processes.

The term ‘last-mile delivery’ refers to the final stage in the supply chain where goods travel from a warehouse or local distribution center to the end customer’s doorstep, business, or a parcel locker. Although last-mile delivery is the shortest leg of a product’s journey, it is the most complex and expensive part of the logistics process, accounting for over half of total shipping costs. This phase directly links brands to consumers, serving as the ultimate touchpoint in fulfilling customer orders.

The rise in e-commerce and on-demand services highlighted the importance of last-mile delivery in meeting customers’ expectations to receive their packages safely with remarkable speed and flexibility. Same-day and next-day delivery options have become standard expectations, pushing businesses to innovate and optimize this phase of logistics. Thus, last-mile delivery is no longer just about moving parcels but about delivering superior customer experience and satisfaction.

Last-mile delivery requires careful route optimization, multiple stops, and flexible scheduling to meet strict delivery deadlines, especially in crowded urban environments. With growing expectations for transparency, customers now demand real-time tracking and prompt notifications, adding pressure on carriers and logistics providers. Successfully navigating these operational complexities can set companies apart in a competitive landscape and build lasting customer loyalty.

The evolution in last-mile delivery

The last-mile delivery landscape saw a remarkable evolution, driven by the shift from simple, manual processes to highly sophisticated, technology-driven operations. In the past, deliveries were largely managed through routine routes and fixed schedules, but today, last-mile delivery has transformed into a dynamic, customer-focused process that leverages data analytics, automation, and smart logistics solutions to optimize every step of the journey.

Emerging technologies played a pivotal role in enabling this shift. Real-time tracking systems, route optimization software, and mobile applications empowered delivery teams with the tools to plan more efficient routes, reduce fuel consumption, and proactively communicate with customers. Additionally, data analytics provides crucial insights into delivery patterns, resource allocation, and customer preferences, allowing companies to enhance their operations for maximum efficiency. 

These technological developments raised customers' expectations for last-mile delivery as shoppers prioritize speed and convenience, with same-day and even one-hour deliveries becoming standard in many markets. 

Outsourcing last-mile delivery became a strategic priority for many businesses aiming to meet the rising demands of today’s fast-paced and competitive market. By outsourcing last-mile delivery, companies mainly rely on specialized third-party logistics (3PL) providers to handle the critical final stage of the supply chain, instead of managing their own fleets and delivery personnel.

This shift enables businesses to scale operations efficiently without incurring the heavy costs of fleet ownership and management. It also enhances customer experience by providing more localized and flexible delivery options.

Key innovations in last-mile delivery

• Electric and autonomous delivery vehicles. This innovation is ideal in urban locations with frequent stops and short distances. It contributes to reducing carbon emissions, noise pollution, and operational costs. Leveraging AI, GPS, and sensors, autonomous delivery vehicles can navigate complex environments and operate 24/7. Despite these promising benefits, challenges remain in regulatory approval, cybersecurity, and infrastructure adaptation.
• Drone Delivery. This solution rapidly emerged as a transformative power in last-mile logistics as it offers unparalleled speed and flexibility in reaching customers, especially in congested urban centers and remote areas. This ability makes drones ideal for urgent deliveries such as medical supplies, food, and small parcels, where speed is critical. Electric-powered drones produce zero emissions and reduce road congestion, enabling direct deliveries to homes or designated drone ports, supporting sustainable urban logistics. One of the key challenges that delivery drones face is payload and flight range limitations that restrict package size and delivery distance.

Overall, last-mile delivery acts as a critical bridge in the logistics chain, connecting the complex global supply network to individual consumer experiences. Its evolving role requires continuous innovation to meet customer expectations for fast, reliable, and sustainable delivery. Mastering last-mile delivery is not just about moving parcels faster; it’s about crafting exceptional delivery experiences that build trust, loyalty, and a greener future in an ever-connected digital marketplace.

Kholoud Hussein 

In today’s fast-evolving business world, especially within the high-growth startup ecosystem, the traditional employer-employee dynamic is undergoing a fundamental shift. One of the most powerful tools fueling this change is the Employee Stock Ownership Plan (ESOP)—a compensation mechanism that offers employees an equity stake in the company. Once considered a niche concept in corporate America, ESOPs have become a strategic cornerstone in startups across the globe, including emerging ecosystems in the Middle East, North Africa, and beyond.

