Agriculture and foodtech startups in India raised $2.4 billion in funding in 2022, a 33% decline from the previous year. The decrease in investments in the agritech sector mirrored a fall in VC funding in other startup sectors like healthtech, fintech, and direct-to-consumer brands. However, investors are still interested in specific sectors, including those focused on farmers and climate change. Startups innovating upstream, closer to farmers and across the supply chain, raised $620 million, up 50% from $409 million in 2021. Agri-business marketplaces and agri-fintech were the most popular upstream categories among investors. Farmtech investments also remained relatively strong, raising $1.1 billion, a modest 15% drop from the previous year. Downstream startups, which include companies offering products and services across the value chain – from farm to consumers – saw a 37% plunge in funding compared to 2021 due to consolidation and lack of innovation. Meal marketplaces and e-grocery were the most funded downstream categories yet again. The capital raised by these two categories accounts for 54% of total funding in Indian agri-foodtech, with e-grocery startups landing the highest number of late-stage deals. Food delivery startups waned mainly due to consolidation and the lack of innovation with Swiggy raising $700 million in January 2022 and committing to investing heavily in its quick commerce vertical Instamart. Mumbai-based Zepto, which offers 10-minute grocery delivery, raised $200 million in May 2022. Midstream technologies deal activity decreased though the category remains active with $178 million raised across 14 deals. Midstream startups help the middlemen in the agriculture value chain, especially in distribution and marketplace functions. Despite the transient headwinds, agri-foodtech in India will continue to surge ahead with investors keeping a close eye on specific sectors, including those focused on farmers and climate change.
#agriculture #agritech #startup #farmer #business
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