Vegrow, an India-based business to business (B2B) fruits marketplace, announced it has raised $46 million in primary and secondary funding.
The new funding round is led by GIC, Singapore’s sovereign wealth fund, with significant participation from existing investor Prosus Ventures, and continued support from Matrix Partners India, Elevation Capital, and Lightspeed, Vegrow said in a statement on Wednesday.
According to the statement, the funds will be utilized to drive Vegrow’s reach across India and fortify its global network.
Avendus Capital was the exclusive financial advisor to Vegrow on this transaction.
“Vegrow is the fastest agri-tech company to build a national presence, having done this within three years of its inception,
“Typically, it takes double the time to achieve this scale of operations,” said Vegrow Co-founder Praneeth Kumar.
According to him, the company’s strategy marks a significant advancement in the efficiency and reliability of the fruit ecosystem.
He said that over the past year, Vegrow has experienced a remarkable fivefold increase in revenue and achieved operational profitability.
Meanwhile, Vegrow Co-founder Mrudhukar Batchu said that a Vegrow, they distinguish themselves from conventional operations, by creating an organizational ethos centered on agility and experimentation.
“Through the extensive utilization of data and technology, we provide valuable insights and optimize supply chain challenges, such as reducing perishable inventory wastage to only one-fourth of industry average, and consistently achieving industry-leading profit margins,” he added.
It is noted that Vegrow has established a strong presence in the fruits segment in India, which is a large, unorganized market that is poised for tech-led disruption due to its fragmented and localized operational structure and is characterized by the involvement of multiple intermediaries facilitating transactions.
The firm’s competitive advantage is the depth of its multi-channel demand stack and its use of technology for demand-supply matchmaking.
The company maximizes farmers’ income, by accurately grading produce and efficiently matching it with the most suitable demand channel.
This creates a virtuous cycle, attracting more farmers through competitive pricing as well as more buyers, who seek consistency in both price and quality.
“Vegrow is committed to making a positive impact for both farmers and the planet,” said Vegrow Co-founder, Shobhit Jain.
According to him, the firm’s ambition is to establish ourselves as the undisputed leader in every fruit category, ensuring transparency and higher income for farmers, while also reducing carbon consumption through supply chain optimization.
It is noted that for GIC, Vegrow marks its first agri-tech and B2B investment in India.
GIC noted that Vegrow leverages technology to create win-win outcomes for all stakeholders in the agri-value chain.
“The founders’ extensive experience in the sector and demonstrated execution differentiates them, GIC is looking forward to partnering with Vegrow in their next phase of growth,” said GIC.
Meanwhile, Prosus Ventures believes Vegrow operates in an attractive sector and is creating a superior experience on both supply and demand side.
It opined that the founding team has demonstrated strong execution capabilities and focused approach on profitability.
Buoyed by the future growth outlook, Prosus Ventures has increased its ownership in the company. It looks forward to the next phase of growth.
As the first backers of Vegrow, Matrix Partners India has also witnessed the company’s evolution from concept to category leadership in the about $50 billion fruit segment.
Matrix Partners India opined that the founding team’s expertise, systematic problem-solving approach and the adept use of technology to minimize inefficiencies and waste, has been noteworthy.
It said that Vegrow’s strategy has not only allowed them to establish a sustainable economic model, but also led to increased income for every participant in the supply chain.
“Today, the company continues to thrive, with healthy operating profits,
“Matrix Partners India has consistently increased its investments in Vegrow in every funding round and is optimistic about the company scaling to greater heights,” it said.
Elevation Capital, on the other hand, believes Vegrow has been able to drive substantial impact across the fruits and agri ecosystem within three years.
“Not only have they improved the quality of lives and earnings of farmers, but they have also demonstrated that technology, when implemented well, can be used to drive efficiency and scale in such decades-old supply chains,
“The journey so far has been fulfilling and Elevation Capital is excited to deepen this partnership further in this round,” it said.
Lightspeed also sees potential to partner with Vegrow on its mission to transform the agricultural value chain and B2B fruits marketplace through innovative technology.
“With a robust national presence and sustainable model, Vegrow has consistently empowered and added value for all stakeholders in the pyramid,
“Lightspeed is pleased to extend its support once again and deepen the partnership with Vegrow as it shapes the future of B2B agri-tech,” it added.
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