Agritech startups Redefining Indian Agriculture

SHAILESH PALB9167 Sr. M.Sc.

Introduction

Second-largest agricultural land in the world

The agriculture and allied

sector employs 58% of our population

Core sector for food security, nutritional security, and sustainable development

There has been significant growth in Indian Agriculture with the grain production rising to 273.83 million tonnes in the year 2018

Technology then

Technology today impacts every aspect of agricultural value chain…

Processing & Storage

Inputs / Knowledge

Cultivation

Distribution, Packaging & Handling

• Getting agriculture inputs

• Weather forecast

• Decision support solution

• Pest management and nutritional management Solution

• AI based

sowing advisories

• Mobile

controlled motor

• Hi tech irrigation

systems • Auto steering

tractors • Crop counting

machines

• Machine-learning algorithms to differentiate between weeds and crops

• Machine based Image technology to sort based on color, size, type etc.

• Wireless sensor to monitor crops connected with smartphone

• Measuring grains moisture content

• Web and mobile

applications to sell farm products

• Price forecasting • Online

marketplace for grain

• Using data to

track a supply chain

To know the concept of startup and current scenario of agritech startups

To Understand the Bottlenecks for agritech startups in India

Case studies highlighting innovative agritech solutions

Objectives To know the Government support /incubators / accelerators related to agritech startups

Startup The Department of Industrial Policy and Promotion (DIPP) defines a startup as an entity established Not prior to ten years with annual turnover not exceeding INR 25 crore in any preceding financial years

Working towards innovation, development or improvement of products or processes or services, or if it is a scalable business model with a high potential of employment generation or wealth creation

Provided that such entity is not formed by splitting up, or reconstruction, of a business already in existence.

Startup development stages

Around 8,900-9,300 of these are technology led startups

1,300 new tech startups were born in 2019 alone implying there are 2-3 startups born every day

India has 3rd largest startup ecosystem in the world

India has about 50,000 startups in 2018

What is agri startup?

Start up in the field of Agriculture and its

allied sector is called as Agri Startup

Agri startups

• A total of 366 agri-based startups have come up from 2013 to 2017

• More than 50% of the startups in the last 5 years were started in 2015 and 2016

• 90%+ of all funding is focused on seed stage and early stage startups

-NASSCOM, 2018

What is agritech? Agritech is defined as an individual or

segment of companies using technology in the field of agriculture leading to increase in productivity, efficiency and output. Agritech can be applied across the agricultural

value chain and can be in the form of a product, a service or an application.

With Prime Minister’s aim of doubling farmers income by 2022, agriculture technology could be a major driving force to achieve this aim.

Key Indian states focusing on Agritech Startups

(2013-2017) State wise Funding

(2013-2017)

Startup scenario in India Agritech (2013 - 2017)

Karnataka 27%

Maharashtra 22%

NCT 9%

Haryana 9%

Tamil Nadu 8%

Telangana 7%

Gujarat 7%

Others 11%

Karnataka 67%

NCR 11%

Maharashtra 7%

Telangana 7%

Others 8%

Karnataka accounts for two-third of total funding received by startups

Karnataka and Maharashtra together account for almost 50% of the total

Agritech startups opened -NASSCOM, 2018

• ~ 450 agritech startups in India, growing at 25% YoY • Karnataka- Most innovative state for the second

time (NITI Ayog) • ~ 155 agritech startups in Bengaluru. • Bangalore has the third highest number of tech

startups among the global cities (Indian startup hub)

Agritech India Industry Summary

~35 startups established

in 2018 14 USD Mn

35 USD Mn

27 USD Mn

Top 5 Funded Startups (2018) 9

USD Mn

8 USD Mn

USD ~73mn funding

received in 2018

>70% of funding at Seed stage

>60% funding to market linkage

sector

USD ~248 mn funding received till June 2019 -NASSCOM, 2019

1

Agritech is make in India for the world

Every 9th Agritech startup in the world is from India.

48% Agritech CEOs believe to have next Agritech unicorn in coming 3 years

Global funds have directly invested in Agritech startups and sector focused funds. Multilaterals, such as, WEF and ADB have shown interest too.

