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NEW REPORT: Indian agrifoodtech startups net record-breaking $4.6bn in fiscal 2022 year

November 30, 2022

Disclosure: AFN‘s parent company is AgFunder.

Indian agrifoodtech startups netted a record-breaking $4.6 billion across 230 deals in the fiscal year 2022 (FY22), according to the AgFunder Indian AgriFoodTech Investment Report 2022, in collaboration with venture capital firm Omnivore. This is a 119% jump in dollar funding compared to the previous fiscal year, which runs from April to March.

Between April 2021 and March 2022, agrifoodtech investment trends in India were similar to those in Europe and the Asia-Pacific region as downstream categories such as eGrocery and Restaurant Marketplaces captured the bulk of VC funding buoyed by jumbo-sized deals.

Investment in farm technologies was particularly buoyant, increasing 185% year-on-year and accounting for 60% of the total number of deals closed.

However, looking ahead to the rest of the 2022 calendar year, it appears that India will not be immune to the current economic downturn, with fewer mega deals pushing totals up and just a few deals closing at or above $100 million.

The newly-released Indian agrifoodtech report tracks the 12 most active investors in India. Omnivore made 15 investments in FY22, while Australian firm NAB Ventures did five investments. UK-based Lightrock supported three startups mainly through co-investments.

Source: India AgriFoodTech Investment Report 2022

Restaurant marketplaces still a favorite for investors

For FY22, startups operating Restaurant Marketplaces maintained the top spot for VC investment; the category raised $1.95 billion compared to $1.33 billion in FY21.

AgFunder defines Restaurant Marketplaces as online tech platforms that deliver food from a variety of vendors. Rivals Swiggy and Zomato are two of the sector’s biggest names in India. In fact, Swiggy‘s $1.2 billion raise led by Softbank Vision Fund 2 and Prosus was the largest agrifoodtech investment during the year.

Combined with eGrocery, these two sectors secured $3.35 billion in funding — around 73% of total investment. This is a trend that India shares with the Asia-Pacific region, except that eGrocery startups were better funded than Restaurant Marketplaces across Asia-Pacific, no doubt in large part to China’s mega eGrocery deals.

Nearly $2 billion for farmtech

Farmtech includes all technologies used by farmers and are a sub-sector of what we call “upstream” innovations. As with the category globally, India’s farmtech startups aim to boost farming outcomes and to foster stronger connections between farmers and buyers.

Funding for India farmtech startups in FY22 reached $1.5 billion, a 185% year-over-year increase on the $527 million raised in FY21. The farmtech category accounted for around 43% of all agrifoodtech investment in India and 60% of all deals.

The steady demand for traceable quality produce has also played an important role in encouraging innovations aimed at ironing out chronic inefficiencies.

Source: India AgriFoodtech Investment Report 2022

New investment frontiers for India

One farmtech category was particularly fast-growing in FY22; Ag Biotechnology startups raised 218% more compared to FY21, reaching $114 million. But the largest was Agribusiness Marketplaces as investors poured $569 million into startups linking farmers with inputs, services and markets. This category included India’s biggest-ever agtech deal, in a $115 million Series D raise by DeHaat. [Disclosure: AFN’s parent company AgFunder is an investor in DeHaat.]

Midstream Technologies, which innovate throughout the supply chain, raiesd $461 million in India in FY22. Of that, $145 million went to fresh produce supply chain platform Ninjacart.

Download the full report here.

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