- Indigram Labs is one of the very few incubators in the country that solely focuses on food and agriculture. With the rise of startups in these sectors, what are the major changes you are seeing?
Our estimation is that there are more than 1000 startups in this space trying to address solutions across all the verticals in Agri & Food Domains. We also see a trend of non-ag background folks coming into this sector. With the rise in funding in terms of the quantum of deals we’re beginning to see good talent being attracted to this sector which eventually will lead to good innovations and also address solutions to bigger problems.
- Compared to innovation in other sectors where role of government has been minimal, the state is a major presence in these sectors. As per your experience, what should be the role of governments and how is Indigram Labs engaging them?
The current government has played a pivotal role in strengthening the start-up ecosystem by creating/ funding the incubators / accelerators all over the country which will reduce the failure rate of the startups to a very large extent. The state governments and Government of India can create an enabling environment for startups to create a large scale impact in the sector. We have suggested at multiple forums that the Government should treat the Farmer Producer Cos (FPCs) also as startups and get them associated with one or more of the 400 odd institutional incubators in India. The incubators could hand-hold them and also provide managerial and other bandwidth needed by the FPCs. Our host institution, ISAP, has engagements with multiple state governments and also various ministries in Government of India. Indigram Labs provide startups with our network, relationships and infrastructure for market access and product validation, testing and rolling out of services.
- Indigram Labs started an incubation program in food and agriculture when there were not many around. Do you think the situation has changed now? Should focus now shift beyond incubation?
We, at Indigram Labs, provide Incubation & Acceleration as well. Our strength lies in our on ground physical infrastructure which ISAP has created during the past 19 years. We have soft infrastructure in the form of our large presence on social media platforms where we engage with over half a million professionals across our various groups and pages. This helps with GO TO MARKET for commercialization of our incubatees’ technology / products/services. We have the ability to add value to even growth stage companies in agriculture. If you look at our portfolio there are a few companies with revenues in excess of INR 10 cr pa.
Besides us, there are a handful of incubators in this space in India and the Government has rightly focused on depth rather than breadth given the unique challenges of the sector. The current focus needs to be on incubation and building a large funnel of startups given the small percentage that reach scale and raise multiple rounds of funding.
- There has been a significant uptick in funding in food and agri in 2019. What are your views on the funding scenario so far and how do you see it shaping up?
The funding will pick up further. Ninjacart funding which followed Agrostars showed that USD 30-80 million kind of deals were possible in the sector. We should soon see some more USD 50 Million cheques going to a couple of more startups soon. A lot of other Institutional Investors have started looking at AgTech very seriously.
- Indigram has been looking at North East and trying to promote entrepreneurs from there. What is your observation on innovation there?
There are good quality start-ups there but due to lack of good mentors & exposure the startups there are not able to scale-up. Majority of the start-ups there are non-tech and their major focus is towards market linkages through B2B or by building consumer brands.
- If you had a wishlist of changes that you will like to see in the ecosystem, what will those be? Can be in terms of funding, policy changes etc.
Government should treat the Farmer Producer Cos also as startups and get their associated with one out of the 400 odd institutional incubators in India. The Government could open source access to government agri/farm data for start-ups. Relaxing the norms for startups to apply for government tenders wherever possible to make them sustainable.
We need a lot more institutional investors to deploy funds in this sector. Presently a very few startups get funded by institutional players.