<5 global Agritech companies ventured in India, as compared to >25 Indian Agritech companies with global presence.

Start-ups

Technology Unicorn

Funding Growth

Market exploration

Global India

1 0

2X 10X

3103 450

<5 ~25

Employment Rationalization

Streamlining Supply Chain

Stakeholder Empowerment

The Digital Infrastructure

Resource Maximization

Processing and Exports Solutions that enable farm

automation and aggregation will rationalize and gainfully redistribute the

workforce.

Mandis and FPOs need digitization to bring more transparency. Farmers need

more sales channels. Data and market connects can empower each stakeholder.

Post harvest loss in India amounts to USD 13 billion. Demand driven cold

chains, warehouse monitoring solutions and market linkage can significantly

increase farmer incomes

India ranks among top 5 countries in food processing. By 2024, the sector will employ 9 mn. Streamlining and tractability can improve farmer income and exports.

80% of India’s fresh water is used in agriculture. Similar figures for China are 65% and 70% globally. Reduction in usage of water and pesticides is a significant business opportunity.

There is an acute lack of data and insights at ground and farmer level. Along with laying the digital work, solutions that build a layer of data will transform DBT schemes, insurance and loan disbursal.

Untapped Agritech opportunity

1

Agritech Stakeholder Ecosystem

Government

Consumer

Agritech Start-ups

Industry Farmer Processing Market Linkage Input Harvest

Agritech path ahead

Market Linkage

Digital Agriculture

Better Access to Inputs

Farming as a Service

Financing

Taking quality inputs to the farmers for better Productivity

Making services affordable to small and marginal farmers

Driving transparency, traceability and real time access to information

Improving Supply Chain and taking farmers product directly to consumers

Innovations taking roots in farmer financing

Better Access to Inputs Providing farmers better

access to agricultural inputs at their doorsteps,

it helps farmers to understand the best

input product to increase the yield and productivity

Business Attractiveness

Landscape

Quality Fertilizers: 70% agriculture growth

depends on fertilizer quality

Offer door to door delivery, makes farmers more

interested in this business area

Access to Quality seeds: Quality of seed accounts

for 20%-25% of productivity

BigHaat

How it Works

Founded in

Founders

Headquarters

Product Name

Technology used

Inputs / Knowledge

2015

Sachin Nandwana and Sateesh Nukal

Bengaluru, Karnataka

Seeds, Plant Protection chemicals,

Plant Nutrients and Farm Machinery

e-Commerce Platform, Web and Mobile

Platform

Farming as a Service Farming as a Service

offers affordable technology solutions to

farmers for efficient farming by converting fixed cost to variable

cost Business Attractiveness

Landscape

A cyclic business model, as farmers need

equipments on regular basis

75% of farmers own less than 1 hectare of land

hence making it difficult to own equipment's

Buying agricultural equipments requires huge

money making it difficult for farmer

How it Works

Founded in

Founders

Headquarters

Product Name

Technology used

Inputs / Knowledge

2015

Abhilash Tirupathy and Karthik

Tamil Nadu and Karnataka

Equipment on Rental

Mobile based application

Gold Farm

Digital Agriculture Digital / Precision Agriculture based businesses offers

innovative technology solutions for increasing crop productivity and

farming process efficiency

Business Attractiveness

Landscape

Leads to data generation which can be used for

forecasting

Cost saving by offering better prediction

techniques

Tech Intervention

Drones, IoT Sensors, block chain, image sensing, analytics, machine

learning

Improve yield and increases productivity

Intello Labs

How it Works

Founded in

Founders

Headquarters

Product Name

Technology used

Inputs / Knowledge

2016

Milan Sharma, Nishant Mishra,

Devendra Chandani and Himani

Bengaluru, Karnataka

Intello Labs Grading App

AI (Smartphone based)