What Is an ESOP?

An Employee Stock Ownership Plan (ESOP) is a program that allows employees to become partial owners of the company they work for. Instead of solely receiving salaries or bonuses, employees are granted shares (or options to buy shares) in the company, either directly or through a trust. These shares typically vest over a period of time, incentivizing long-term commitment and alignment with the company’s goals.

In simpler terms, ESOPs give employees "skin in the game." When the company does well, so do they. If the company is acquired or goes public, employees with vested stock can realize substantial financial gains.

Why Startups Embrace ESOPs

Startups, especially in their early stages, often face budget constraints. Offering high salaries to attract top talent isn't always feasible. That’s where ESOPs come in—not only as a financial workaround but as a strategic asset.

1. Talent Attraction and Retention:
   In highly competitive markets, top-tier talent is drawn to startups that offer equity. The promise of future ownership, particularly in a fast-scaling company, can be more appealing than a higher salary at a traditional firm.
2. Motivation and Performance:
   When employees are co-owners, they’re more likely to think and act like entrepreneurs themselves. This fosters a culture of accountability, innovation, and performance-driven decision-making.
3. Cash Preservation:
   By offering equity instead of higher cash compensation, startups can allocate resources to product development, marketing, or scaling—vital for survival and growth in early stages.
4. Alignment of Interests:
   ESOPs naturally align employee interests with those of the founders and investors. Everyone becomes invested in the company's success, leading to better collaboration and long-term thinking.

How ESOPs Work in Startups

Typically, startups set aside a percentage of their equity—often 10% to 20%—in an "ESOP pool." This pool is then distributed among current and future employees based on role, seniority, and performance.

Shares are not handed out all at once. Instead, they vest over time, commonly on a 4-year schedule with a 1-year cliff. That means employees earn their shares gradually, encouraging them to stay and contribute over the long haul.

In high-growth startups, especially those targeting IPOs or acquisitions, vested ESOPs can become extremely valuable. Employees may cash out during an exit event or through secondary share sales, transforming equity into life-changing rewards.

ESOPs in Emerging Markets

In the MENA region, the concept of ESOPs is gaining ground as local startups mature and global investment interest rises. Governments and regulators in Saudi Arabia, the UAE, and Egypt are beginning to recognize the value of employee ownership as a means of encouraging entrepreneurship and economic diversification.

However, challenges remain, such as legal frameworks, tax implications, and cultural acceptance. Many employees remain unfamiliar with the concept of equity compensation, and some startup founders are hesitant to dilute their ownership stake. Education and transparency are crucial in bridging this gap and fully unlocking the potential of ESOPs in regional markets.

To conclude, for startups, ESOPs are not just a tool to attract employees—they are a strategic enabler of growth, culture, and resilience. They align incentives, foster loyalty, and build a sense of shared mission. In a world where innovation moves fast and people drive performance, ownership can be a game-changer.

As startup ecosystems continue to expand globally, integrating ESOPs into compensation strategies will not only help attract top talent but will also redefine how success is shared and who gets to own the future.

Ghada Ismail

When you're in the initial stages of launching a startup—raising money, acquiring users, building product-market fit—thinking about an exit seems too early. But experienced founders know that from the very start, you build not just for expansion, but for a potential finish line.

An exit strategy is your strategy for how you and your investors will ultimately cash out of the business. It determines how stakeholders will harvest the value they've helped create, either by selling the firm, merging with another company, going public, or even closing down.

Let's break down what an exit strategy is, why it's important, and what alternatives startups usually consider.

Why Startups Require Exit Strategies

An exit strategy is not quitting; it's preparing for the transition that is needed. No business is ever a startup forever. Whether your company succeeds, pivots, or tanks, every business trajectory will eventually reach a fork in the road.

what comes next is why it is so essential to have an exit strategy:

•Investor Expectations: Venture capitalists invest with an expectation of return, usually through exits like acquisitions or IPOs.

