Crofarm secures $1.5 million in seed round; to expand supply chain network to 10 cities this year

By Supraja Srinivasan
MUMBAI: Agritech venture Crofarm has raised seed funding of $1.5 million from Mukul Singhal and Rohit Jain, former principals at SAIF Partners, who have backed the company which aims to create a supply chain which links farmers with businesses.

The round also saw investments by some angel investors including Himanshu Aggarwal, Co-founder & CEO of Aspiring Minds, Ashish Gupta, Former COO at Evalueserve and Sunil Goyal, Vice-President at Paytm.

"We plan to establish presence in tier-2 markets and hope to operate in 10 cities over the next year,” said Varun Khurana, chief executive officer of Crofarm

Crofarm has a network of over 10,000 farmers from whom it procures produce directly and delivers to various organized retail players such as Big Bazaar, Reliance Retail, Grofers, Big Basket, METRO Cash & Carry and Food Works. It’s key focus, however remains the unorganised sector which constitutes over 80% demand for the farmers’ produce. “We have 3 distribution centres in the Delhi-NCR belt & 1 in Mumbai where produce from farmers gets delivered which then gets picked up by the unorganized market players,” Khurana told ET.

Set up in May 2016, Crofarm works on a commission-based revenue model. The commission ranges from 5-7% for less perishable produce like potatoes & onions, 15% for greens & 20-25% for exotic fruits & vegetables. Khurana says produce with a longer shelf life is procured from national sourcing zones while easily perishable ones are bought from regional sourcing zones.

With Crofarm, farmers are able to earn upto 25% more than when they sell to the Mandis. Khurana hopes to have one lakh farmers and over 10,000 retailers on the platform. " We hope to reach a stage where we will be able to direct farmers on the kind of produce that they should grow in keeping with rising demand,” he said.