Once overlooked, agritech startups have a moment in India.
On Tuesday, DeHaat, an online platform that provides comprehensive agricultural services to farmers, announced that it had raised $ 30 million in a new round of funding as the Indian company seeks to maintain its accelerated growth despite the pandemic.
Prosus Ventures, formerly known as Naspers Ventures, led the Series C funding round for the Patna and Gurgaon-based startup. RTP Global and the existing investors Sequoia Capital India, FMO, Omnivore and AgFunder also took part and brought the startup's donation to over $ 46 million. (Dexter Capital was the advisor for this funding round.)
One of the greatest challenges for farmers in India is securing agricultural products such as seeds and fertilizers and finding buyers once the yields have been achieved.
DeHaat, Hindi for village, solves this problem by bringing brands, institutional financiers and buyers to a platform that can be accessed via a hotline and an app in the respective national languages.
According to industry estimates, only about a third of the yields produced by Indian farmers reach the large markets. Traditionally, it has been extremely difficult for farmers to find buyers for their products.
Once the season is over, DeHaat will help farmers sell their yields to bulk buyers such as the business-to-business marketplace Udaan, Reliance Fresh and the grocery shipping company Zomato.
The 10-year-old startup has also developed a database of harvest tests and uses artificial intelligence to offer farmers free personal advice on what to sow in a season. DeHaat also helps farmers secure working capital through partnerships with hundreds of institutional companies.
We wrote about DeHaat last year when it took out a $ 12 million funding round. The past nine months has been the story of its accelerated growth despite the coronavirus pandemic that led to lockdowns across the country for several months.
The startup, which is present in East India today – states like Bihar, Uttar Pradesh, Jharkhand, Odisha, and West Bengal – serves nearly 400,000 farmers, up from about 210,000 last April, Shashank Kumar, co-founder and chief executive of the startup, said . in one Interview.
Just as impressive is how the startup is tackling these challenges. It works with nearly 1,400 micro-entrepreneurs in rural areas, up from around 400 last year, who distribute over 4,000 types of agricultural commodities from their regional hubs to farmers and then bring production back to the same hub. "They are the ones responsible for delivery and aggregation on the last mile," he said.
DeHaat has grown on every front including the revenue it generates, which has increased 3 to 3.5 times since last year, he said.
“At the end of March, our daily volume was around 200 tons. Now it's over 600 tons. Every day we collect so much from farmers and supply to FMCG players and modern retailers. Similarly, on the farm side – seeds, fertilizers and pesticides – we process nearly 10,000 orders a day, compared to about 2,600 in March last year, ”he said.
"Prosus Ventures invests in industries around the world where innovation can significantly meet societal needs," said Ashutosh Sharma, head of India Investments at Prosus Ventures, in a statement.
“DeHaat serves a huge market in India with an agricultural sector in excess of $ 350 billion for the country's economy, which is an estimated 140 million farmers. DeHaat's full range of agricultural services will have a huge impact on society in India, improving the earning potential of Indian farmers and the overall yield for the sector, while also enabling often less for micro-entrepreneurs across the country, including those in rural areas where they exist Income opportunities, ”he added.
The startup plans to use the fresh capital to expand it to other Indian states, including Rajasthan, Madhya Pradesh and Maharashtra, and ultimately to supply 10 million farmers.
Another area the company wants to focus on is hiring top tech talent. The startup has doubled its workforce since last year, with many high-profile employees from large companies. The startup, which recently made its second acquisition, is also open to further M&A opportunities, said DeHaat's Shashank Kumar.
Once ignored, numerous agritech startups have emerged in India over the past few years – and many old startups are starting to get big checks from investors.
Around two dozen #agritech startups have collected donations this year (to date).
Fresh zone of the farmers
– Harsh Upadhyay (@ upadhyay_harsh1) October 13, 2020
Further reading: Omnivore and Accel recently collaborated on a report on India's agritech landscape.