Indian post-harvest services startup Arya has closed $60 million in Series C funding.
- Asia Impact SA, Lightrock, and Quona Capital co-led equity portion of the round, worth $46 million.
- A further $14 million in the form of debt came from US International Development Finance Corporation and ResponsAbility, among others.
- The round values Arya at reported $300 million.
The Noida-based startup provides logistics, warehousing, and financing solutions aimed at small-scale grain growers, whose lack of sufficient access to such services can lead to lost income and food waste.
The bigger picture:
The UN Food and Agriculture Organization estimates that as much as 40% of food produced in India is wasted before it reaches consumers, amounting to $14 billion in lost value – and compounding the country’s chronic hunger problem (it was ranked 101st out 116 countries by the 2021 Global Hunger Index.)
A study by India’s National Academy of Agricultural Sciences found that a lack of adequate storage is the major cause of post-harvest food losses in the country. A conservative estimate puts average post-harvest, pre-consumption loss of grains at 6%, driven mainly by storage in insufficient bags, spillage, rodent attacks, contamination, and theft.
To avoid these outcomes, large-scale growers can generally afford to transport their produce farther afield, or use higher-quality storage facilities. But small-scale growers and smallholders typically seek to sell their produce as quickly as possible; during the post-harvest glut, that means they often have to sell at throwaway prices, representing a lost income opportunity.
How it works:
- Arya seeks out smaller-scale warehouses and storage facilities, conveniently located close to farming communities, and lists these on its online platform.
- Growers can use the online portal to search for, compare, and book suitable warehouses where they can store their produce after harvesting and prior to sale.
- Arya also offers financing solutions to cover cash-strapped farmers’ costs between harvest and sale; as well as an online marketplace for buying and selling agri-commodities. It claims to have handled around $2 billion in grain transactions to date.
- “Because we hold the commodity in our warehouses, we have complete visibility into quantity and quality. This is how we are able to establish a connect between the buyer and seller,” co-founder Prasanna Rao told TechCrunch.
“We intend to use the funding to capture more than 20% of the $100 billion grain commerce market,” Rao told The Economic Times.
Arya has close to 10,000 warehouses across 21 states in its network at the moment, up from just 1,500 a year ago; its target is to grow this to 60,000 over the next four years.
“Given that there has been substantial growth in our volumes and that the lending book has expanded […] we have already initiated a [further] $100 million fundraise which should be done in the first half of the current calendar year,” Rao said.
By the numbers:
Indian startups focused on the ‘messy middle’ of the agrifood value chain raised a combined $176 million across 29 deals in FY21, according to research by VC firm AgFunder – making Midstream Technologies the country’s most active category in terms of deal volume [disclosure: AgFunder is AFN‘s parent company]
Midstream Technologies is a category created by AgFunder’s research team to cover everything in the food value chain that sits between the farm (or the lab) and consumer-facing areas like retail and foodservice: it includes logistics and transportation, processing, food waste mitigation, farmer-to-business e-commerce, and safety and quality testing, among other areas.
Arya was among the top-funded Midstream Technologies startups in India during the last financial year, raising $21 million in Series B funding in December 2020.