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AgriTech Blog Series: Last 5-year Journey of AgriTech (1)
AgriTech Blog Series: Last 5-year Journey of AgriTech (1)

October 31, 2022

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Indian agriculture is often called "immortal" by many leading investors and key stakeholders in this sector. We all agree that India’s future is inseparable from agriculture. Being self-sufficient with a 1.4 billion population is an achievement. India will continue to be the exporter, which will be more pleasant going forward. India’s seafood exports continue to soar and are now at $8 Bn, thanks to shrimp, which make up nearly 70% of total seafood exports. India is now the world’s second largest producer of shrimp. This export scenario was drastically different 10 years ago. India is blessed with a large base of 130 million small-holder farmers, which is >25% of the total and they actively deploy frugal engineering concepts. The key point is that if we can manage the bottleneck well, India's agriculture can show a new path of development to the world. Thanks to the will and effort of the agricultural enterprises who are leading from the front.

Above are the strong words of some leading investors and stakeholders in this sector. This point of view has not been built up in a few months. It took a decade to reach this level of trust, but the last 5 years have been a key differentiator. So, what has changed in AgriTech in the last 5 years? NASSCOM released its brief report on AgriTech in 2018 titled "AgriTech in India – Maxing India Farm Output" and a lot has changed since then.

>5X increase in number of AgriTech start-ups: From 500 in 2016-17, now the number is 2000+. Funded start-ups make up almost 20% of the total number.

Cumulative funding has increased by a factor of ten in the last five years: It was $300 Mn as per the last NASSCOM report, and now it has reached $3+ Bn. Credit can be given to the pandemic, which made us realise the importance of agriculture. AgriTech sector raised over $2Bn in funding in the last 2 years, majorly driven by large funding rounds by scaling AgriTech start-ups.

Agritech2

AgriTech supply chain business solutions continue to dominate, but in the last 5 years, new models have spread their wings in this sector like farming as a service, post-harvest traceability, farm data platforms, insect farming, and many more.

High Ticket Size Funding: High ticket size was not common in AgriTech a few years back, but now such deals are easily happening. In the last 2 years, we observed over 10+ $50 mn deals in AgriTech led by start-ups like Licious, Ninjacart, DeHaat, WayCool and more.

Key Investors: There has been a threefold increase in active investors since 2017. Investors' loyalty towards AgriTech is going strong. Investors like Accel, Aspada, Temasek, Sequoia Capital, Omidyar Network, Kalaari, Omnivore, and more continue to be the key investors in the AgriTech sector.

Median Round Ticket Size: Median round size increased by 2X in the late stage, 2.5X in Series B, and 3X in the seed stage.

Stage Wise Investors Focus: Increasing interest and focus towards specific stage AgriTech start-ups: Top 3 AgriTech investors for different stages are all different.

  • Seed Stage: Omnivore, Social Alpha, and Ankur Capital
  • Early Stage: Accel, Aspada, Temesek
  • Late Stage: Sofina, GAWA Capital, Evolvence India

Soaring Potential Unicorn List: Over 15+ companies that have the potential to become unicorns in the near future. DeHaat, WayCool, Ninjacart, Agrostar, and many more.

 AgriTech ecosystem has come a long way in the last 5 years. The most surprising part is that this growth has not happened only in one area, but it has happened across every business aspect of this sector. Seeing the last 5 years of growth and investors' trust, we can expect some great fireworks.


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