Thursday, June 20, 2024

Tech transformation: how agriculture is being redefined through digital innovation and startups

At a recent YES Bank panel and digital startup competition, it was evident that India’s digital boom was lending the Indian startup ecosystem a distinctly agri-flavour.

The convergence of mobile networks, broadband internet, cloud platforms, IoT, AI and open data is helping transform one of the world’s oldest professions. This is of great significance as agriculture and related sectors like dairy production form the backbone of the Indian workforce. Today, tradition is merging with technology as the IT services sector is helping open up new opportunities for both seasoned and emerging entrepreneurs.

New fronts are opening up across the sector from organic farming and hydroponics to drones and agri apps. Startups are also playing a key role in transforming agriculture, which accounts for half of India’s workforce, but only about 13 percent of its GDP.

Entrepreneurship trends
An interesting trend to watch for is the rise of the number of agri-entrepreneurs, many of whom have no background in agriculture. There is more interest now in this sector compared to even five or ten years ago. Another indicator is the number of agri-tech competitions, awards and investors that are emerging. India’s demographic dividend is also attracting more youth segments to the agricultural sector, with cross-fertilisation across states, economic sectors, and scientific fields.

The challenges seem formidable, but need to be acknowledged and tackled. Thousands of farmers commit suicide each year due to debt problems, as documented by the National Crime Records Bureau (NCRB). This is a sad reality in states such as Maharashtra, Odisha, Gujarat, Uttar Pradesh, Karnataka, Punjab, Madhya Pradesh, Chhattisgarh, and others.

Many issues being tackled by startups relate to productivity and distribution, according to Sahil Kini, Vice President, Aspada Investment. There are large yield gaps in Indian farming as compared to its global counterparts, due to inadequacies in domains ranging from farm inputs and equipment to farming practices and retail connects. Multiple intermediaries, poor refrigeration during transportation, small farm sizes, and lack of fairness in financial stakeholders are other challenges.

Agri-tech startups
Today, the agri-tech sector is witnessing a number of startups in India disrupting everything from organic farming and equipment rentals to connected supply chains and cloud-based analytics. The startups in this report showcase the diversity in the sector, followed by an analysis of the broader ecosystem. Some cover pricing of produce, others include equipment marketplaces; still others cover digital workflow and smart supply chains.

Farms2Fork offers farmers water monitoring solutions that ensure better productivity by reducing water wastage. The solution includes IoT wireless soil sensors, AI support, and real-time analytics. While earlier agri-tech solutions were based on batch processing of data, Farms2Fork operates on real-time data.

Agribolo, founded in 2015, is a farming services platform spanning activities such as information dissemination, quality input procurement, market linkages, irrigation facilities and farming equipment. The franchise network, launched in Rajasthan, uses the aggregator model to connect farmers to experts, development institutions, financial services, and training institutes.

AgroWave, founded by an IIT Delhi alumna in 2017, aims to optimise agriculture supply chain using research, analytics, and technology. Demand and supply analytics connect farmers in Panipat, Sonipat, Harpur, and Rajasthan to caterers, retail shops, restaurants, and canteens.

Truce, founded by an IIT Bombay alumnus, is a B2B web and mobile platform that directly connects farmers and suppliers to wholesalers and retailers. The app is available in Hindi, English, Marathi and Gujarati, and enables tracking quotes and orders.

Farm Again has converted 2,500 acres of land into organic farms, along with tech tools to trace the product’s origin, when sold in outlets such as Reliance Retail, Big Bazaar, and More. IoT devices are used to monitor and record moisture content and soil conditions, with pipes for water and fertiliser inputs.

Crofarm, a Delhi-headquarted agri-supply chain startup founded in 2016, buys fresh produce directly from farmers and supplies them to online and offline retailers. It supplies nearly 8-10 tonnes of fruits and vegetables from its two distribution centres in Delhi NCR, and connects 100 retailers to more than 5,000 farmers.