• Strategic Planning: Having a potential endpoint in mind informs your business decisions along the way.

• Founder Goals: Some founders envision a legacy company, whereas others plan for exit after 5-7 years. Both are doable but necessitate different strategies.

• Risk Management: Exit planning prepares for market downturns or challenges internally before they get out of hand.

Common Types of Startup Exit Strategies

1. Acquisition

An acquisition happens when a larger company buys your startup, either for your product, your team, or your users, or all three.

An acquisition provides liquidity and can be quicker than an IPO. Ex: Facebook buying Instagram.

It is best for startups with differentiated tech, strong growth, or strategic value to larger players.

2. Initial Public Offering (IPO)

Going public via an exchange listing is considered the "final" exit. It has the added benefits of raising funds, increasing visibility, and providing liquidity for investors.

IPOs are rare because they are expensive, heavily regulated, and suitable only for established startups with strong financials.

IPOs are best for high-growth startups in large markets, especially ones with global ambitions.

3. Merger

A merger combines your startup with a different company, typically to share resources, grow faster, or be able to compete more effectively.

It may allow startups to exist in challenging markets or expand better. It works best for startups that desire to benefit from a different firm's capabilities.

4. Management Buyout (MBO)

In an MBO, your firm is purchased by internal parties, generally high-level employees or current executives.

It keeps the company's culture intact and compensates the core team from within.

MBOs are ideal for startups with devoted leadership teams and no external investors anticipating enormous returns.

5. Shutting Down 

Not all exits are glamorous. Sometimes the wisest thing to do is an orderly shut-down; returning outstanding capital, paying off obligations, and closing neatly.

Why it's important: Dying startups can also exit in style, preserving founder reputations and investor relationships.

They work best for startups that can't scale or pivot successfully.

How to Select the Best Exit Strategy?

There is no one-size-fits-all path. The ideal exit strategy will depend on your intentions, your investors' timelines, your market, and your business model.

Below are some questions to guide you:

• Are you creating to sell or to remain?

• What degree of control do you desire over your company long-term?

• How long do you want to remain involved after exit?

• Are your investors requiring a timeline or a specific type of return?

Talking about it upfront—both internally and to investors—can get everyone aligned and eliminate conflict down the road.

When Should You Start Thinking About Exits?

Ideally, before you raise your first Riyal. Exit planning should be on your to-do list from the day you start raising capital or even conceiving your growth strategy.

Even though you don't have an established deadline or guaranteed result, having a direction where you're heading keeps decisions regarding hiring, product development, and investor relations aligned.

The earlier you begin contemplating your exit, the more on your terms you'll be in control of it.

Wrapping things up…

An exit strategy does not mean you're going to exit, but planning in advance. If your desire is to be acquired, merge with a strategic business partner, or develop a sustainable business that can continue without you, knowing how your journey may shift impacts how you build today.

Startups are volatile. But having clarity around your long-term vision gives you and your stakeholders the direction you need to make better decisions, grow on purpose, and exit on your terms.

Noha Gad

The startup world is witnessing a quiet revolution. While venture capital and bootstrapping dominate headlines, a lesser-known model, search funds, has been delivering outsized results for founders and investors alike. 

Unlike traditional venture capital, search funds empower founders to acquire and scale existing companies with investor-backed capital and mentorship, significantly de-risking the entrepreneurial journey. But why are search funds gaining traction, and how can they transform your startup’s future? 

What are search funds?

Search funds are an innovative investment model where aspiring entrepreneurs (called "searchers") raise capital from investors to systematically acquire and operate an existing small-to-midsize business. 

The process comprises two phases: first, the searcher raises an initial "search fund" (typically ranging between $500,000 to $1 million) to cover 12–24 months of operational costs while identifying and evaluating potential acquisition targets. They analyze hundreds of businesses, leveraging investor networks and industry expertise to find undervalued companies with strong growth potential.

Once a searcher identifies and acquires a target business, the operational transformation phase begins. In this phase, the searcher steps in as CEO, using additional investor capital and mentorship to scale the business.

This stage plays a critical role in de-risking entrepreneurship as it helps searchers avoid the 90% failure rate of early-stage startups by building on a proven foundation. Additionally, it increases the investor's return on investment (ROI) by 4.5 times.

