Boomtime for AgriTech startups


With over seventy percent Indian households still dependent on farming, the agriculture sector holds a huge potential for AgriTech startups. Modern technology, availability of good quality farm data, a better regulatory environment for startup funding, and cheap internet connectivity are some of the crucial factors leading to a thriving startup ecosystem, writes Hiren Kumar Bose.

India’s agriculture tech startups are undergoing a boom, with funding in the first half of 2019 jumping over three-fold compared with that in the previous year, a recent report mentioned elaborating on the coming of age of AgriTech. 
Applying modern technologies to the agricultural sector with the aim to enhance produce, efficiency and revenue is the idea behind AgriTech. The concept extends to any applications, practices, products and services that enhance any aspect of the agricultural process, be it an input function or the output received. AgriTech in India may also be applied to the associated sectors of aquaculture and horticulture.
With over 70 per cent Indian households still dependent on farming, the agriculture sector holds a huge potential for AgriTech startups. Digital transformation and the start-up ecosystem are playing a significant role in bringing innovation and disruption in the country’s agriculture sector. Technology firms are trying to break into the agricultural landscape using newer business models.
India can learn from Israel, China and US

Before we venture further let’s understand what ails the agriculture sector, and more importantly, why farmers` kids are shying away to become one.  Farmers still rely on manual labour—from sowing to harvesting; there is over-dependence on monsoon, and the rain-fed farmlands have a 40 per cent lower yield than irrigated farmlands. Then there are issues like fragmented land holdings, decreasing groundwater levels, and poor quality of seeds. The list seems endless if you include factors like lack of price transparency and a poor supply-chain process.  Interestingly, the AgriTech startups have brought a breath of fresh air to the sector.

If countries like Israel, China, and the US could transform agriculture practices in their country with the use of technology, why can’t India do it?. These countries have demonstrated that an assortment of technology like the introduction of hybrid seeds, precision farming, big data analytics, artificial intelligence, geo-tagging and satellite monitoring, mobile apps, and farm management software has been applied at every stage in the agriculture process to increase productivity and farm incomes in these three countries.

According to the United Nations, the world will need to produce 70 per cent more food in 2050 to meet the growing demand, and technology can help in increasing agricultural output. Several global organisations are developing new solutions for agriculture. The global precision farming market is estimated to cross US$5 billion by 2023 and grow over 10 per cent per annum during the period 2016–2023. The global agriculture robot market is estimated to grow at a Compound Annual Growth Rate (CAGR) of 21 per cent and touch US$11 billion by 2023. In tandem with these global trends, several startups have recently emerged in the AgriTech space in India.

The sector holds tremendous potential for technology adoption, considering the sheer size of the population involved. According to McKinsey Global Institute, the application of various digital and agronomic technologies can have an economic impact of US$45–80 billion annually by 2025. Not just that, 90 million farmers could potentially raise their incomes, 200–250 million Indians could benefit from better nutrition from abundant harvests and as many as one million Indians could find decent job opportunities as computer-equipped farm-extension workers.

AgriTech startups in India are working on an assortment of issues like enhanced supply chains, using big data analytics and artificial intelligence to optimise farm management, focusing on the financial aspect of farming, providing actionable insights to farmers, image sensing for quality assessment, storage monitoring based on the Internet of Things (IoT)and digitisation of local markets. 

Funding received by AgriTech startups till June 2019 was $248 million compared with $73 million in 2018—spurred by key deals with Ninjacart, AgroStar, WayCool, Jumbotail and Samunnati Financial Intermediation—as the industry focuses on strengthening the supply chain, according to a report by the National Association of Software and Service Companies (NASSCOM).
Presently, the country hosts more than 450 start-ups in the agriculture sector, according to the NASSCOM report. The sector is growing at a rate of 25%, year on year, and has over the recent years witnessed some of the global and sector-focused funds directly investing in AgriTech start-ups.

