According to government data, agriculture in India provides livelihoods to over 42% of the population and contributes 18% of the country's GDP. However, the agricultural inputs market, which supplies the sector with inputs such as seeds, pesticides, herbicides, and cultivation and harvesting tools, relies primarily on traditional channels, including local offline markets. The sector lacks a robust supply chain, and logistics are complex in the remote areas where most farmers live.
Moreover, the agricultural input landscape in India differs from that of the US and Europe due to fragmented market structure, diversified demand, and crop seasonality.
Agrim aims to address all these contradictions by creating a just-in-time supply chain that allows agricultural input retailers to buy inputs from specific manufacturers.
Co-founder Mukul Garg said in an exclusive interview that the marketplace helps deliver orders to manufacturing warehouses the moment they are placed by retailers.
Garg, a second-time entrepreneur who co-founded travel app Tripigator in 2013, founded Agrim along with Avi Jain in April 2020. He previously headed product and growth at logistics company Blackbuck and was responsible for building an on-demand trucking marketplace.
Agrim caters to retailers and manufacturers who have never used an e-commerce platform before, offering a minimalist user interface with the ability for retailers to set prices. The portal also includes a custom-designed order management system that assigns each order to a manufacturer and ensures that pickup and delivery schedules are matched. Additionally, the startup works with multiple third-party logistics service providers to handle last-mile delivery.
The startup currently offers a catalogue in four categories: seeds, pesticides, nutrients and tools, each of which also includes subcategories such as herbicides, fungicides and insecticides for crop protection (600 subcategories in total), as well as 70 subcategories in the equipment segment such as hand and power tools.
Agrim uses a pricing intelligence model to set the right price for the products it gets from manufacturers. The company's platform allows for dynamic pricing, with system algorithms that set prices based on factors like supply and demand. Garg said the startup offers manufacturers a set price and then takes a margin that ranges from 10% to 60-70%.
Agrim also offers financing to retailers who typically can't get credit through traditional channels — about 10% of its retailers currently use its credit services, Garg told TechCrunch. The company hopes to expand that business to 30% of retailers over the next few years, including by extending credit terms from 30 days to up to 45 days.
Now, the four-year-old company has raised $17.3 million in a new funding round led by Asia Impact. Garg told TechCrunch that the company plans to use the new capital to expand its catalog of agricultural supplies from more than 30,000 items to 150,000 over the next three years and expand into southern and western India, including parts of Telangana, Karnataka, Tamil Nadu and Maharashtra.
Similarly, the startup plans to expand its catalogue by adding two new categories: animal feed, which includes cattle, fish and shrimp feed, and irrigation equipment testing.
Agrim also aims to enter the private label agricultural inputs market within the next six months to enable farmers to obtain inputs at retail prices rather than paying premium prices.
“We are democratising as a platform,” Garg says. “We see a lot of mismatch between supply and demand, so with private labels we want to solve that unmet demand and supply.”
Agrim claims to have 1,200 manufacturers and 25,000 retailers serving 15 million farmers. The startup generated more than $36 million in revenue last fiscal year and is on track to reach nearly $60 million in annual revenue.
The all-equity Series B round also saw participation from existing investors Accion Venture Lab, India Quotient, Kalaari and Omnivore.