Why do search funds matter?

Unlike traditional venture capital, search funds focus on proven businesses, offering a unique blend of entrepreneurial opportunity and reduced risk. Investors, often high-net-worth individuals or institutional players, provide not just capital but hands-on guidance, forming a partnership with the searcher. 

This symbiotic approach has made search funds particularly attractive for founders seeking a "middle path", avoiding the grind of starting from scratch while sidestepping the equity dilution common in VC-backed startups.

Why are search funds critical for startups?

Search funds offer various benefits for startups, such as:

• Access to capital without extreme dilution. Search funds enable searchers to raise acquisition capital without giving up ownership upfront.
• Built-in traction and market validation. Search funds target already revenue-generating companies with existing customers, eliminating guesswork.
• Accelerated growth with expert backing. Unlike passive VC investors, search fund backers often provide industry-specific mentorship.
• Risk mitigation in volatile markets. Search funds usually target recession-proof sectors, such as B2B services, healthcare, and IT.

How to leverage search funds?

Search funds provide a unique opportunity for ambitious operators to acquire and scale established businesses while mitigating startup risks. Entrepreneurs should focus on securing investors with industry expertise, targeting stable companies in recession-resistant sectors, and executing post-acquisition growth through operational improvements and strategic add-ons. 

On the other hand, investors must focus on sector expertise and aligning incentives to capitalize on search funds’ unique advantages: lower risk than traditional VC, higher involvement than PE, and typical returns upon exit.

Finally, search funds represent a transformative model that provides entrepreneurs a proven path to leadership without the volatility of starting from scratch. Meanwhile, these funds offer investors a hands-on, high-reward asset class grounded in real businesses. By merging operational expertise with strategic capital, this model transforms undervalued companies into growth engines while producing exceptional returns. 

Noha Gad

The world’s population is expected to surpass 10 billion by 2050, creating an urgent need to increase food production by nearly 70% to meet growing demands. However, this challenge is compounded by shrinking arable land, limited water resources, and the unpredictable effects of climate change.

Traditional farming methods are no longer sufficient to address these challenges sustainably. This is where artificial intelligence (AI) steps in as a game-changer. By leveraging advanced technologies like machine learning, predictive analytics, and automation, AI has the potential to revolutionize agriculture, helping farmers produce more with fewer resources, reduce waste, and adapt to changing environmental conditions. 

Technology, particularly advanced tools like AI, IoT devices, and precision farming techniques, offers powerful solutions to these challenges. These tools provide smarter resource management, real-time monitoring, and predictive decision-making, empowering farmers to increase efficiency and create a more sustainable agricultural system. 

What is agricultural technology?

Agricultural technology (agritech) is the use of innovative tools, systems, and methodologies that apply cutting-edge technologies to enhance the efficiency, productivity, and sustainability of farming practices. 

It plays a transformative role in revolutionizing the sector by enabling smarter, data-driven decisions. Through tools like precision farming, farmers can analyze soil health, optimize irrigation, and apply fertilizers more accurately, leading to reduced waste and increased yields.

Additionally, IoT sensors and drones provide real-time insights into crop health, allowing early detection of pests or diseases and timely interventions. Meanwhile, automation, such as robotic harvesters and self-driving tractors, helps to address labor shortages while improving operational efficiency.

Agritech can also redefine the supply chain, ensuring traceability and reducing food waste through technologies like blockchain and predictive analytics. These innovations not only make farming more productive and sustainable but also help meet the global demand for food in an environmentally responsible way.

The role of AI in revolutionizing agritech

AI's ability to analyze vast amounts of data and deliver actionable insights can revolutionize the agritech sector, introducing smarter, more efficient, and sustainable solutions to traditional farming challenges. By leveraging machine learning, computer vision, robotics, and big data analytics, AI can transform every aspect of agriculture through:

• Precision farming: AI-powered systems analyze data from sensors, drones, and satellites to optimize irrigation, fertilization, and pest control.
• Crop monitoring and disease detection: Computer vision and machine learning models process real-time imagery from drones or cameras to identify early signs of disease, pest infestations, or nutrient deficiencies.
• Autonomous machinery: AI-based self-driving tractors, robotic harvesters, and automated irrigation systems can reduce labor dependency and increase efficiency.
• Supply chain optimization: AI helps streamline the agricultural supply chain by predicting demand, minimizing food waste, and ensuring traceability.
• Predictive analytics: AI analyzes historical and real-time data on weather patterns, soil health, and market trends to forecast yields, predict pest outbreaks, and plan planting schedules. This helps farmers mitigate risks and make informed decisions.

