Patna-based agritech startup Ergos has raised INR 22.5 Cr from UK-based development financer CDC Group to close its Series A round at INR 81 Cr. The round also saw participation from the company’s existing investors Aavishkaar Capital and Chiratae Ventures.
In April 2020, Aavishkaar Group’s impact investment arm Aavishkaar Capital had invested INR 35 Cr in the agritech startup through their Aavishkaar Bharat Fund. In October 2020, Chiratae Ventures infused INR 23.5 Cr as part of the same round.
Ergos offers solutions for warehousing for farmers through its tech-enabled GrainBank that has been piloted in Bihar. The company intends to expand its footprint in more states with the new round of capital
Founded in 2012 by Kishor Jha, Priyanka Kumari and Praveen Kumar, Ergos is an agri-supply chain startup that helps small and marginal farmers in India digitise their food grain distribution. The agritech company offers doorstep access to end-to-end post-harvest supply chain solutions. Moreover, the platform also operates as a bank and offers several facilities — storage, digitisation, credit, and liquidation.
The agritech startup claims to be supporting more than 25,000 farmers on its digital platform and has a physical footprint in 80 locations.
“We are working on an expansion plan to set up at least 500-600 GrainBanks across Bihar and other conjugated states but primarily will remain focused on Bihar market only which is close to $ 12 Bn market for the commodity we manage i.e. wheat, maize and paddy. This expansion will enable us to manage close to 1000-1200 crore worth of farmers grain and to service close to 100 thousand farmers,” founder and CEO Jha told Inc42.
The startup’s mid term plan is to set up 2000 GrainBanks which will have capacity to manage close to 7000 Cr worth of grains. As they are already operating in 14 districts, the next strategy would be to go deeper and penetrate with one GrainBank at every panchayat level, said Jha.
According to the latest EY India report, adoption of agritech presents a market potential of $24 Bn by 2025. With Covid-19 impact giving tech-based farm and supply chain operations a big boost, many startups are seeing around 10x growth and multiple deals are in the pipeline after two quarters full of investments.
According to the Inc42 Plus report — India’s Agritech Market Landscape Report 2020 — India has over 1,000 startups in the agritech domain with over 467 Mn being raised between 2014 and H1 2020. Many other top investors such as Omidyar Network, Arkam Ventures, Ankur Capital and Accel Partners have also shown keen interest in agritech for the past six-seven years.