Epsilon Venture Partners Leads $8M Series A for Indian Agtech Company Farm Taaza
October 6, 2017
Indian fresh produce supply chain management and business-to-business (B2B) agtech platform Farm Taaza Produce Pvt. Ltd has raised an $8 million Series A led by Hong Kong-based Epsilon Venture Partners, and Tara Indian Fund IV.
Founded by Silicon Valley veterans in Bengaluru, Farm Taaza is a wholly-owned subsidiary of Gram Suchana Solutions and is a B2B focused on improving value for both farmers and their business customers. The fruit and vegetable market in South India is worth more than $3 billion, but between 30 and 40 percent of fresh fruits and vegetables grown in India are lost due to spoilage due to highly disorganized supply chains with too many middle-men, according to the company. Farm Taaza is working to streamline these supply chains – informing farmers exactly what is needed based on demand, and therefore, allowing farmers to grow and sell their entire crop.
The capital from this round will be used by the company to fund upgrades to their tech platform, and to expand their reach across south India – building upon the company’s acquisition of Kaivalya Farms and Farm Exotica last year.
Currently Farm Taaza engages with more than 1,400 farmers and supplies about 20 tons of produce per day to clients including hospitals and hotels.
“We want to enable a seamless supply chain from farm to store and our next focus will be to leverage machine learning, AI and data analytics for improved decision making,” Kumar Ramachandran, CEO of Farm Taaza, told Deal Street Asia.
Epsilon Venture Partners was founded in 2015 by former managing director, India and Asia Pacific for Intel Capital, Sudheer Kuppam, and recently achieved its first close of its $350 million fund in March 2017, with expectations of a final close in early 2018.
Epsilon has plans to invest one third of its fund in Indian tech-focused companies, with the remaining two thirds to be dedicated to companies operating in North and Southeast Asia. The maiden fund’s portfolio currently consists of four companies including Farm Taaza, however the firm has plans for the fund to make commitments to approximately 25 companies
B2B agtech platforms such as Farm Taaza are on the front line for investors to seize the opportunity for return on investment that can be gained from streamlining and disrupting severely outdated supply chain systems in emerging markets.
In August of this year Wamda Capital led a $10.3 million Series A for Kenya-based Twiga Foods. Much like Farm Taaza, Twiga is a disruptor of the food and ag supply chain that was launched with the goal of resolving the fragmentation in the produce market in order to generate value and returns for producers, vendors, and consumers. The round also included Omidyar Network, DOB Equity, Uqalo, 1776, Blue Haven Initiative, Alpha Mundi, and AHL.
Co-founded in Nairobi in 2014 by Grant Brooke, who ventured to Kenya in 2008 to conduct graduate work for his master’s degree, Twiga Foods was born from Brooke recognizing that the disorganized nature of the agriculture and food value chain was benefiting the brokers and not the farmers, and was blocking any attempts at solving issues in the market.
“The main reason markets do not work here is because there lacks a proper market infrastructure to support the 5 million population in Nairobi. As a result, produce goes bad and there are massive delays at the markets. This means that the cost of the same gets passed to the customer,” said Brooke.
For Wamda, the deal gave the firm exposure to a new geography and provided a new window for growth.
“Drawing on our experience in the logistics and supply chain space, we believe Twiga has developed a unique solution to address the inherent inefficiencies in the delivery of fresh produce in East Africa with significant positive impact for both producers and consumer,” said Fadi Ghandour, chairman of Wamda Capital.
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