Additionally, AI models can stimulate the effects of climate change on crops, helping farmers adapt by choosing the right seeds, planting strategies, and technologies to sustain production in extreme conditions.

Challenges and Concerns 

Despite the immense potential of AI in agriculture, its adoption comes with significant challenges and concerns that cannot be overlooked. From issues of affordability and accessibility to ethical dilemmas and data security risks, these hurdles highlight the complexities of integrating technology into traditional farming systems.

Finally, the integration of AI into agriculture is not just a technological shift, it is a revolution that holds the potential to address some of the most pressing challenges of our time. From enhancing productivity and sustainability to enabling climate-resilient farming, AI is transforming how food is grown, harvested, and delivered to consumers. As we look to the future, the promise of AI in agriculture lies in its ability to balance the demands of feeding a growing population with the urgent need to protect our planet.

Noha Gad

The agricultural technology (agritech) market in Saudi Arabia is experiencing significant growth as the Kingdom invests heavily in modernizing the agricultural sector through cutting-edge technologies, in alignment with Vision 2030 goals of diversifying the national economy and ensuring food security. 

The agritech startup ecosystem in Saudi Arabia is rapidly evolving, backed by government support, private investments, and innovative entrepreneurs. Additionally, the focus on sustainable and efficient agricultural practices aligns with global trends, positioning the Kingdom as a potential leader in agritech developments in the Middle East and beyond.

In this regard, Sharikat Mubasher had an interview with John Keppler, Executive Chairman of iyris, one of the leading agritech startups in Saudi Arabia specializing in advancing commercial farming for low to mid-tech farmers in hot climates globally.

First, can you share more details about iyris' solutions to advance commercial farming in warmer climates? 

iyris is a pioneering Saudi-founded Agritech company. We specialize in solutions which enable sustainable commercial farming in hot climates. 

Our founders designed solutions to make it easier for farmers to grow fresh crops in difficult environments. Derya Baran, Mark Tester, and Ryan Lefers each had an academic and commercial focus on mitigating the impact of climate change to help feed the world’s growing population sustainably.

In our lead product, SecondSky, we created a range of greenhouse coverings that minimize the stress and impact of near-infrared heat radiation on plants while allowing the spectrum of light that plants need for photosynthesis. This is revolutionary in the agriculture industry. It delivers more resilient, productive, and profitable crops in regions where climate change and excessive heat make it difficult to grow fresh produce sustainably.

SecondSky’s polycarbonate, polyethylene, nets, and soon-to-be-launched shade screens are deployed to customers growing fresh produce in the UAE, Saudi Arabia, Egypt, Morocco, Spain, Portugal, Mexico, and North Africa. 

While the nanomaterials we invented to make these benefits possible are proprietary and complex, our business model is designed to deliver this innovation as simple as possible by making it a drop-in solution to existing manufacturing and distribution channels.  That way, our customers can buy their roofs, nets, and screens using SecondSky as a one-for-one replacement for traditional plastic greenhouse roofing. 

Utilized by growers on five continents and in 11 countries, SecondSky alone delivers a reduction in energy use by over 40% and water consumption of 30% at customer installations and we have seen crop yield increases and growing season extensions by as much as 35%.

Additionally, iyris has developed plant genetics via a novel hybridization process that has the potential to breed resiliency to salinity, head, and drought processes across a broad range of crops, ensuring stress-resistant, dependable food production. The technology is already demonstrating exciting results with some of the world’s largest tomato growers in large-scale open-field trials.

