Indian agriculture-tech start-ups have turned out to be the darling of investors in recent times, with the sector receiving more than USD 248 million in funding over the first six months of this year, registering a whopping 300 per cent growth compared to the same period last year.
With numbers growing at the rate of 25 per cent year-on-year, India currently has more than 450 start-ups in the agritech sector, according to a report unveiled by NASSCOM. “Over recent years, the sector in India has witnessed some of the global and sector-focused funds directly investing in agritech start-ups,” said the report, titled ‘Agritech in India: Emerging Trends in 2019’.
According to a survey by the IT industry body, 48 per cent of agritech CEOs who responded believe they will be the next agritech unicorn in the coming three years. With more and more farmers accepting and adopting innovative start-up solutions, there has been a considerable shift in the segment from B2C (consumer-facing) to B2B (business-facing) start-ups.
“The agriculture sector is advancing steadily towards its digital transformation and the start-up ecosystem is playing a critical role here, bringing innovation and disruption in much-needed area,” said Debjani Ghosh, president NASSCOM. The adoption of technology in agriculture has always needed a structured institutional focus and technology firms are trying to break into the agricultural landscape using newer business models, Ghosh noted.
“IITians and NITians are taking interest in agritech sector as it remained untouched and also due to Internet of Things (IoT) application. As basic IoT applications can help farmers to control irrigation system, and monitor soil quality, and productivity. As huge benefit can be derived out of such things, students are taking interest and trying to raise funds,” Saurabh Chaubey, CEO AIC@36Inc told this publication.
“Farmers are now making the most of digital avenues provided to them with the rise of smartphone penetration and easy availability of data at cheaper rates. With the underlying infra of 4G internet reaching almost all nooks and corners of the country, scaling business models has now become easier,” Ashish Mishra, CEO, TheKrishi, an Agra-based start-up, told this publication
“There are a lot of investors who are taking a note of the underlying growth opportunities coupled with macro trends and are willing to invest specifically in agritech sector in India. Investors feel Indian firms in the sector have the potential to go global,” he added.
Meanwhile, data from research firm Tracxn also shows that the sector has crossed $100 million in investments during the first seven months of 2019, compared to USD 163 million over the whole of 2018.
Nasscom also noted that corporates and investors are playing a vital role in supporting this shift from B2C to B2B start-ups with over $200 million investment in B2B start-ups made over the past 18 months, making it as a key revenue generating segments in the overall agritech sector. This has enabled creating better access to market, faster technology adoption and bring domain specific product development support to the industry, it added.