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AgriTech, the Evolving Culture | Sanjaya Mariwala

Centuries after the industrial revolution, we are in the era of digital transformation. So evidently, information technology has spread its roots in almost every sector. The culture shift is visible not just in essence but even in the terminologies; “Agritech” being the classic example. FICCI reports that there are more than 450 agritech start-ups in India as of today and are growing at the rate of 25%p.a. The evolving digital ecosystem is presenting exciting opportunities for innovation in agriculture and the young technocrats are constantly breaking new grounds to create new possibilities.

As the advancement in machineries helped in bringing efficiency and scale in Agri sector, the new age digital technologies are attempting to bring better connectivity, whether it is with nature or within the value chain. Key challenges that most agritech start-ups are attempting to resolve are around providing market access to the farmers, technology that can give quality inputs to plan the crop cycle, institutional credit, adequate crop insurance cover, water conservation techniques, and so on. Some of the areas we need to focus on are the ways and means to enhance crop yields, importing more species especially those having significant medicinal utility and cultivating it domestically, and increase the acceptability of Indian produce in the international market.

Traceability is one of the best solutions to assure quality and thus attracting the demand in global trade. It also allows the consumers, whether in B2B or B2C segment, to make informed decisions while purchasing. Traceability is a big challenge in the agriculture supply chain as there are multiple points between the crop produce and final consumers. Every crop has multiple final produce possibilities. It gets exported and consumed in multiple geographies, and has various production touchpoints involved. All these add to complexities and hence, end-to-end traceability is critical. With sensors, readers, and scanning technology, it has become relatively easy to create a complete record of every product as it moves through the value chain. RFID Tagging, Blockchain, and Distributed Ledger Techniques (DLT) lead the way in technological solutions for traceability. Apart from quality assurance, traceability offers many benefits like capturing data from remote, scattered, and multiple locations, facilitating quick course corrections by monitoring the produce at every single step and spotting the contaminated basket more accurately amongst others.

GPS enabled technologies also have huge potential. They enable weather prediction, crop tracking, identifying disease potential to crop, and soil condition analysis. Farmers can also give manufacturers more accurate crop size estimates. This in turn helps them decide better on the other supply chain decisions like truck size, consignment booking, loading-unloading labour requirements, and in turn enabling huge savings in cost.

Technology should also be utilized to improve Agri infrastructure. Fragmentation of holdings, erosion of top soil, and dependence on rain water irrigation are some of the reasons for the low crop yields. We need to harvest enough rivers to develop canal irrigation, rehab the deforested land to restore soil fertility, develop and promote terrace farming that prevents soil erosion and helps in water conservation, invest in more research labs to identify combinations for intercropping that can help both the marginal holdings as well as soil conditions. And all these in turn helps in improving crop yields.

Many such areas are still relatively unexplored and potential exists for further innovation and expansion. Water table mapping solutions, mechanised harvesting and plantation, warehousing, cold storage, temperature control systems, robotic movements, automated picking tools, inventory management through tagging, all these tools and solutions presents promising opportunities for the agritech companies. Another important aspect is awareness. For all these solutions, it is of utmost importance to educate farmers about the need and importance of these tools. It will enable acceptability from the farmers and ease the adaptability. Agritech companies should think about having a separate advisory vertical that can either reach out to the farmers directly, through FPOs, or through the industry players and create awareness to increase penetration. They can even provide solutions in advance so that the farmers can experience the real benefits.

Over the last 50 years, we have seen the agriculture sector going through a major shift. The economy at the centre has taken a growth-oriented approach and if we want to walk along, we will have to advance ourselves with these technology-enabled solutions. There are technology driven success stories in India, e.g. farmers adopting new crops and species beyond their usual produce, horticulture production doubling in last 2 decades and India becoming the 2nd largest producer after China, success of grapes, pomegranates, milk, potato making marks in India and so on. We need to extend and replicate these both in terms of geographic reach as well as for more varieties. Extensive and efficient use of AI, ML, IoT becomes imperative to expeditiously move towards Agri 3.0 and 4.0.