Aibono improves farm yields by using AI on a cluster of parameters like weather and soil condition. The testing and measurement services indicate parameters such as crop stress, along with recommendations on the right fertiliser mix to be used based on the soil condition.

Gold Farm, founded in 2012, helps farmers book farm equipment such as solar-powered pumps in districts of Karnataka and Tamil Nadu. Beneficiaries have included over 25,000 farmers on ground, who tap the services of 250 booking agents and over 500 tractor owners connected via a mobile app. The equipment is also tracked with IoT devices, resulting in rich data sets for analysis and forecasting.

Earthy Tales, founded in NCR in 2016, works with farmers across 11 states to provide chemical-free fruits, vegetables, groceries, and dairy products. These include snacks, jams, preserves, and pickles, provided direct to consumers. Other services include mentoring for farmers and farm cooperatives.

ONganic Foods works with small farmers to boost their organic produce. Based on contract farming, it identifies higher-priced grains and spices and gives quality inputs to farmers to increase their yield. It connects farmers to various government schemes as well as e-commerce platforms such as Amazon and Spencer’s Retail.

Oxen Farm Solutions offers agricultural equipment on rent using a ‘Farming as a Service’ (FaaS) model. The platform connects farmers, farm equipment manufacturers, and government schemes. Access to such machinery can boost farm productivity in an affordable manner. The company operates in Punjab, Madhya Pradesh, Uttar Pradesh, Chhattisgarh, and Odisha, and connects to corporates such as PepsiCo and Yes Bank.

Farmizen is a mobile-based platform that lets users grow vegetables and fruits on mini-farms, and monitor the process of growing food on a real-time basis. Located in the outskirts of Bengaluru, users get pictures and live videos of their farm plots. The startup also provides recommendations based on real-time inputs from the field as well as pre-defined schedules for over 50 different types of crops.

Harvesting, founded by in 2016, has offices in California and Bengaluru, and offers smart farming solutions based on analytics and AI. It also uses farmer profiles to build creditworthiness profiles for financial organisations. The idea is to provide both increased farm productivity and better financial services.

SatSure uses IoT and Big Data to provide financial security to farmers, via its 15-year database of satellite images. It makes recommendations clustering techniques for farmers to get an estimate of the total agriculture production, and provides this data to agri-insurance companies as well.

Organic Thelawala enables a transparent pricing mechanism so that the consumer knows the price of the produce as well as how much of the selling price actually goes to the farmer. It is s assisting 13,000 farmers to switch to organic farming, thereby, creating a positive impact on bio-diversity, soil contamination, water, and air pollution. Further, by providing free thelas (pushcart), the team promotes micro-entrepreneurship among pushcart vendors and farmers.

Earth Food, based in Pune, provides chemical-free produce at market price. It has collaborated with Reliance Fresh and Nature Fresh.  It uses a healthy mix of traditional methods and innovation to keep pollution and wastage to a minimum, thereby benefitting both consumers and the environment.

Jayalaxmi Agrotech, founded by alumni of IIMB and VEC helps farmers minimise crop loss and improve productivity via its many crop- specific mobile applications in local languages that provide timely information on agriculture and animal husbandry.

Gramophone, based in Indore, is a platform that combines both advisory and sale of inputs under a single roof. Farmers can access mentors for help with everything from crop selection to land productivity and more.

Triton Foodworks, based in Delhi, is a hydroponics startup growing fruits and vegetables. It has reportedly set up more than 2 lakh sq ft of hydroponic farms across three locations in India, and produces more than 700 tons of fruits and vegetables each year.

vDrone, based in Bengaluru, uses drones and thermal imaging to increase yield. It analyses areas of the farm that need attention, and helps the farmer cater to these needs. Parameters include soil, cropping pattern, and use of fertilisers.

Ninjacart, based in Bengaluru, enables retailers and merchants to source fruits and vegetables directly from farmers without resorting to middlemen. It connects 2,500 farmers and handles 14,000 tons of fruits and vegetables, accounting for revenue of around Rs 4 crore every month.

