HYDERABAD: Agriculture start-ups, which were hitherto overlooked by investors, are finally emerging as a promising segment in the Indian start-up ecosystem. Springing up of several incubators focusing exclusively on agri start-ups, changing preferences of investors, initiatives taken up by government bodies like Indian Council of Agricultural Research (ICAR) and other developments are giving a fillip to agri start-ups.
“Increasing awareness among policy makers, financial planners and investors about the importance and potential of agriculture sector is helping agri start-ups to gain attention. Initially, the whole focus of incubators and investors was on startups related to IT and other allied sectors. Both start-ups and investors were chasing fancy valuations and glamour associated with start-up success stories. Mostly start-ups focused on copypaste models using IT, rather than getting on ground and trying to solve real problems of India. As a result, agri start-ups were neglected,” said Nagaraja Prakasam, who exclusively invests in social enterprises and acts as mentor-in-residence at IIM, Bangalore.
While the failure rate among start-ups focusing on IT, e-commerce and other sought-after segments was huge and the investors started getting an idea of the real picture over the past two to three years, several start-ups in agri space have slowly but steadily grown and succeeded, thus drawing attention of investors towards them. Prakasam, who has invested in successful agri start-ups like Lumiere Organic Store, Fresh World and others, stressed that ICAR’s direction to more than 100 research and development institutes under its purview to offer technology transfer to startups has helped agri start-ups.
Besides organisations like Acumen India and Villgro, initiatives of Central and several state governments is boosting the growth. Ministry of Agriculture has also launched Agriculture Grand Challenge.
“Agri start-ups have come a long way and have lot more support today. Initially, we got our seed funding from a-IDEA, an agri incubation centre, initiated by National Academy of Agricultural Research Management, Hyderabad. It was a small amount, but helped us in a big way to get investors at the later stage. But things have changed a lot now. Not only incubators and funds backed by government institutions, but also individual investors and private funds are opening up to agri start-ups,” said CS Jadhav, founder of Innerbeing Wellness Pvt Ltd.