In Covid time, city agri-food tech firms go for the big kill

The coronavirus pandemic, floods and heavy rains caused severe disruption to food supply chains and hampered the delivery of agricultural products from markets to consumers.

While the pandemic ravaged the markets and supply chains, Bangaloreans made a significant shift in their grocery shopping habits as millions of them shied away from visiting crowded markets while technology driven modern delivery platforms stood up during this time to help people cater to their daily needs for vegetables and fruits.

Not surprisingly, online grocery shopping platforms, especially those in the business of supplying perishables like vegetables and fruits, were the only ones that weathered the brutal blow of Covid-19. During the pandemic time, agri-food tech end-to-end aggregator platforms that connect premium perishable vegetables from farm to fork have steadily raised funds from venture capitalists (VCs) and angel investors.

A recent report by Maple Capital Advisors projected VC investments in agri-tech startups to exceed Rs 3,730 crore in the next two years. During the lockdown when Covid-19 was starting to show its deadly impact, Bengaluru-based e-grocery unicorn BigBasket had raised a debt funding of Rs 380 crore from its existing investor Alibaba Group.

Ninjacart, B2B foods supply chain company co-founded by Thirukumaran Nagarajan that connects farmers directly to food service providers, retailers and restaurants, although did not raise fresh funds from Venture Capitalists or angel investors, it undertook several initiatives to deliver essential supplies amid the Covid-19 lockdown. "We have started supplying fresh fruits and vegetables to several residential communities and apartments in seven cities across Bangalore, Chennai, Hyderabad, Mumbai, Delhi-NCR, Pune and Ahmedabad. The initiative has addressed the problem of panic buying and the fear of shortage. The initiative also saved the produce of the farmers from going waste. We are currently facing a deluge of demand. Additionally, we are providing our services of supplying essential food items to orphanages, old age homes and slum areas at subsidized rates, which will be much lesser than the on-going market rates. These are the challenging times as the retail prices of food items have hiked by 80% and accessibility is a big challenge," Thirukumaran Nagarajan told The Hans India.

Aibono (AI & BONO), an Artificial Intelligence-powered fresh food farm aggregator co-founded by Vivek Rajkumar, saw Covid-19 as the right time to go for the kill by expanding its offerings. The startup procures farm produce from farmers in Nilgiris and sells it to retailers in the city. In the midst of the pandemic crisis, the city-based startup, which sources fresh vegetables and fruits straight from the farms from the Nilgiris in Tamil Nadu, had raised nearly Rs 15 crore fresh capital from VC firms, including Mitsui Sumitomo Insurance Venture Capital, Rebright Partners and Lesing Artha. The startup is expected to use the funds to increase its farmer strength by adding over 2,000 farmers to its platform.

Clover, a city-based startup co-founded by childhood friends Santosh Narasipura, Gururaj Rao and Arvind Murali, had raised Rs 7 crore funds from Alteria Capital. Talking to The Hans India, Arvind Murali said, "Agritech is a big opportunity. It has grown more than 10 times in the last few years. Despite Covid-19, agritech food companies leveraging on technology are gaining. Investors are paying attention to startups that survive recession or situations like the pandemic."

Talking to The Hans India over phone, Ashwin Kumar, co-founder of KrishiDirect, foresees big investments from VCs and angel investors in agri-food tech end-to-end aggregator platforms given the disruption caused by Covid-19 pandemicc. "Investors are seeing huge potential in technology driven modern delivery platforms that supply perishables like vegetables and fruits because of the attractiveness that essential services sector brings with it, especially during the pandemic. We buy fruits and vegetables directly from the farmers and deliver the freshly farmed fruits and vegetables at the doorstep of the people living nearby. People, living in Bangalore, can order fruits and vegetables from Krishi Direct via krishidirect.com. During the pandemic, we have seen that the consumers and farmers are fast adapting to technology," says Ashwin Kumar, who owns large coffee estates in Chikmangaluru.

City-based foodtech unicorn Swiggy, founded by BITS-Pilani alumni Nandan Reddy, Rahul Jaimini, and Sriharsha, raised $43 million in funding from Tencent, Mirae Asset Capital Markets, Korea Investment Partners, Samsung Ventures and Ark Impact.

Another city-based agritech startup Vegrow, co-founded by Shobhit Jain, raised $2.5 million in funding from a clutch of VC investors and angel investors, including Matrix Partners India and Ankur Capital.