Kune Food, a Kenyan food-tech startup that a year ago announced a controversial $1 million pre-seed fundraising round, has hit rock bottom. Frenchman and CEO of the one-year-old firm, Robin Reecht, stated in a social media post that despite selling more than 55,000 meals, acquiring more than 6,000 individual clients, and 100 corporate customers, the $3 per meal fee was insufficient to maintain the company’s growth.
“Sad day,” Reecht said, “with the current economic downturn and investment markets tightening up, we were unable to raise our next round. Coupled with rising food costs deteriorating our margins, we just couldn’t keep going.”
Read also Telkom Kenya Launches New Data and Voice Sharing Product
Reecht, who founded Kune Food after a three-day frustrating stay in Kenya and on the basis of a three-week “research” stint, stated that Kune’s staff would be hardest hit by the shutdown.
“My first thoughts go to my team. You put your heart and soul into building the Kune that so many people loved. I’m deeply sorry it didn’t work out,” he said.
Reecht urged the entrepreneurs in his network to assist the stranded employees of Kune.
“Please check the Kune “employee page” on LinkedIn and see if your recruitment needs could be filled by some of our team members,” Reecht pleaded. “I know those are difficult times for you too. But they are terrific people who will bring tremendous value to your company. You can call me if you need any reference on a Kune employee.”
Read also Ghanaian Credit Fintech Fido Raises $30M Series A Round, Backed By Israeli Investor
Reecht also expressed regret to his investors for the premature demise of his Kune vision.
“Some of you joined the Kune journey when it was just me and a Chef, delivering food on foot to a nearby office,” Reecht said referring to the investors. “Some others joined later and helped us grow into a foodtech startup with a tech platform, a factory, a kitchen studio, 7 distribution hubs, 6000 customers, and a team of 90 people. Not only did you invest in Kune but you gave us your time, brain-width, connections, and emotional support. I am deeply sorry that Kune’s vision didn’t come true. To betray your confidence is something for which I will never forgive myself.”
“My third thought goes to suppliers, customers, bankers, and partners of any sort who supported us along our way. I’m sincerely sorry for the outcome,” Reecht added.
Kune Becomes The Latest Startup To Surrender To The Biting Dust Of Funding Crunch Currently Afflicting The Global Startup Ecosystem
Although Kune could not die without a fight, its final throes looked to be occurring at an unfortunate time. According to a recent report, the global IT ecosystem has been experiencing a financial crunch. In the first quarter of 2022, both the United States and Asia had negative year-over-year growth, while Europe and Latin America maintained a Y-o-Y growth of over 30%.
Read also Ghanaian Credit Fintech Fido Raises $30M Series A Round, Backed By Israeli Investor
The first throes of Kune’s death began a few weeks ago when it abandoned its initial intention to internalise all production and human resources capacities and instead decided to sell entirely on the platforms it was attempting to disrupt.
“I spoke to 100 investors at least since the beginning of the year. I have exhausted my options. Am just not able anymore to raise money, it’s impossible,” the CEO says.
According to sources, Kune was seeking an additional 400 million Kenyan shillings ($3.5M) to improve its production capacity and extend into further regions of Kenya. The managing director informed Business Daily that the $1 Million (about KES 100Million) was utilised to expand production capacity, build research skills, and strengthen delivery.
“I looked for some companies to buy Kune. I spoke to the CEO of Java, ArtCaffe, Nas Servair, Bidco, and several others, no company is interested to buy Kune,” the CEO told the devastated employees. “We don’t sell enough meals every day…We are still a niche product and so was unable to find an acquirer. Which I was trying to do to prevent you from losing your jobs and other investors from losing their money and the company.”
Kune’s Pre-seed Fundraising Was Marred By Controversies
Kenyans were angered by unsavoury remarks made by Robin Reecht on the occasion of the company’s successful pre-seed investment round one year ago. Robin stated in an interview with the American technology news outlet TechCrunch:
Read also South African Payments Startup Talk360 Raises $4M Seed Funding Round
“After three days of coming into Kenya, I asked where I can get great food at a cheap price, and everybody tell me it’s impossible. It’s impossible because either you go to the street and you eat street food, which is really cheap but with not-so-good quality, or you order on Uber Eats, Glovo or Jumia, where you get quality but you have to pay at least $10.”
Kenyans equated the views of the founder of the yet-to-be-launched startup to the common “white saviour” mentality and “white privilege” that many Western, white people have whenever they land on the African continent.
One Kenyan, Natasha W Parrish, tweeted in the aftermath:
Adding to Wanjiru’s concerns, is Aleya Kassam who marveled at the ease of access to funds by Reecht, based on a three-week “research” timeframe, as well as what problem Reetch was trying to tackle.
What’s Next For Kune?
Reecht believes that many things at Kune should have been done differently, and better. However, he believes that the upcoming months will provide his crew time to reflect on Kune’s failure, and he hopes to discuss it at the appropriate time.
In the interim, it would be prudent for Kune to liquidate its assets.
“If you know anyone who could be interested to acquire Kune’s IP or Assets, please reach out by PM,” Reecht said.
In Summary, Here’s What Kune Food Did While It Existed
Kune, founded by CEO Robin Reecht in December 2020, provided freshly prepared, ready-to-eat meals. After a preliminary test in early 2021, the business debuted its freshly prepared meals and on-demand delivery service in August, 2021 serving Nairobi’s working and middle classes
Kune Food shuts down Kune Food shuts down Kune Food shuts down Kune Food shuts down
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh