Why Contract Farming Could Be The Next Big Thing For Agritech Startups

Why Contract Farming Could Be The Next Big Thing For Agritech Startups

Nowadays, Agritech Startups farming is taking a massive step. That is with ‘technology’ and with this incredible idea. We can see the future for the farmers and agriculture production in India. Typically, the farmers agree to a contract proposed by the buyers.

It can help the production and marketing of a farm and its products. Now let’s dive into ‘Agritech’ as we know that these days upgraded technologies. These involve in agriculture are called Agritech or agro-technology. It improves the input and output of that process. This process will be farming as a service start-up for Agritech Startups.

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Due to the situation of Covid-19 in India, the traditional supply got disputed. Thanks to start-up companies, investors who took part in, and are helping farmers and the tradition to rise again. Farming-as-a-startup (FaaS) service idea is a sustainable idea.

It’s also a helpful idea for the farmers to build up their cultivation. They can provide farming equipment at an affordable price, to ensuring the production of the crops. There are a few innovative and successful start-ups. These start-ups have excelled and also admired by the farmers such as:

1) Oxen Farm Solutions: Vishwajeet Sinhav is the founder of this start-up. He claims that the company brings all the parties as an omnivore partner. That involved like the farmers, farming equipment producers. The government policies are all together in one platform.

He also includes automation as the issue faced by every labour. And some equipment is expensive for the farmers to buy them. So he decided to help the farmers. That is also to rent out equipment at affordable prices.

2) Gold Farm: The founders Abhilash Thirupathy and Karthic Ravindranath have a vision. That is to help the farmers and tractor drivers. It can be possible via mobile app or by contacting the call centre. It Founded in 2016. So far the firm has converted 7,500 hectares of barren land. It has helped cultivate and harvest over 25,000 hectares of land across two districts. 

3) Trringo: It was launched by Mahinder & Mahinder Ltd in 2016. It also rents equipment across the country to the farmers just like “Oxen”. It has a mobile app that helps the farmers to connect themselves with them if any issue occurs. 

4) Ninjacart: The founder of this start-up is Thirukumaran Nagarajan, Sharath Loganathan, and team. This supply chain technology. That can help to connect with retailers. It can serve the service provider with end-to-end operations.

According to Ninjacart, the supply chain moves 1400 tons of perishables. That is from farm to businesses, every day, in less than 12 hours. It is a process of agriculture venture capital India.

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Start-ups are Including all these new companies. There are many more start-ups that are highly growing in every part of India.

There is a venture capital firm, and it calls “Omnivore”. It has situated in India. It funds people or small businesses by building the future of agriculture and food systems. Over 20 pioneered agritech investing start-ups have been working since 2011.

Everyday Omnivore Partners portfolio companies transform food supply systems. That is to make farming more profitable and sustainable which can help people in upcoming years. The Omnivore team believes in one point.

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That “agritech entrepreneurs will lead the change. That will be into transforming agriculture towards resilience, nutrition.

Along with that, it will be profitable and sustainable field. Their goal is to give the platform a huge success. As per the report by Maple, Capital Advisor said Investments for venture capital firms. That is in agritech; start-ups had exceeded 500 million in its upcoming years as the companies engaged in helping farmers and enhancing farm mechanization.

 Agriculture Venture Capital Scheme India implemented by the Ministry of Agriculture and Farmers Welfare in India. That has stated that Venture Capital Assistance is financial support in the form of an interest-free loan provided by SFAC to implement projects for capital.

Some of Agritech Startups the benefits are:

  • Self Help Groups
  • Agripreneurs
  • Companies
  • Producer Groups
  • Partnerships
  • Farmers
  •  Groups for Agri based projects

Ankur Capital is a start-up VC (venture capital). All they do is an early-stage investing. It is a flexible capital suited. That is to create the most significant impact and are also looking for an innovative business model. They can address the core challenges across the sectors such as agritech, food, healthcare, financial and much more. They deploy between $500k to $5 million. They help their portfolio companies to raise additional capital from other investors. The benefits of Ankur portfolio company is that they connect you with experts. That is in producing and to energize efficiency.

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Some start-ups are moving forward to bring 4th farming-related advance technology for the betterment of the agricultural sector. Some agritech sectors help those needy farmers in a wide variety of services. That is from renting farm equipment at an affordable price to ensuring crop production—Lists of some Agritech start-up ideas which are engaging themselves into the agriculture family:

  • Oxen Farm Solution(2012): Which aims to increase India’s agricultural productivity by making the equipment cheap and affordable. The founder Vishwajeet Sinha stated that the company brings all the parties together in one platform like the farmers, The farming equipment manufacturers, and the government policies. And he also mentioned Mechanization as a huge problem the farmer faces across India. As the equipment is costly, so to address this problem Oxen decided to help the farmers rent the equipment at a low price. 

Oxen provide services like land preparations, management and much more. It uses satellite images to check up on the crops and harvesting status. As the founder mentioned, he uses IOT (Internet of Things) to fix any problems regarding high tech machines. It established in five Indian states – Chhattisgarh, Madhya Pradesh, Odisha, Punjab, and Uttar Pradesh.

