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Aavishkaar Capital invests $5 million in agri-tech startup Ergos
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Ergos Business Solutions, which runs an eponymous agri-tech startup, has raised $5 million in a Series A round led by returning investor Aavishkaar Capital, the impact investment arm of the Aavishkaar Group.
The investment is expected to be a part of a larger Rs 100 crore (around $13 million) round, which will see participation from Aavishkaar Capital and an undisclosed technology venture capital fund, the company said in a statement.
Aavishkaar had first invested $640,000 in Ergos in 2015. In 2016, it doubled down on its bet, with a $1 million infusion in the company.
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In 2017, the impact investment firm had put an additional $0.59 in the company, according to VCCEdge.
“Our focus is to build this grain bank to serve post-harvest requirements of all farmers with a focus on small and marginal farmers. With Aavishkaar Capital’s backing and other investors to join, we intend to rapidly scale into nearby states and service more than a million farmers by 2025 with over 2,000 branch locations,” Kishor Jha, founder & CEO of Ergos said.
Ergos was founded by Jha and Praveen Kumar in 2010. The company has been building a "grain bank", which is aimed at the small and marginal farmers in India.
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The model, which has been piloted in Bihar, helps farmers digitise their food grain and provide doorstep access to end-to-end postharvest supply chain solutions. It operates like a bank and offers storage, digitisation, credit and liquidation facility to farmers through a single platform.
Currently, the technology platform of Ergos supports more than 20,000 farmers and it has a presence in more than 60 locations.
“While the role of technology as a lever cannot be overstated, the Ergos Business model is a beautiful combination of entrepreneurial spirit, technological intervention and massive demand-pull delivering a business model that matches all our criteria. I am confident that with adequate capital, Ergos would influence the Indian farming landscape significantly and quickly,” Vineet Rai, founder and managing partner at Aavishkaar Capital said.
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The Aavishkaar Group helps entrepreneurs via equity funding, venture debt, microfinance, investment banking intermediation, consulting, research and access to global networks. The firm invests in sectors such as agri-services, food processing, inclusive finance etc. It currently has $450 million in assets under management.
Last month, Aavishkaar Capital had invested $5 million in fintech startup Chqbook.com.
The agritech sector has always attracted investors’ attention. Last month, Delhi-based Arya Collateral Warehousing Services, which provides post-harvest supply chain services, raised $6 million in an extended Series A round (pre-series B) from impact investor Omnivore and returning investor LGT Lightstone Aspada.
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In February, Omnivore Capital Management Advisors and venture capital firm Accel India Management co-led a $5.5 million Series A funding round in business-to-business (B2B) agritech startup Clover Ventures.