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Startup Spotlight: Cairo-Based Cupmena Is On A Quest To Create A Sustainable Agritech Sector Launched in February 2019, Cupmena's main line of business is simple: use the vast amount of nutrition available in spent/used coffee grounds to grow different types of mushrooms.

By Aalia Mehreen Ahmed Edited by Aby Thomas

Opinions expressed by Entrepreneur contributors are their own.

You're reading Entrepreneur Middle East, an international franchise of Entrepreneur Media.

Mahmoud Tohamy, Abdulrhman Elhalafawy and Mohamed Abdelgawad, Co-founders, Cupmena

This article is part of an ongoing series covering startups that have been a part of the Mohammed Bin Rashid Innovation Fund (MBRIF) accelerator program.

Who knew that one could use spent coffee grounds to grow organic mushrooms? Well, Cairo-based agritech and waste management startup Cupmena did- and the company is now proving itself to be a frontrunner in this space. Launched in February 2019, Cupmena's main line of business is simple: use the vast amount of nutrition available in spent/used coffee grounds to grow different types of mushrooms.

"Cupmena has built a waste collection system to collect spent coffee grounds (SCGs) to maximize value by reusing it to develop and empower solutions for the agricultural sector," explains Abdulrhman Elhalafawy, co-founder and Chief Business Officer of the startup. "We have developed a highly efficient biotechnology and agriculture methodology to cultivate mushrooms using the SCG as the main soil. After that, we also convert the used mushroom soil into organic fertilizers to give the land much needed elements from the coffee ground. We've thus built a valuechain to help coffee chains get rid of SCG waste in a safe way to save the environment."

Through this operational setup, Cupmena's services are also attempting to solve some very concerning issues within the agritech ecosystem. But before delving any further into that, it is perhaps important to understand why the source material is so pivotal to the entire business model in the first place. For starters, there is the sheer volume of coffee that is produced and sold on a global scale. "Coffee is the most consumed beverage in the world, and the world population drinks over 2.25 billion cups of coffee every day," says Elhalafawy. "That, in turn, produces over 16 million tons of coffee!" According to research by Statista, around 166.63 million 60-kilogram bags of coffee were consumed worldwide in 2021 alone- a considerable increase from the 164 million bags that were consumed in the previous year. In the Middle East and Africa (MEA) region, specifically, there has also been a recent growing trend of consumers opting for specialty coffee stores. To put things a little more into perspective: in Egypt, where Cupemena is based, over 104 million people consumed coffee in 2021 alone. The figures are similarly large for other countries in the MEA as well.

But here's where these statistics become worrying- and why Cupmena's operations become particularly significant. With the production of such mammoth quantities of coffee, come large used or spent coffee grounds- the source material that Elhalafawy initially alludes to. These areas are the direct result of brewing coffee and are usually regarded as waste. "Typically, spent coffee grounds are dumped into general waste and sent to landfills where they decompose to produce methane, a greenhouse gas with more than 20 times the global warming capacity of carbon dioxide," explains Elhalafawy. "Not only that, but it is also a loss of an intensive source of nutrients and energy, as well as a potential source of hazardous pathogens and organic leachates that can contaminate surface and groundwater."

Related: Startup Spotlight: Count'd Aims To Solve Pain Points In The UAE's Meal Planning Industry

Elhalafawy further explains that leaving these grounds unused and unattended is a lost business opportunity as well. "Throwing away this precious natural resource that still has broad and significant value and applications across several industries is an outrageous act of consumption that perfectly demonstrates the "take, make, dispose off' approach of our current linear economic structure," he adds. With this, it becomes obvious that Cupmena's services are catering to issues that go beyond just purely agricultural purposes. "If coffee grounds are recycled, valuable organic matter and nutrients can be recaptured as soil fertilizers, mushroom growers, conditioners, and mulch, and the methane it produces can be captured for electricity generation," explains Elhalafawy. "80% less carbon dioxide emissions can be achieved through this methodology rather than sending grounds to landfill. In this way we will be able to help the environment reduce the SCG's effects and exploit it in the right direction while also stopping the exploitation of resources."

All of this, according to Elhalafawy, also provides profitable advantages to more stakeholders than one in the overall ecosystem. "We help coffee chains save money on waste disposal costs through our coffee recycling service, and by recycling spent coffee with us, these companies can achieve greater sustainability," he says. "From a customer's perspective, they can easily buy high-quality, affordable mushrooms, since SCGs are full of nutrients. About 99% of coffee still exists inside these grounds, so we exploit them to provide top quality mushrooms." Some of the major coffee chains Cupmena has partnered with include Costa, Dunkin, 30 North, Amore Perfecto, and Brown Nose Coffee. As for the mushrooms Cupmena produces, they are sold on both a B2C and B2B basis.

At this point, you might be wondering: "Why mushrooms?" And Elhalafawy has the answer to that too. "The UAE market imports mushrooms worth US$15 billion every year, the Kuwait market imports mushrooms worth $10.5 billion, and Qatar $4 billion," he explains. "SCGs minimize our production cycle- it does not exceed six weeks. This gives us a competitive edge over others in the market!" Having collected 141,760 kilograms of coffee waste so far and prevented 17 tonnes of carbon dioxide emissions from entering the atmosphere, Elhalafawy says his startup is about to reach the breakeven point by the end of 2022's first quarter. "We are also planning to close an investment round by mid-2022 for operational scaling and research and development (R&D) and also to test new markets," he adds. It's to further these goals that Cupmena applied to be a part of the Mohammed Bin Rashid Innovation Fund (MBRIF) accelerator program. "The GCC market is vast, and we have been planning to start exporting and expanding our operations, " he says. "But our expertise regarding this area is limited. So, we applied for MBRIF to understand the market more and meet the relevant mentors and investors who could support our plans."

Elhalafawy says that Cupmena's R&D team is now looking into growing new mushroom strains to offer to the market. "We are also developing new agri-solutions using SCGs for the agricultural and agritech sectors in Egypt, as well as the wider MENA region," he says. And with plans to also introduce ready and cultivated mushroom bags for farmers in the region, as well as to sell SCGs as well as used mushroom soil to fertilizer companies, the Cupmena team is optimistic about the months to come.

Related: Enablers Of Success: Why Super Apps Aren't The Threat That Startups Imagine Them To Be

Aalia Mehreen Ahmed

Features Editor, Entrepreneur Middle East

Aalia Mehreen Ahmed is the Features Editor at Entrepreneur Middle East.

She is an MBA (Finance) graduate with past experience in the corporate sector, and was also co-founder of CyberSWIFTT- an anti-cyberbullying campaign that ran from 2017-2018 as part of the e7: Daughters of the Emirates program.

Ahmed is particularly keen on writing stories involving people-centric leadership, female-owned startups, and entrepreneurs who've beaten significant odds to realize their goals.

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