  • Agribolo (2015):  In the field of Agriculture, Technology, Marketing and Finance Agribolo creates a unique solution for the entire agritech system through a mobile phone interface. Balaji Balaram is the founder of Agribolo and has engaged over 2.5 lakh farmers across India. It has few programs such as seed program, e-trading, rentals, Agrimart and free home delivery services.     
  • Crofarm (2016):   A supply chain start-up that buys fresh handpicked fruits and vegetables directly from the farmers. Then they distribute them to online and offline retailers. The founder of this start-up is Varun Khurana, and Prashant Jain The headquarter. It’s currently in Delhi. The supply chain operates in many states like UP, Haryana, and Delhi. The goal of this start-up is to minimize the menace of agents. Streamline processes in the agriculture sector which are unorganized.       
  • Stellapps (2011): Situated in Bengaluru, This start-up company has hands-on the dairy space and had a good run in 2018. The interesting fact about this start-up is that not only it raised funds, but it also investors like Bill and Melinda gates have invested in this start-up company. The founder Ranjith Mukunda and Venkatesh Seshasayee had done a great job by using the IoT and data analytics to embed the milking system, animal wearables.      
  •  CropIn (2010):   The farmers who have smartphones and internet connectivity and the companies can get updates of sowing, weather and pests through an app called “SmartFarm.” SmartFarm can analyze the weather and the land according to which it provides a plan to the farmer. Now CropIn started working with the Karnataka government as well as the Bihar and Madhya Pradesh governments to digitize farmer producer organizations.
  • Gramophone (2016): IIT Kharagpur graduates Nishant Vats, and Tauseef Khan made this one-stop solution for all kinds of inputs in farming. They added a toll-free number for the farmers so that they can give a missed call and can get all the desired solution to their problem regarding agriculture. 

They can also buy a specific type of agricultural products from the company’s e-commerce platform such as seeds, crop production, nutrition and much more.

The contribution to farming is 17% in India’s GDP. The govt and the start-up players have planned to improve and work on agriculture and exploring the Farming-as-a-Service (FaaS), which can bring out solutions. FaaS is a technique of making farming equipment or services more of understand and affordable process.

You need to subscribe or pay-as-per service, which is essential in the agriculture value chain. The total investors in India funding for Farming-as-a-Service (FaaS) market are around $105 million to $115 million. The reason behind investors investing that much amount of money is assurance and the return from the companies. Not only that the investors are an enthusiast, and those start-ups are gaining confidence and fame day by day.

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As to keep the supply chain function ongoing the agritech start-ups are helping the farmers to connect with the retailers. How? With the help of eCommerce selling the fresh products to the customers. Some start-ups, like AgriBazaar, Ninjacart, BigBasket, MeraKisan, making this process easier for the farmers and the retailers. 

      Here are some Agritech start-ups who are funding in this lockdown:

  •  DeHaat:  It is a Gurugram and Patna based agritech platform that raised funding of $12 million led by Sequoia Capital. AgFunder and Omnivore are also the existing investors in this Dehaat start-up. It is serving almost 210,000 farmers across Bihar, UP, Jharkhand and Odisha by providing 3,000 agricultural inputs. 
  •  Intello Labs: Gaining up to $5.9 million in funding by Saama Capital. Existing investors like Omnivore and Nexus Venture Partners did participate in the financing round. Milan Sharma, Cofounder and the CEO of Intello Labs, stated that the funding would help the start-up accelerate growth in international markets mainly in the USA and across the Asia Pacific.
  •  Bijak: Omnivore Partners and Tempo Ventures as being the existing investors has invested around $11.8 million. The founder Nukul Upadhye, Mahesh Jakhotia, Jitender Bedwal, Daya Rai are aiming to build the information asymmetry and lack of accountabilities to trade in agricultural activities. The app they mane provides several languages so that the farmers won’t have any problem in understanding. Bijak stood at $172 million as compared to the second week of the month. The two companies who funded $152 million are Razorpay and Zomato.

Mahindra and Mahindra company is taking a massive step by indulging themselves in farming. Mahindra is providing farming as a Service (FaaS), a new delivery model with progressive solutions, and affordable to the farmers. 

Mahindra innovated Agri technical in 2019 which showcases the farming solution by advance digital technology. 

 Dr Pawan Goenka, the Managing Director of Mahindra & Mahindra Ltd., Stated that “As potency and profit is the main issue in the farming culture. The technologies can provide a drastic change and transform to the farming and the farmers as well.” Mahindra is aiming to rise through the innovative mobile solution. By enhancing urban living, nurturing new businesses and fostering communities. They are giving access to hyperspectral imagery analytics. And artificial intelligence, machine learning and IOT to the Indian Center of Excellence (COE). 

We are looking forward to early-stage investors in India. As we know the value of some Agritech start-ups has become an eye-catching platform, for all the farmers. The venture investors headquarters in India provides data to their investment activities by raising fund. The report says the number of funding is around 23, and the total amount of funding is $177.2M. Dozens of start-ups are increasing day by day with their creativity. Focusing on supply chain and optimize output for farmers. Clover being the top start-up company. It appointed Mark Khan, managing partner of Omnivore. Vikram Suhas Godse managing partner at May field to its board of directors. 

And in this pandemic, the start-ups have brought limelight and more companies likely to raise more capital. With an increasing rate of investors in agritech, start-ups have encouraged to supply more fresh fruits, vegetables to hit the fear of Covid-19.

As per the report, there are 224 new associates in India. The companies in the travel and hospitality sectors have seen a decline in investment. So, early-stage investors in India are looking forward to investing in industries affected by Covid-19. Which also includes food delivery and remote work solution. In the upcoming times, they decided to make new investments based on the requirement in the fundraising. Summit Partners is one of the most top start-ups in 2020, which founded in 1984 and accelerated their growth and achieve dramatic results. They have invested in 500+ companies in technology, health care and much more.

Written by Srikanth

Passionate Tech Blogger on Emerging Technologies, which brings revolutionary changes to the People life.., Interested to explore latest Gadgets, Saas Programs

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