Over the years, the focus on AgriTech startups has increased across the world. As the conversation about sustainable development and greener means takes centre stage in the present scenario, AgriTech startups have found a vacuum for them to innovate and thrive in this competitive market.
In India, the situation is no different for private players and government agencies, as both are dependant on technological advancements to usher in progress. With the global food grain production estimated to grow by 330 million by 2050 and with India estimated to contribute 15% to this rate, the sector has witnessed a great enthusiasm to cater to this demand.
The AgriTech Startup Ecosystem In India
Over the last few years, the number of AgriTech startups has increased manifold with the five main focus being supply chain, infrastructure development, finance and related solutions, farm data analytics and information platforms. According to a 2018 combined study by PWC and FICCI, a total of 366 agri-based startups have come up from 2013 to 2017, which is an indication of the growing ecosystem.
Further, the study stated that an estimated 300 agri-prenuers are believed to be in India, catering to different needs and challenges in the sector.
The Four Broad category
As the technological advancements bring with them the ability to make sweeping changes, a lot of young agriprenuers are turning to emerging technologies like artificial intelligence and Internet of Things (IoT) to help scores of farmers who lag behind in adopting latest technologies. Of all the startups working in this field, their workings have been broadly categorised into four categories based on their modus operandi.
Big data: Some of the big names in this field include startups like SatSure which uses drone image processing and big data capabilities to improve farmer’s crop insurance, innovate on agri-lending services among other services. Other popular startups include Fasal and Aibono to name a few.
In essence, these startups use the technology to provide farm-specific, data-driven diagnostics to help farmers know more about crop and soil health etc.
Market linkage model: One of the biggest challenges that the farmers face currently is to find the right takers for their product for the right price and to avoid the role of middle-men, who has a majority stake in the selling and distribution of products. Thus, several AgriTech startups act has e-distributor of products, develop a listing platform and often create an e-market giving the farmers the major share of their income. Startups involved in the supply chain include Crofarm, CropIn and Ninjacart, among others.
Farming-as-a-Service: Farming-as-a-Service seeks to provide affordable technology solutions for efficient farming by identifying a particular aspect related to farming. The services that they include on-demand harvesting, digital payment, marketing pricing etc
One of the prominent name working in the field is EM3 Agri Services which aims to increase productivity by combining tech and mechanisation.
IoT-based Startups: There are presently countless startups working in this area which combines the best of new-age technologies to provide service like smart farming, data-collection, information on crop yield etc. Gold Farm, Omnivore and Intello Labs are some of the startups working in the field.
Since the startup bubble broke in India, investors at home and abroad have been eyeing India’s diverse AgriTech startups which have been growing by leaps and bounds. Over the years the number of investments, acquisitions and accelerator programmes targetting these startups have increased by several folds.
In 2017, Bengaluru-based SaaS solutions provider for agribusinesses, CropIn, raised $8 million in Series B funding. The funding for this round was led by Chiratae Ventures (formerly IDG Ventures) and the Bill and Melinda Gates Foundation Strategic Investment Fund. While another startup Stellapps were in news early 2018 for bagging $14 million in the largest equity funding rounds led by Bill and Melinda Gates Foundation and IndusAge Partners.
In 2019 the trend caught on, some of the names include Chennai-based WayCool Foods raised $16.9 million from LGT Impact. In a similar case, Chandigarh-based AgNext raised $4 million as Pre-series from venture Kaalaari Capital in January this year.
However, the interesting development in the field has been that of the role of involvement of external players in mentoring AgriTech startup. Yes Bank as part of its in-house multi-sector start-up accelerator, Yes Scale, it has shortlisted as many as eight AgriTech startups for the 15-month accelerator programme aimed at creating financial innovations by sourcing, scaling, and sustaining emerging.
Speaking about Yes Scale, Rana Kapoor, MD and CEO, YES Bank said, “The success of two cohorts of YES Fintech has demonstrated our Bank’s strengths in partnering FinTechs to co-create industry changing Banking solutions. Now, with YES SCALE, we will replicate this model across YES Bank’s focus sectors like Smart Cities, Agriculture, Clean Energy, Education and Healthcare, to build deep interventions jointly with our corporate clients. This is fully in line with the Bank’s vision since inception
The Government’s Role
While private players have been making a substantial stride in the field, the government accelerator programmes like AGRI UDAAN – Food and Agribusiness Accelerator 2.0 was launched in 2017 for direct mentorship under the government. The six-month programme entailed six months long training and funding of ₹25 lakh.
In addition to this, through its programmes like Startup India, Atal Innovation Mission it has been supporting the startup ecosystem greatly.
Speaking about the role of technology in driving change, Suresh Prabhu, The Union Minister of Commerce and Industry and Civil Aviation said, “I am happy that keen interest has been evinced by agri-startups to harness the potential offered by the agriculture sector. It is crucial to expose such Indian agri-startups to international innovations in this sector.”
However, with the announcement of the recent budget, the government has taken a step backwards by slashing the startup allotment by Rs 25 crore, further, the AgriTech community were not pleased with the lack of support for them. While speaking to a leading online portal, Alekh Sanghera, founder of Farmart highlighted the need for the government to increase cooperation between AgriTech startups and government entities.
While the government has acknowledged the role of startups in India, the future of the sector lies in integrating different domains of knowledge and skill in agri-innovations. Further, large-scale adoption of government’s like Startup Agri India scheme, the Digi Gaon (Digital Village) initiative, and Bharat Net Project will help the industry greatly.
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Akshaya Asokan works as a Technology Journalist at Analytics India Magazine. She has previously worked with IDG Media and The New Indian Express. When not writing, she can be seen either reading or staring at a flower.