Omnivore has sunny outlook for SkyMet

Weather-based agricultural insurance is essential to farmers looking to mitigate the risk of failed a crop. To meet this demand, insurance firms require reliable and consistent weather data which - until recently - has been lacking in India.

Weather and crop forecast solutions provider SkyMet, which has just raised $4.5 million in a Series B round of funding, is filling the gap. The round was led by dmg::information Asia Pacific, a unit of UK media group Daily Mail & General Trust (DMGT). Around 40% of the round was covered by SkyMet's Series A backers Omnivore Partners, which specializes in agri-tech innovation in India.

"Traditionally agricultural climate data in India have not been very accurate, so a lot of what SkyMet is doing on the risk analysis side is building the data that were never really there before," explains Mark Kahn, founding partner with Omnivore.

The 2011 Series A round - Omnivore's first investment from its INR2.5 billion ($40 million) maiden fund - saw the GP put in INR45 million for a 33% stake. Kahn explains how the business fit perfectly within the GP's investment theses: an execution play where there is very little competition, huge first mover advantage and the ability to scale very rapidly.

"The owner had bootstrapped the business at first, but after a couple of years found he really needed a capital infusion in order for it to take off," says Kahn. "He needed money to invest in good IT, good talent and good infrastructure. He met with us and we looked at the business, spoke to his customers who loved it, and we realized we had a gem of a company."

Set up in 2003, SkyMet is now the largest B2B weather monitoring service in India. Through its cloud-based information platform and risk management service, it provides data to clients across several sectors including media, power, shipping, aviation, construction and telecom. Major clients include Thomson Reuters, the Ministry of Agriculture, the World Bank and Monsanto.

The plan is to expand the company's network further and penetrate every corner of the country. The new funding will used to build a data center that will layer on top of SkyMet's monitoring network. Capital will also go into research and development for better weather and crop yield forecasting. The company will then expand overseas.

"They are beginning international expansion," Kahn says. "They are looking at opportunities in other parts of Asia and Africa. There will be a big sales and marketing push too, and they will be re-launching their consumer website in late August."

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