What AgriTech start-ups can offer

A few illustrations will help what AgriTech start-ups have to offer:

  1. FIB-SOL Life Technologies develops low-cost bio-fertilisers that help farmers to improve crop yield and soil quality. It also aims to improve product shelf life for manufacturers, help suppliers stock inventory efficiently, and boost farmers’ income as well. They offer three products under GEL and DROPS which contain microbes that provide nutrients to make farmland more fertile for cultivation.
  2. Bhopal-based startup AgriGator is building a platform directly connecting grain traders, food processors, wholesalers and logistics providers for efficient and transparent trade and transport. It is presently doing business with 200 local traders in nearby 11 mandis (markets), 15 food processors and more than 500 carrier providers. They plan to expand their operations to 10 cities in next one year.
  3. Launched in 2016, VilFresh provides village-fresh agro and milk products to people in Coimbatore. It also supports the livelihoods of small-holder farmers and rural youth.  So far it has provided employment opportunities to over 2,000 individuals. VilFresh has identified its priorities as the three Es – enriching farmers, empowering rural youth, and exciting urban customers.
  4. Mumbai-based FreshVnF founded in 2018 uses machine learning (ML) to optimise a farm-to-fork supply chain by connecting farmers with hotels, restaurants and cafes.  Claiming to have delivered more than 15 tonnes of fresh produce per day to more than 300 clients, it is now aiming to provide fresh farm produce to the end customer within 16 hours of harvesting.
  5. Fruit Box & Co, an e-commerce platform based in Delhi with B2B and B2C verticals, provides healthy alternatives to snack on fruits. So far it has tied up with over 500 farmers, wholesalers and importers. Their fruits are sourced from different countries across the world. While bananas, mangoes, oranges, grapes and strawberries are mainly produced locally, they import apples from the US and New Zealand, guavas and passion fruit from Thailand, avocados from Mexico, and pears from the US.
  6. Founded in 2010, Ecozen Solutions develops technology-enabled products to strengthen the farm-to-fork value chain of perishables, with a focus on renewable energy and sustainable development. Based in Pune, Ecozen has developed two products so far – Ecofrost, a portable cold room that maintains a low temperature, and Ecotron, a pump controller for irrigation. Both are solar-powered. Approximately 20,000 farmers in India have used their products, the company says.
  7. Jaipur-based FreshoKartz aims to integrate farms, farmers, vendors, traders, and customers on a common platform to structure the agricultural sector. Founded in 2016, it provides agri inputs to farmers through all crop cycles and claims to augment their income by 50 per cent. Apart from soil data-based crop and fertiliser recommendations, it also delivers quality seeds, pesticides and fertilisers through its network of physical centres. It is targeting one centre for every 10,000 farming population.
  8. Chennai-based Aquaconnect’s AI-powered platform is helping India’s shrimp farmers fight diseases and cut losses. Its app, FarmMOJO uses big data and AI to advice farmers on their pond operations. In addition to the inputs, the application also takes into consideration the data captured by IoT or smart farm management platforms. In the two years since inception, Aquaconnect claims to have brought 3K farmers on board and has generated a revenue of Rs 2.4 Cr in FY18.
  9. Founded in 2016, AutoNxt envisions a tractor-sharing platform to reach more farmers and make its tractor more affordable. The Mumbai-based company’s prototype autonomous electric tractor has been developed for a range of farming operations including tilling, spraying pesticides, ploughing, sowing seeds and more. AutoNext wants to first sell to grape cultivators in wine-producing regions such as Nashik and Karnataka.

Availability of good quality farm data, a better regulatory environment for startup funding, and cheap internet connectivity are some of the crucial factors leading to a thriving startup ecosystem. The increasing penetration of budget smartphones, cheap access to high-speed internet, and the growing regional online content are helping B2F  (Business to Farmer) companies with direct access to farmers. Several Indian states have established AgriTech policies but it`s only two states, namely Maharashtra and Karnataka who between themselves account for 50 per cent of AgriTech startups in the country. With the given pace of investments, AgriTech sector may soon take the centre stage of India’s transformation. 

Hiren Bose

Hiren Kumar Bose is a journalist based in Thane, Maharashtra. He doubles up as a weekend farmer.