United Arab Emirates-based shared micromobility operator Fenix is expanding the use of its electric scooters and back-end logistics to not only move people, but also to move goods. On Tuesday, the company announced the launch of a 10-minute fresh grocery delivery service on Reem Island, a dense, mixed-use development off the coast of Abu Dhabi.
Fenix’s new service, F10, will utilize available vehicles from the operator’s normal shared fleet for deliveries. Delivery riders will also be considered shared resources with Fenix’s e-scooter service, taking turns between making fast deliveries and swapping batteries. The company is building a single integrated platform to manage the fleets and services.
The shared e-scooter business is still new and has not yet been incredibly profitable for existing operators due in large part to the low life expectancy of the vehicles and the cost of paying workers to swap batteries. Fenix’s expanded business model is a novel way to make the most out of the sunk cost of its hardware and employee base while also exploring a market that is expected to grow by nearly $632 billion over the next three years, according to market research and advisory company Technavio.
Logistically speaking, Fenix might be on to something. Its “dark stores,” or compact, private retail facilities, are scattered around Reem Island in optimized locations, each with a large catchment area that falls within a narrow delivery radius, according to Jaideep Dhanoa, co-founder and CEO of Fenix. Dhanoa did not reveal how many dark stores the company has placed throughout the island.
“For Fenix, the dark store is also a distributed charging center for our swappable battery e-scooter operations, which allows us to share the real estate costs between the two businesses and also increase the productivity of our e-scooter operations via more distributed charging locations,” said Dhanoa.
Dhanoa said Fenix’s full-time employees, who are all company stakeholders, are trained to accept, pick and pack items for delivery in the dark stores within two minutes before relaying the goods to a rider who has a mere eight minutes to make it to the customer. Not a stressful situation at all! It wouldn’t be surprising to see Fenix’s next funding round focus on R&D for robots that will gather groceries faster and without the pressure of human error.
Such quick delivery couldn’t be done without urban density, which is largely what drew Fenix to Reem Island. The small island, which is one of the only free zones in the city where foreign nationals can buy property, holds a residential population of about 100,000 people. Dhanoa said the island also presents multiple use cases in the form of residential and commercial towers and shopping malls.
“Wherever there is a dense population, there will be a market for F10,” said Dhanoa.
The new business expansion was in part funded by an undisclosed round that was recently raised from existing investors, like Maniv Mobility, the Israeli venture firm that also funded electric mobility company Revel and invested $3.8 million in Fenix’s seed round last November. (Maniv Mobility’s investment in Fenix was the first time an Israeli firm invested in a business from the UAE, a sign that companies are making good on the Abraham Accords’ promise to normalize relations between the two countries.) But Dhanoa told TechCrunch that the costs of launching the F10 delivery service didn’t require deep pockets, “given the unique synergies with our existing micromobility business.”
The F10 app can be downloaded in the Google Play Store and the iOS App Store. To kick things off, Fenix is offering new users their first order up to AED 50 (~$14 USD) for free.