Market Linkage:Improving Supply Chain Market Linkage provides a digital

platform which connect farm output with the customer, it is

one of the most easy way to take farmers products directly to the

end customer

Business Attractiveness

Helps in reducing post harvest losses

Landscape

Huge customer traction

Received highest funding

Tech Intervention App based platform, image sensing

for quality grading, IoT based storage monitoring

Directly taking farm output to consumer

WayCool

How it Works

Founded in

Founders

Headquarters

Product Name

Technology used

Inputs / Knowledge

2015

Karthik Jayaraman & Sanjay Dasari

Chennai

Waycool foods and products

B2B & B2B2C e-commerce platform,

mobile platform

How it Works

B2B2C model

Financing Farmers in India struggle

to get finance but Agritech based financing

start-ups helps such under served community of farmers to get loans

quickly Business Attractiveness

Landscape

A solution for millions, hence scalable

Farmers do not have good credit history which makes it

difficult for them to raise funds through traditional channels

Raising funds, the biggest challenge of Indian farmers

How it Works

Founded in

Founders

Headquarters

Product Name

Technology used

Inputs / Knowledge

2016

Alekh Sangera, Mehtab and Lokesh

Uttar Pradesh

Low cost digital loans

Mobile Technologies

farMart

Government Support / Incubators / Accelerators

Government announced a four point strategy to support agriculture in India…

Reducing Cultivation Costs Ensuring

Profitable Prices

Processing Farm Wastes

Creating non farm source of Income

Apart from four point strategy GOI have specifically focused on support start-ups in this area through

start-up India

Through this initiative, the government aims to empower start-ups to grow through innovation and design. The Startup India initiative is based on the following three pillars: •Simplification and handholding

•Funding support and incentives

•Industry-academia partnership and incubation

Launched by the Indian government to set up a network of

technology centres, incubation centres and also to promote start-ups for innovation and

entrepreneurship in rural and agriculture-based industry

The NSTEDB start-up scheme by Indian government

will provide a limited, one-time,non-recurring financial

assistance, up to a maximum of INR 25 Lakhs.

There is no upper limit (or even lower limit) for a project grant. The budget is decided based on the requirement for its successful implementation.

Provided support for project staff salaries, equipment, supplies and consumables, contingency expenditure, Patent filing charges, outsourcing charges, etc.

AIM will provide a grant-in-aid of INR 10 Cr to each Atal Incubation Centre for a maximum of five years to cover the capital and operational expenditure cost in running the centre.

Incentive schemes to support start-ups in agriculture and technology…

The quantum of SFAC Venture Capital Assistance

will depend on the project cost and will be the lowest

of the following: >26% of the promoter’s equity and

>INR 50 Lakhs.

RKVY- RAFTAAR Rashtriya Krishi Vikas Yojana- Remunerative approaches for Agriculture and Allies sector rejuvenation

Pradhan Mantri MUDRA Yojana

Pradhan Mantri MUDRA Yojana (PMMY) is a scheme launched by the Hon’ble Prime Minister on April 8, 2015 for providing loans up to 10 lakh to the non-corporate, non-farm small/micro enterprises.

Agriculture grand challenge •A unique opportunity for Agri-tech startups with a commercially viable solution to solve for innovative challenges in the sector. • Ministry of Agriculture, Govt. of India is looking for new concepts & innovations in 12 different areas. •Twelve startups from each of the early stage, and ready-market stages (24 in total) would be selected to address the 12 themes (key problems) at the programme.

Karnataka is one of the few States that launched their Startup policy very early (in 2015) in the country

KEY HIGHLIGHTS

OF THE ACTIVITIES

startup.karnataka.gov.in

Key Agritech focused Incubators and Accelerators

IIM Ahmedabad has launched India’s first Food & Agri-Business accelerator(CIIE) for

start-ups in food and agri-business sector

ICRISAT launched Innovation Hub (iHub) to support agricultural tech entrepreneurs, scientists and technology experts

Indigram Labs Foundation (supporting high end start-ups)

NAARM launched a-IDEA which is a Technology Business

Incubator(TBI). NAARM launched Agri Udaan, Food & Agribusiness

Accelerator

Other Incubators and Accelerators focused on Agritech

- IIM Calcutta Innovation

Park

SIDBI Innovation &

Incubation Centre (SIIC)