BigHaat, based in Bengaluru, is an online agro e-store for farmers that lets them buy seeds, crop protection nutrients and solutions, and agro instruments. Last-mile connectivity is enabled via logistics partners like India Post and Ship Rocket. The footprint spans 50,000 farmers across 20 states.

Ravgo is an agri-equipment rental marketplace based on the model of the sharing economy. It is solving the farm mechanisation problem among India farmers who cannot afford to buy the farm machinery. The target market is currently small farmers based in Punjab.

Kisanmade, launched in Moradabad, UP is an e-commerce platform set up in Moradabad to empower farmers by eliminating the intermediary between the farmer and the consumer. It also aims to increase the farmer’s income and decrease the kitchen’s expense by 10-15 percent.

FlyBird Innovations, founded in Bengaluru, uses sensors in the soil to detect moisture content and control irrigation in farms across South India. The information is used to optimise irrigation practices, improve crop yield, and save water, time, and labour. It claims 25-30 percent savings of water and improvement of crop yield by 10-15 percent.

Kamal Kisan reduces labour costs with innovative agri-equipment, with reported savings of up to 50 percent. Tools include sugarcane planters, versatile mulch layers, bed makers, vegetable handy planters, and power weeders.

farMart connects farmers who own machinery with those who need it but don’t have access to it. Large farmers put underutilised agri-machinery up for rent on the farMart platform, and are connected to farmers who need such machinery; they can then book it via app or call centre. The database includes 300 villages and 1,500 farmers.

AgroStar, a Pune-based m-commerce startup, sells agricultural inputs directly to farmers. The platform can be accessed online or giving the company’s 1800 number a missed call. Products are sourced from national and multinational brands, and include seeds and nutrients.

CropIn leverages GIS and data science to deliver a range of services apps to farmers and other players in the agri chain. It feeds real-time data and advice on practices related to a range of crops.

Other notable agri startups are NubeSol (soil fertility maps) and Sree Sai Aerotech Innovations (drones for monitoring crop health). Some industry players are also leveraging the platform model – such as Trringo, launched in 2016 by India’s largest tractor maker company, Mahindra and Mahindra. The franchisee network enables farmers to access tractors at an affordable price. Over 100,000 farmers have signed up, from West and South India.

There are also international players in the Indian agri market, such as PEAT. The German startup is working with 30,000 farmers across India to help mitigate crop damage. It identifies patterns of plant diseases, pests, or nutrient deficiencies via crop images.

The broader agri startup ecosystem includes a number of think tanks, research labs, incubators and accelerators. For example, ONganic is supported by the Technology Development Board, Government of India and Ministry of Small and Medium Enterprise and incubated at the Indian Institute of Management, Kolkata.

Goa has an agri-focused incubator called Centre for Innovation and Business Acceleration (CIBA). TiE Bangalore and NUMA have held startup showcases in collaboration with Villgro, featuring agri-entrepreneurs.

At the recent YES Bank Transformation Series (YBTS) speakers and panelists included Ramanathan Ramanan, Mission Director, Atal Innovation Mission, NITI Aayog; Raju Kapoor, Head, Corporate Affairs, Dow AgroSciences India; Hemendra Mathur, Venture Partner, Bharat Innovations; Nitin Puri, Senior President, Food and Agribusiness Strategic Advisory and Research, YES Bank; and Amardeep Sibia, CEO, SatSure.

At the 2017 edition of YBTS three agri-tech winners were awarded out of 15 finalists. Winners included teams from IIM Shillong (Rs 5 lakh for a smart soil sensor proposal), IIM Bangalore (Rs 3 lakh for a solar-powered drip technology proposal), and ISB Hyderabad (Rs 2 lakh for IoT-based SIM-enabled farm data sensors).

The Government of India is also catalysing agri- entrepreneurship with programmes like the Agri-Udaan Accelerator and the Agri Grand Challenge. Government-backed funding agencies like the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) is incentivising banks to lend at highly affordable rates to startups.

