Vegrow Raises $13 Mn Co-led By Lightspeed Venture Partners And Elevation Capital
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B2B agritech platform Vegrow for fruits and vegetables announced on Tuesday to have raised $13 million in a Series A investment round co-led by Lightspeed Venture Partners and Elevation Capital. The round also saw participation from existing investors Matrix Partners India, Ankur Capital, Better Capital, and Titan Capital.
“At Vegrow, we focus on select products as compared to building a large basket. Each of these products is a multi-billion dollars opportunity. This enables us to go deep in the product value chain and unlock massive growth in this sector. In fact, we have become one of the largest companies for pomegranates in the country in less than a year. We are excited to expand to 100 cities, invest in technology and launch new products with this fundraise,” said Praneeth Kumar, Shobhit Jain, Mrudhukar Batchu, and Kiran Naik, co-founders, Vegrow, in a collective statement.
Established in 2020, Vegrow has scaled rapidly among both farmers and B2B customers, resulting in nearly twenty-time top-line growth with a presence in over 30 cities.
“Agriculture as a sector has largely remained removed from digital disruptions, despite the strong tailwinds of increasing internet penetration and adoption. We believe any effort to digitize these value chains will have to keep farmers and their interests at the core. Vegrow's farm-centered approach, coupled with strong insights, which are allowing the team to fundamentally re-imagine and augment these supply chains, stood out in our interactions. Super thrilled to be a part of this mission-driven team as they create access and value for millions of farmers,” commented Akarsh Shrivastava, vice president, Elevation Capital.
At the heart of this growth is their technology platform, which powers everything from farm discovery, produces quality profiling, market intelligence to smart matchmaking between farm-level inventory and customer requirements. The impact of this platform is clear in deep customer love and positive unit economics early on in the company’s journey.
“Having invested in commerce companies like Pinduoduo, OYO, and Zetwerk we have realized that the number one pressing need of the small supplier, a farmer in this case, is higher revenue realization. It’s not accessing inputs, credit or crop advisory. Therefore, we believe companies building marketplaces between farmers and buyers, using technology to eliminate inefficiencies will have the largest market opportunity eventually. Additionally, many marketplaces have scaled up on negative unit margins in this category, so we were really impressed by the growth - and - positive unit margin Vegrow has demonstrated using its technology-oriented approach to standardize quality, minimize inventory and retain farmers,” noted Vaibhav Agrawal, partner, Lightspeed.
“While Indian consumers and businesses have seen tremendous changes in the past 10 years through several waves of innovation, the reality is our fruits and vegetables are grown by independent farmers in a nearly identical manner, and with dwindling yields. Vegrow's tech-enabled processes allow the company to grow their margins while also driving value to the farmers they work with," stated Ritu Verma, partner, Ankur Capital.
“We are privileged to be the first to partner with the Vegrow team on their journey of building one of India’s largest agritech platforms. The team has the unique experience and know-how of grassroots agriculture — in fact, a few co-founders come from farming families and of building high-growth internet marketplaces. We love the company’s focus on aggregating fragmented farms to help unlock economies of scale with technology-led interventions which has enabled them to scale rapidly and profitably over the last 12 months. We believe they are well-positioned to emerge as the front runners of this space and streamline India’s largest yet unorganized industry,” added Sudipto Sannigrahi, vice president, Matrix India.
While India’s B2B Agri market is attractive ($300 billion), it is also a complex maze of fragmented supply with over 120 million farmers growing across 30 states. Vegrow is on a mission to unlock the power of India’s Agri value chain, initially focusing on the $50 billion fruits and high-value vegetables segment. The company addresses challenges around farmland under-utilization and supply fragmentation for farmers and delivers consistent quality along with fill rate to customers. Their unique farmer engagement model and tech-driven quality profiling is core to delivering higher returns to farmers, reducing supply-chain wastage, and improving procurement for wholesalers.