Tamil Nadu Agricultural University /Agricultural

College and Research Institute

(ACRI)

NASSCOM Centre of

Excellence for IoT

UPAYA Social Ventures

Kalinga Institute of Industrial Technology

Business Incubator (KIIT-TBI)

start-up Oasis (Jaipur Based

Incubation Centre)

Other Incubators focused on agri startups

ICAR agri- business incubators PUSA krishi incubator (ICAR-IARI) CrAdLE (Centre for Advancing & Launching

Enterprises ) EDII Ahmedabad N S Raghavan Centre for Entrepreneurial Learning

(NSRCEL) at IIM Bangalore. C- CAMP (Centre for Cellular and Molecular

Platforms) UAS Bangalore.

News Reports

Bottlenecks for Indian Agritech startups

Low Landholding Size

Return for the Investors

Talent Retention

Long Gestation Period

Technology Affordability

Skill Adaptability

Acquisition of Agritech Companies Government Regulations and Policies

19% More than 5 years

5 years 33%

3 years 43%

5%

More than 50% Agritech CEO’s do not expect an Indian Agritech

unicorn within the next 5 years

Farmers’ Mindset

39% 29% 20% 12%

Policy

~40% of Agritech founders feel that raising funds is the biggest challenge

….To an Indian Agritech Unicorn

Key Challenges for Indian Agritech Firms

1 years

NASSCOM Agritech CEO Survey 2019

Lack of Digital Infrastructure

Funding

Recommendations Increased and timely support to early stage start-ups

Need for large companies to collaborate with start-ups

Need for Corporate and Government accelerators to help Agritech start-ups grow to the next level. v

There is a need to create mobile trainings to educate the farmers

There is a need for Government to help set up Agritech focused incubators and grants. Academia should encourage more entrepreneurs to focus on this growing

sector and curriculum changes to be made in agricultural universities

Agritech Case Studies

Revolutionizing the Fresh Produce Supply Chain

India's largest fresh produce supply chain company

Founded in

Headquarters

Objective

Product Name

Technology used

2015

Bengaluru, Karnataka

To provide more income to farmers

and less price to retailers by creating

an efficient supply chain

Ninjacart Mobile App

B2B e-Commerce platform, Mobile

platform

Core Team Profile

How it works

Active regions

Impact

Funding

Operationally present in 7 cities- Bengaluru, Delhi, Pune,

Ahmedabad, Chennai, Mumbai, Hyderabad

20,000 farmers, serves over 70,000 customers every month,

movement of 1400 tonnes of perishables from farms to

businesses, every day, in less than 12 hours.

$34.6 Mn (INR 250 Cr)

Company had a revenue of INR

27cr. in 2016-17, INR 54cr. in 2017-18

and INR 132cr. in 2018-19.

The revenue grew at a rate of 388%

between 2016 and 2019

Founded in

Founders

Headquarters

Product Name

Technology used

Other services

2019

Havyas K. S. & Nithin Singh

Bengaluru, Karnataka

Precision farming as a Service

NDVI sensors, Drones

Hydroponics (home kit and outdoor setup) Hydroponics Training, Consultation

Transforming the Future of Farming

We are solving the problem of excess use of fertilizer

and pesticide in farming as well as poor management

of other resources throughout the agricultural process, labor issues as

well as non-standard method of farming

activities.

Research Studies

Entrepreneurial India: How startups redefine India’s economic growth

Mehrotra, N et al., (2016)

Leaders of established companies identify the

benefits of collaborating with startups

major reasons for failure of startups as identified by Venture capitalists

Conclusion • Over all, the ecosystem for agritech startup in the country is

promising

• Government is also playing its part in boosting innovation and entrepreneurship

• Several incubators and accelerators are actively increasing their footprints

• Never the less several factors remain to be addressed towards

further enabling agritech ecosystem and unleashing the full

power of available technological innovations

towards improving India's

agriculture growth

THANK YOU