How could iyris’ climate-smart solutions enhance agricultural sustainability in Saudi Arabia?

iyris’ climate-smart solutions play a pivotal role in enhancing agricultural sustainability in Saudi Arabia and beyond. Invented at KAUST in Saudi Arabia, our technologies have been trialed and tested to withstand the Saudi Arabian climate. The academic and scientific resources at KAUST and funding and incubation provided by the university and its seed and venture funding capabilities have been a critical part of our journey in developing products in Saudi, by Saudi, and for Saudi, and then exporting to the world. 

It works well in the region because it was developed for the challenges of the region, which given the implications of climate change are having a negative impact globally.   

iyris’ SecondSky technology blocks heat radiation effectively, making it ideal for addressing the challenges of the extreme Arabian Gulf conditions and helping to increase food security in a country where 85% of its food is imported. In targeting low to mid-tech farmers, who represent more than 70% of growers worldwide, we provide an immediately deployable solution that impacts growers from the moment it is installed. 

In the Saudi Arabian context, that means that farms that were unproductive can be brought back into the supply chain very quickly. For each kilo of produce that is grown locally, that is a kilo less that needs to be imported, or transported across the Kingdom. Every farmer who can grow both in a financially and ecologically sustainable way protects the future of their local communities and has the potential to reduce urban drift. 

We have already executed pilot projects within the Kingdom where these benefits are starting to be seen and it’s a program that we think can be widely expanded.

Pure Harvest Smart Farms concluded a deal to acquire iyris’ facility in the Kingdom. In your opinion, how could this step help iyris to broaden its presence in Saudi Arabia?

The sale of our facility in Saudi Arabia to Pure Harvest Smart Farms reflected our strategic transition into a pure-play technology company. Known for its commitment to sustainable and climate-smart farming, Pure Harvest was an ideal partner to take on this facility.

The integration of our SecondSky heat-blocking technology at the facility aligns with Pure Harvest's dedication to sustainable agriculture and solidifies our technology as a valuable asset in Saudi Arabia's agricultural landscape. 

This sale solidifies existing partnerships (e.g. Alajaweed Farm), presents opportunities for collaboration, and fosters the growth of innovative agricultural solutions in the region. The move has advanced sustainable agriculture and addressed climate-related challenges in Saudi Arabia, strengthening our presence in the Kingdom.

What about your recent $16 million Series A funding round? 

In May 2024, we raised a $16 million Series A round. We are proud of this vote of confidence from the investment community, which comprised existing and new investors.

The fundraising was led by Ecosystem Integrity Fund (“EIF”), a San Francisco-based climate and sustainability fund supporting high-growth companies that drive a positive environmental impact, with further support from Global Ventures, Kanoo Ventures, Dubai Future District Fund (DFDF) and Bonaventure Capital. 

The proceeds will help support increased sales coverage and delivery of iyris’ strong international sales pipeline for our SecondSky greenhouse covers and nets. It will also fund the continued development of our innovative heat-blocking products and resilient plant genetics, which both have huge potential to improve yields further. 

We are grateful for the investors who have recognized that iyris technology solutions deliver tangible benefits to the farming community and understand its wider potential. Our investors understand there is a clear and focused strategy for delivering scalable AgriClimate technologies into our addressable market. 

What are iyris’ plans to expand beyond the Saudi market, notably in Egypt and East Africa? And how do you see the future of sustainable farming and agriculture in Africa?

We are actively expanding our footprint in North and East Africa, delivering adaptable and effective solutions to commercial farming. In March 2024, we signed a strategic MoU with Magrabi Agriculture, Egypt’s leading fresh produce provider, enabling iyris’ cutting-edge technology to be deployed across Magrabi’s farming facilities and international operations.

This is one of several examples of successful partnerships and endorsement by key stakeholders in the region, as we continue to work closely to transform agriculture globally. 

In your opinion, how do iyris’ solutions contribute to tackling climate change?

With the global population estimated to grow to 10 billion by 2050, food security and farming in a sustainable manner (both environmentally and fiscally) is a worldwide challenge. By providing sustainable and efficient solutions that reduce water and energy consumption in farming practices by up to 90%, we contribute significantly to the collective effort to tackle climate change and promote a sustainable future.

We are proud to be helping feed the world in a climate-friendly manner.