Middle Eastern food delivery startup Calo said Tuesday it has raised $39 million in a Series B extension that was led by Aljazira Capital. The fundraise, which was more than 1.5x of its original $25 million raise in December, also saw participation from existing backers such as Nuwa Capital, STV, Khwarizmi Ventures, and Al Faisaliah Group.
The company is using this funding to expand into territories like the U.K. and to explore different partnerships in physical space.
Calo primarily offers ready-to-eat meals that customers can heat up later. The company delivers different plans to cater to various health goals. The company’s founder, Ahmed Al Rawi, told TechCrunch the startup’s revenue grew by “close to 100%.” Calo delivered more than 10 million meals last year in Saudi Arabia, the UAE, Kuwait, Qatar, and Bahrain. While Al Rawi didn’t provide a number for this year, he said the deliveries were growing in step with revenue.
Those numbers, along with its brand, technology, and operational excellence, convinced Aljazira Capital to invest in the Saudi company. “Calo represents a compelling opportunity at the intersection of healthtech, foodtech, and consumer subscription models,” Rawan AlRasheed, director of venture capital at Aljazira Capital, told TechCrunch in a statement.
The startup is also making moves to expand in the U.K., where last year it acquired two meal delivery services, Fresh Fitness Food and Detox Kitchen. While Fresh Fitness Food didn’t raise any money, Detox Kitchen had raised just over $3.4 million via a mix of venture-backed and equity crowdfunding rounds, according to Crunchbase data.
“We spoke to over 50 meal subscription businesses worldwide, ranging from the U.S. to Asia, in 2023-24 to learn about what is an exciting market for us to expand to. We realized the UK was the right market for us to expand. We thought that both companies that we acquired had a great culture fit to work with Calo,” Al Rawi told TechCrunch over a call.
He added that Calo acquired these businesses because they had their operational layer figured out, and the startup just wanted to upscale the tech and branding layer.
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Al Rawi said Calo spent most of this year integrating its technology and process with both U.K. platforms without laying off any of the existing personnel. The startup finished the integration work in July and has been slowly making a marketing push in the U.K.
Calo can currently deliver meals in London daily and in other parts of the U.K. two to three times a week. The founder said that Calo is targeting to get to 10x its revenue in the U.K. in the next three years.
Those U.K. ambitions will be met with competition. Apart from traditional food delivery giants like Just Eat and Deliveroo, Calo will also compete with meal-box services such as Gousto and Wicked Kitchen.
While Calo is focused on growing in the U.K., the company is also looking to acquire different meal-kit services around the world. The company is expanding physical locations, too, including retail stores and kiosks in other regions. In addition, Calo has partnered with a gym chain called Armah Sports Company in Saudi Arabia to offer a bundle of Calo and gym subscriptions.
