The financing round for the software-as-a-service or SaaS platform which helps food businesses source produce from them comes six months after it raised $10 million as part of its first insititutional raise. The previous fundraise was led by Matrix Partners India, with particpation from Innoven Capital, existing investors Omidyar Network India, Avaana Capital, and 500 Startups.
With the new round, the total capital raised by the company so far is $48 million (Rs 366 crore).
Post a few business pivots since its launched six years ago, Farmart introduced a new line of business last year. “ Our current annualised revenue run rate stands at $70 million with a 25-30% month on month growth,” Alekh Sanghera, cofounder and CEO, Farmart told ET. The company is expected to grow faster over the next 18-24 months, with a bulk of its growth coming organically, he said. “ We will also look at inorganic growth opportunities to help us widen our product portfolio, enhance our tech abilities or to scale non-linearly by acquiring companies,” Sanghera added.
Founded in 2015 by Sanghera and Mehtab Singh Hans, FarMart’s model is centred around agri-input retailers and solves some of the challenges faced by the retailer community. It provides a micro-SaaS platform that enables retailers to digitize their workflows, increase sales to farmers and conduct their existing business in a more efficient manner. The startupt also helps retailers procure commodities from farmers and sell directly to large enterprises through the FarMart platform, opening up a completely new source of revenue for them.
Farmart claims to have around 60,000 retailers serving two million farmers through its mobile app. The company has also scaled its output linkage offering, distributed via its app users, to over 600 districts in India, with 75,000 metric tonnes of produce sourced till now across more than 15 commodities.
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“ Farmers have to travel 25-30 kilometers to access a formal marketplace. Leveraging the proximity, social capital and infrastructure of these agri-retailers, we are able to source directly from farmers in a capital efficient and non-linear manner. Removing excessive intermediaries helps in providing better prices to farmers, reduces direct cost and reduces spillages/wastage up to 10-15%,” said FarMart’s Hans.
“The fast-growing B2B platform activates critical connections between farmers and agri-retailers, enabling millions of farmers to supply fresh produce to consumers all over India, creating powerful, positive change for these stakeholders,” said Deep Nishar, managing director, General Catalyst.
Agritech startups in the country have seen record funding in 2021 with more than $480 million flowing into such firms so far this year, as per data from Venture Intelligence.
“FarMart’s SaaS-led approach has transformed the way in which farmers and agri-input retailers carry out their business. The business model innovation combined with on-ground execution has enabled FarMart to grow rapidly over the last 12 months while being profitable at the contribution margin level,” said Sudipto Sannigrahi, principal, Matrix India.
Those who have raised capital from risk investors in recent times include DeHaat, Reshamandi, AgNext Technologies, Cropin, Gramophone, Bijak, Onato, BharatAgri, and TartanSense.
