How cryptocurrency investments helped a Canadian restaurant chain grow into a pandemic
Tahinis is known as the first restaurant chain in the world to invest 100% of its cash reserves in cryptocurrency. Its founders, brothers Ali and Omar Hamam, say bitcoin played a key role in the company’s expansion amid the COVID-19 pandemic and rapid inflation, which led to a sharp rise in the price of ingredients for shawarma and other dishes.
The company, based in London, Ontario, Canada, first invested in bitcoin in August 2020.
“To date, we’ve received more than 460% of our initial investment and we’re not stopping there,” Tahinis marketing director Ali told us in a recent interview. – “We will continue to convert excess revenues into bitcoins.
“We were buying cryptocurrency even at its highest rate, in April 2021, and when it collapsed. Month after month, we just kept buying bitcoin, and it worked as a hedge,” Ali explained.
In August 2020, the bitcoin rate dropped below $12,000. At the time of publication, it is around $57,000 after last week’s record high of over $69,000.
Tahinis’ strategy is that the company operates in fiat currency, Canadian dollars, and then invests all profits in bitcoin. Ali ignored bitcoin for a while after his idol, financier Warren Buffett, called it “rat poison squared” in 2018.
Tahinis keeps working capital in cash for months and then invests the profits in bitcoin. Tahinis could not disclose how much bitcoin it holds on its balance sheet, but said it has had more than $8 million in restaurant sales in the past year.
The company will expand its number of restaurants from eight to nine in 2021 and plans to open a total of 29 locations in 2022. Ali said Tahinis is working with dozens of small businesses around the world to help them implement a similar strategy.
“The main problem is that the dollar is depreciating,” Ali complained. – Central banks say inflation is only 5 percent. But it depends on what you have to buy. Since March 2020, poultry has risen by 45%, beef by 25%, imported goods and spices by 65%, and oils by 110%. So it makes sense to invest in bitcoin to get ahead of any rate of inflation over the next decade.”
The topic of currency devaluation became especially acute for the Hamam brothers after their parents’ savings were hurt by the 65% drop in the Egyptian pound against the U.S. dollar between 2012 and 2017. The brothers were in Tahrir Square in 2011 during the Arab Spring, which led to the overthrow of then-President Hosni Mubarak.
The following year they came to Canada to start a new life there. This is how the Tahinis chain came into being. The Hamams had previously acquired dual citizenship thanks to their father, who earned a doctorate in Canada and then worked as a mathematics professor in Saudi Arabia.
The Tahinis installed bitcoin machines in each restaurant to encourage employees and customers to buy cryptocurrency. But bitcoin is not accepted to pay for food because accounting and tax records are much easier to keep in fiat currency.
Tahinis began recovering from the pandemic in May 2020, after sales dropped 80% and many employees had to be laid off. In addition to bitcoin, the move away from personal service and toward a fast-food restaurant model came to the rescue.
“More people bought the franchise after the pandemic than before it,” Tahinis CEO Omar Hamam told me.
“Our marketing team works every day to post entertaining content and get Tahinis food seen on TikTok and Instagram,” Omar said. – The in-house vendor company also helps a lot. We really approach running the business with every aspect in mind without exception.”
Author: Artem Mailyan