Food delivery startups are just restaurants – Forbes

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The food delivery startup sector is a misleading fad.  It’s not an emerging tech disruption, but rather, it’s just a trend for restaurants to call themselves by a new name.  At least according to a recent Forbes article.

Considering the rush of food delivery startups launching in the US market and receiving phenomenal amounts of funding – one startup, Maple, just landed US$22 million -, Forbes’ Brian Solomon argues that food delivery startups are not real tech startups, but rather just restaurants reinventing themselves under a new image.

Solomon says despite appearances, the food delivery tech-startup sector is not getting overcrowded – it doesn’t really exist after all.  It’s actually the restaurant sector, he says, which is getting busy.

“My advice […]: don’t invest in ‘food delivery startups.’ Just make your existing restaurant staff look younger, hire some data scientists, and call yourself a tech company. It’ll do wonders for your valuation,” Solomon concludes.

African markets are also seeing the beginning of a boom in food delivery startups.

For example, in Kenya at the moment first mover Yum is battling Africa Internet Group (AIG)-backed hellofood for dominance in the market.

Is this just the start of African restaurants reinventing themselves under a new name? Are these startups really leveraging tech to disrupt the sector?

I think it is disruption.

The value offering in Africa of circumventing infrastructural challenges and inconveniences – bad roads, busy roads, restaurants’ common failure to establish reliable online presences – is weighty.

As hellofood Kenya managing director (MD) Arnaud Foubert told Disrupt Africa recently: “hellofood’s service both brings consumers the convenience they need and helps them save their precious time.”

“Traffic congestion may be seen as [an obstacle to food delivery startups], but it actually reinforces the interest of our service, which allows people to avoid the hassle of wasting time in traffic,” Foubert said.

With Africans notoriously tech-forward in adopting new mobile solutions, the convenience value of food delivery startups which also tap into the mobile market could shake-up the food hospitality market across Africa.

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Inspired and excited by the African tech entrepreneurial scene, Gabriella spends her time travelling around the continent to report on the most innovative tech startups, the most active investors, and the latest trends emerging in the ecosystem.

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