Incubators in this space include Villgro, a-IDEA, ABI-ICRISAT, Startup Oasis, IIMC Innovation Park, IIT Kanpur SIIC, KIIT TBI, and CIIE, IIMA. They provide mentorship and connects to farmer cooperatives, NGOs, channel partners, and individual farmers in some cases.

Indigram Labs Foundation (ILF), supported by Department of Science and Technology via the National Science and Technology Entrepreneurship Development Board, Government of India, is a technology-based incubator founded in 2015 to promote creativity and innovation in agriculture, renewable energy, and rural healthcare industry. Its host organisation is Indian Society of Agribusiness Professionals (ISAP).

ISAP has set up more than 1,800 agri-based ventures through its Agri-Clinics and Agri-Business Centres (ACABC) programme and has around 50 agri-business experts in various verticals who help in mentoring incubates, according to Manisha Acharya, CEO, Indigram Labs Foundation.

It has graduated 18 startups, such as New Leaf Dynamic Technologies(refrigeration system powered by farm waste), Intello Labs (AI-based deep-tech solution for crop inspection and agricultural products grading), Sainhun Ventures(honey by-products), Nutrelis Agro Foods (organic groceries, beverages), and Innosapiens Agro Technologies (phenomics device for pre-detection of pests).

Indigram takes an equity of up to 5 percent in the startup. In the long run, agri incubators need support in areas like trained manpower, pilot testing costs, rural outreach, and patent advisory services, according to Acharya.

 International Crops Research Institute for Semi-Arid Tropics (ICRISAT) hosted an agri-business investors camp in Hyderabad on June 12. The camp addressed three themes: agri-technology, agri-engineering and food processing.

IIM Ahmedabad’s technology business incubator, Centre for Innovation Incubation and Entrepreneurship (CIIE), has launched a food and agri-business accelerator in partnership with a-IDEA, the business incubator at Indian Council of Agricultural Research’s (ICAR) National Academy of Agricultural Research Management (NAARM). Top teams are provided seed investment of up to Rs 30 lakhs each. CIIE also has a sustainability focused fund called Infuse Ventures.

Recent reports have tracked the investment line-up for Agricx Lab (Ankur Capital, CIIE), Agrostar (IDG Ventures, Aavishkaar Venture Management), Agrowave (Daffodil Software), Airwood (StartupXseed Ventures), Arya Collateral (Aspada), Farm Taaza (Epsilon Venture Partners), Farmizen (Venture Highway), FarmLink (Pioneering Ventures, Syngenta), Gobasco (Matrix Partners India), KisanHub (Notion Capital, IQ Capital, Calibrate Management), KrishiHub (INVENT accelerator, Villgro Innovation Fund), NinjaCart (Trifecta Ventures), RML AgTech (IvyCap Ventures), Utkal Tubers (CapAleph Indian Millennium SME Fund, Zephyr Peacock India), and VillFarm (Unitus Seed Fund, Rianta Capital).

Crofarm has received funding from angels such as Rajan Anandan (MD, Google India) and Jitendra Gupta (MD, PayU India). Gold Farm raised funds from Infuse Venture and the Mahindra Group. Truce was funded by 3one4capital, Beenext, FreeCharge founders, Snapdeal founders and Anupam Mittal, CEO, People Group. CropIn, raised funds from Ankur Capital; Agrostar received investments from Aavishkar. Other active agri-focused funds include Omnivore Partners and Rural Agri Ventures; Germany development agency GIZ has also roped in international partners for further cooperation.

Among Indian states, Karnataka formalised an agri-startup fund in 2017 through K-BITS with a corpus of Rs 10 crore, with an additional Rs 8 crore planned for 21 agri-startups this year. A centre of excellence for agriculture is also planned, where startups will work with farmers.

Other government initiatives, according to Sahil Kini of Aspada Investment include Agricultural Debt Waiver and Debt Relief Scheme, 2008; and Money Lending (Regulation) Act, 2008.

