December 19, 2023

By Lynda Kiernan-Stone, Global AgInvesting Media

India is a top global producer of many agricultural products, ranking second in fruit and vegetable production only to China, producing 102.48 metric tons of fruit and 200.45 metric tons of vegetables according to the Ministry of Commerce & Industry, Government of India. It also is a young, high-energy country with 74 percent of its population being younger than 45 years. 

However, due to fragmentation and inefficiencies throughout the country’s supply chain, the UN FAO estimates that approximately 40 percent of the food produced in India is wasted, representing a GDP depletion of about 1 percent, according to India’s Ministry of Agriculture.

Globally, between 2020-2027, the agritech industry is projected to grow at a CAGR of 12.1 percent and amid the top countries churning out innovations such as the U.S. and China, there’s India rapidly gaining ground on the world stage. 

Agriculture in India is the main livelihood for nearly 40 percent of the country’s population, accounting for just under 20 percent of the country’s GDP in FY2021. However, there are seemingly built-in hindrances to growth and development for ag in India – a situation that agtech is quickly addressing.

One player is Vegrow, India’s leading B2B fruits marketplace, that announced it has raised $46 million in Series C funding led by Singapore’s sovereign wealth fund GIC, with significant participation from existing investor Prosus Ventures and support from Matrix Partners India, Elevation Capital, and Lightspeed.

As the first investor in the company, Matrix Partners India has been witness to its maturation from concept phase to a leader in the $50 billion fruit segment. Vegrow stated that its advantage lies in the depth of its multi-channel demand stack and its leveraging of technology for demand-supply matchmaking. 

“Vegrow is the fastest agri-tech company to build a national presence, having done this within three years of its inception. Typically, it takes double the time to achieve this scale of operations,” said Praneeth Kumar, co-founder, Vegrow.

Through its platform, Vegrow is able to maximize farmers’ income by accurately grading produce and efficiency matching it with the most suitable demand channel, creating what it calls a virtuous cycle, attracting more farmers through competitive pricing and more buyers through consistency in both quality and pricing. 

“The company’s strategy marks a significant advancement in the efficiency and reliability of the fruit ecosystem,” said Kumar. “Over the past year, Vegrow has experienced a remarkable fivefold increase in revenue and achieved operational profitability.”

“At Vegrow, we distinguish ourselves from conventional operations, by creating an organizational ethos centered on agility and experimentation,” added Mrudhukar Batchu, co-founder, Vegrow. “Through the extensive utilization of data and technology, we provide valuable insights and optimize supply chain challenges, such as reducing perishable inventory wastage to only one-fourth of industry average, and consistently achieving industry-leading profit margins.”

For GIC, this investment in Vegrow is its first agri-tech and B2B commitment in India. The company noted that Vegrow’s ability to leverage technology to create win-win outcomes for all stakeholders in the value chain, along with its founders’ extensive experience in the sector, and the company’s demonstrated execution differentiates them from their field of rivals, are all factors making GIC look forward to partnering with the company in the next phase of growth. 

Much the same, Matrix Partners noted the founding team’s expertise, systemic problem-solving approach, and the use of technology to minimize inefficiencies and waste as key to Vegrow’s success. Vegrow’s strategy has not only established a sustainable economic model, but has led to increased incomes for every participant in the supply chain, and as the company continues to thrive, Matrix Partners India has consistently increased its backing through every funding round.

Likewise, Elevation Capital and Lightspeed highlighted how Vegrow’s implementation of technology has not only improved the lives of India’s farmers, but has, through its strong, national presence and sustainable model driven efficiency and scale while continually adding value for all stakeholders.
“Vegrow is committed to making a positive impact for both farmers and the planet,” said Shobhit Jain, co-founder, Vegrow. “Our ambition is to establish ourselves as the undisputed leader in every fruit category, ensuring transparency and higher income for farmers, while also reducing carbon consumption through supply chain optimization.”

“We are excited to work with GIC, whose long-term vision and reputed global network can contribute to building a company that will last generations,” continued Jain. “We are also grateful for the continued support from our existing investors. As we focus on long-term institutional development and enhancing value for all stakeholders, we are excited for what the future holds.”

~ Lynda Kiernan-Stone is editor in chief with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Unconventional Ag. She can be reached at lkiernan-stone@globalaginvesting.com.

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