After winning a pitch competition that promised a cash prize of $60,000, Yanzo co-founder and chief executive Tarek Osman, thought he'd secured enough to accelerate his startup’s plans. What Osman and his three co-founders had not anticipated however, was walking away empty-handed from the contest after the event organisers failed to hand over the winnings, citing issues with their sponsors.
Unfulfilled investments are terribly common in the startup space, with some founders claiming that investors have pulled out even after all contracts have been signed. This can be devastating for a startup, and for Yanzo, the on-demand digital assistant based in the UAE, it slowed its plans significantly.
But now Osman and his co-founders, Mohammed Jaffar, Wassim Aboueida and Magieda Abaza, are hoping to secure funding from those who know their company best - the customers.
Yanzo has partnered with UAE-based Eureeca, launching a crowdfunding campaign in a bid to raise $700,000, with entry level ticket sizes been priced at $500.
“We were looking at a couple of ways to raise funds,” says Jaffar, who heads up partnerships. “We’re more at the pre-Seed stage, the family and friends stage and so the best approach is to go through crowdfunding.”
Crowdfunding does not enjoy a particularly good reputation in the region, something that is partly down to lack of awareness, slow-moving regulations and lack of access to financial products among the general population.
“It’s [crowdfunding] is something new to the region and like anything that is new, there is worry or fear around it. I truly believe that if one, two or three big companies come out of this [way of raising investment], it will gain traction. In the US or UK, it is the go-to platform for raising funds,” says Jaffar.
Launched in October 2018, Yanzo acts like a digital personal assistant. It does not have its own standalone app, once users set up an account and provide their preferred payment method, all interactions with the company take place on Whatsapp.
“Yanzo is an operational conversation platform, it’s like talking to someone who knows you and personalises your request based on the learnings and history of your orders,” says Osman. “Getting everything done is definitely the superpower Yanzo has.”
Working with a wide host of partners, including offline retailers, Yanzo’s team undertakes the research required for the customer request, identifies the right supplier and shortlists the options to fulfil an order. So, if a customer wants to host a party, Yanzo will identify all the suppliers that can fulfil the requirements – from hiring furniture, buying balloons and a cake to designing the invites. All this is done via Whatsapp and a third-party delivery company will deliver it all directly to the customer.
“There is not enough time to do the things we enjoy doing, ideally we want someone physically there and be a personal assistant, but the next best solution is knowing that it’s being taken care of,” says Jaffar.
These requests were initially fulfilled manually, but after in-kind investment from an Egypt-based technology agency, the startup has now automated 90 per cent of its manual operations.
“We minimise the human factor in the operational backend, but from the customer interface, they should not be able to notice this upgrade,” says Osman.
Yanzo grew 15 fold as a result, and went from fulfilling 220 requests per agent every month to managing 1800 orders per agent a month. This has also cut down order times and helps the team better manage and identify order patterns for each customer. This enables the startup to offer high levels of personalisation which has helped customer and user retention rates.
“After Covid, we grew massively, we focused on the technology and developed he necessary tech, so now we need more investment to go to the next level,” says Jaffar. “It was critical for us to go to our customer first [for investment]. They’ve been loyal to us and we want to give them the first chance to make this the thing we want it to be.”
The investment raised via Eureeca will be used primarily to fuel Yanzo’s expansion. The startup will be expanding to Saudi Arabia before the end of year with plans to launch in Egypt and Kuwait thereafter.
“We have huge ambitions for Yanzo, we see it saved in every contact list in Dubai, it’s a super app without the app,” says Osman.