Prosus leads $25m Series B for India's Vegrow

Matrix Partners India, Elevation Capital, Lightspeed India Partners, and Ankur Capital also participated. Matrix, Ankur, Better Capital, Titan Capital, and several angel investors provided USD 2.5m in seed funding in April 2021. Three months later, Lightspeed and Elevation led a USD 13m Series A, with re-ups from Matrix, Ankur, Better, and Titan.

Vegrow was founded in 2020 by Kiran Naik, Mrudhukar Batchu, Shobhit Jain, and Praneeth Kumar (pictured, left to right). They claim experience across agriculture and technology-enabled marketplaces through stints with services platform Urban Company, software provider Chronus, and ITC, a conglomerate with interests that include agribusiness.

The company’s offering is based on a data-tech stack that matches sources of supply and demand. It has signed up more than 20,000 farmers and plugs them into a network of wholesalers and semi-wholesalers in modern and general trade in 100 cities. Vegrow’s business has grown 15x in the past 12 months and boasts industry-leading gross margins of around 20%, Prosus said in a statement.

Communication is a key part of the offering. The company engages with farmers across over 400 product categories, helping them boost yield and income by aligning with market expectations and demand trends. The marketplace is equipped with tools to track farmer social media chatter, estimate farmland output, and measure demand in tier-one through tier-three markets.

Vegrow processes more than 200 tonnes of fruit each day, accounting for a relatively small part of India’s USD 60bn fruit industry. However, the company has already carved out a market-leading position in pomegranates and ranks in the top five for several other categories of fruit.

“Being a table-top consumption product, fruits are consumed raw, and consumers are highly sensitive to the quality. Vegrow adds value at the source and supply chain to ensure and preserve the quality consistently,” said Jain. “We aim to grow sustainably and deliver a USD 5bn outcome within the next five years.”

The new capital will be used to expand into more demand centres, establish dominant positions in certain supply-side niches, and recruit and nurture top talent in product, engineering, and other support functions.

“We have been tracking the agritech space closely through our existing investments in fresh produce and animal protein segments. The fruits industry being historically unorganised, fragmented, and inefficient, is poised for similar tech-led disruption,” said Ashutosh Sharma, head of India investments at Prosus.

“Vegrow has catapulted to pole position by serving pan-India demand through its focus on scale and technology. We are excited to back them as they chase the next level of growth in the country.”

Elluminate Capital served as exclusive financial advisor to Vegrow on the Series B.

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• Topics
• South Asia
• Early-stage
• Technology
• Agriculture
• Agritech
• Prosus Ventures
• Matrix Partners
• Elevation Capital
• Lightspeed Venture Partners
• Ankur Capital