Entrepreneur tips
A number of mentor panels and pitch jurors have offered guidance for agri-entrepreneurs. These include, for example, the importance of customer immersion. Here are some of the tips they have shared.

On-the-ground realities in emerging economies are shifting rapidly, and founders should have a finger on the pulse of effective trends and aspirations.
Disciplines like design thinking offer useful and actionable frameworks.
Metrics should be holistic and include activity, business, and social impacts. There should be one or two key success metrics for primary focus, and the rest should be supporting or complementary metrics. This helps founders monitor their progress and assists investors in assessing the long-term viability of the venture.
Founders should build a well-rounded team, with a mix of engineering, design, and social science backgrounds. Sometimes founders get too carried away with the technology; having a holistic mix in the core team will help contextualise the offerings, use and impact.
India’s social problems call for bold and ambitious innovators who can tackle challenges at scale. The social cost of failure is high for social enterprises (as compared to merely pivoting an app design); hence collaborative partnerships are important.
Social entrepreneurs should learn how to work with partners who are not social enterprises. They should be clear about their offerings, values, and philosophy. Partnerships are an art and a science. Partners should be picked carefully, and the relationship should evolve over time.
Founders will frequently need to pitch to funders, investors, partners, regulators, customers, and employees. The pitch should focus less on product features and more on problem resolution. Techniques like storytelling are effective here.
Founders should enumerate the range of risks involved, eg. regulatory and lack of ecosystem trust. Secondary impacts should also be assessed, since some risks are more indirect than others.
The road ahead
This is a great time to integrate different domains of knowledge and skills in agri-innovation. In addition to fresh farm produce, there are lucrative opportunities in processed products such as pickles, papads, chutneys, and murabbas. This calls for effective post-harvest management infrastructure such as storage, preservation, cold chain and refrigerated transportation.

New models such as the FaaS model can lead to more sustainable paths to profitability. The platform model can leverage data analytics to identify emerging business trends and opportunities and thus attract more venture capital, according to a report published by Bain and Company in partnership with Indian Institute of Management, Ahmedabad. Such models are also getting significant corporate backing, such as Trringo by Mahindra and Mahindra for tractor rentals and John Deere (with EM3 Agri Services) for harvester fleets.

Smartphones powered by affordable mobile broadband networks are helping improve workflow of farms and dairies. This opens the door to new pay-per-use business models and innovation stacks, connecting the farm to the fridge and fork. Banks and financial organisations also need to step up to the challenge and offer more creative models of financing for farmers, entrepreneurs, incubators, and accelerators.

Prime Minister Narendra Modi has announced a target for farmers’ incomes to be doubled by 2022, India’s 75th year of Independence. Schemes like the government’s Startup Agri India scheme, the Digi Gaon (Digital Village) initiative, and Bharat Net project can all work together towards making this a reality. Initiatives like agri-hackathons can also bring together aspiring entrepreneurs from diverse sectors.

However, there are certain challenges:
Pricing decisions should be made more transparent and less politically driven (particularly before elections), with sufficient market validity and testing. This includes setting the price of onions and sugar, and promising ‘free’ electricity for farmers.
Increased promotion and adoption of open data are other trends to watch for. An open data ecosystem can grow India’s GDP by $22 billion by 2020, according to report by YES Bank and the Ministry of Electronics and Information Technology (MeitY). India’s Open Government Data (OGD) platform can step up to this challenge.
The Centre for Internet and Society (CIS) is pushing for these initiatives to reach ordinary people and marginalised communities. Other sources of data include rural internet kiosks, community e-centres, and online agricultural systems.
Agri-tech entrepreneurs can go beyond incremental change to truly effect exponential change, and transform the agricultural sector while also giving back to society. Successful agri-preneurs in India can also take their innovations global.
The agricultural sector is now shedding its rustic persona to emerge as a trendy space to be in. Inclusive, sustainable, and scalable solutions are the way ahead.


  • AgriTech
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