While the government has launched initiatives like eNAM to promote the agritech ecosystem, we are yet to learn our lessons and build a robust agritech policy framework. Increased collaboration between all market participants such as farming communities, agritech companies, food processing organizations, technology providers, research institutions, and industry players is a must. We need workers and trained tech assistants to deliver technology to the bottom pyramid and deliver the technology to them. The change in culture is imperative and offers significant opportunities to tap.

Mr Sanjaya Mariwala – Executive Chairman and Managing Director, OmniActive Health Technologies, and Founder-president of the Association of Herbal and Nutraceuticals Manufacturers of India. 

 

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Fight against COVID-19 – How our portfolio founders are responding to this crisis

Fight against COVID-19 – How our portfolio founders are responding to this crisis

We recently held a webinar with our portfolio companies to understand how founders are navigating various challenges they are facing due to COVID-19.

Below is the list of founders who attended the call.

Aastha Verma (Tardid), Antim Suman (Edgistify), Ashish Korde (Sattvaponics), Hardik Gandhi (Zestl), Ishan Nadkarni (Impact), Kamal Kumawat (Edgistify), Kevin Parekh (Sattvaponics), Kushagra Sinha (Jiny), Prateek Sharma (Nanoclean), Rohit Gajbhiye (Financepeer) and Umang Shukla (Edgistify).

This session was moderated by Subhash Prajapat from the PitchRight team. Amit Patel, Bhavik Rathod and Ravi Sanghvi from the PitchRight team also joined the call.

Here is a summary of the discussion:

Subhash: How are your going about cost reduction in order to increase your runway?

Ishan: We took a slight hit on revenue due to Covid-19. But it was not much because digital health is booming. In medium to long term business is going to grow. For short term we are cutting down on all non-essential costs.

With our office space provider CIBA, we negotiated a deal to not pay rent for 3 months. We also had a candid conversation with out CA partners that we won’t be able to pay for next 3 months. They have agreed. We initiated the same conversation with AWS but they didn’t agree.

In order to not extend this scenario as a fear to our team, none of the employee salaries have been cut. Nikhil (co-founder, Impact) and I have decided to not take any salary till everything goes back to normal.

If the world does not come back to normalcy anytime soon, we will ask our core team to take a 30-50% pay cut. Apart from that nobody else will take a hit. So 12 of our 16 team members won’t get affected.

Kamal: Before Covid-19 we were going on a dream run. A lot of deals were in the final stages of closure. So from business perspective we had to take a hit. Many of our customers are in e-commerce. So hopefully they will start their operations soon.

Luckily our rental agreement for our old office was about to expire. We didn’t renew that and saved our rental cost.

Our core team has taken a hit of 50-60%. There are employees who are getting 100% of their salaries based on their financial condition. One of our bigger costs was travel. But because of Covid-19 that is anyway not happening.

Subhash: Are you looking at changing your business model or diversifying your business?

Rohit: Luckily we are in education space which is not widely affected. But since Covid-19 is not something that will just last for 1 or 2 months, we had to think of alternate models.

A lot of other opportunities came naturally to us. For example we are into school fee financing. So we thought to leverage our existing distribution network to build a platform that aggregates educational content. You may call it Netflix for education. We started going to schools with the platform and so far we have seen a 100% hit rate for this product. So we are not deviating from schools to something else but we are looking at different products to pitch to our existing customers. The most important thing was to act quickly.

Kushagra: Till now we were focusing only on growth in Bharat. We had been building a new product category. We were successful to some extent since some large customers have adopted our product.

With Covid-19, I was not sure how valuable the use case of growth into Bharat is going to be. So we have paused some of the engagements on this front. We realised very quickly that over relying on just one case is not correct.

We also started diversifying geographically. This was always the plan to do it later on. But we expedited it because of the situation. We started looking at global markets starting with the US and other use cases apart from Bharat on-boarding like products to drive engagement, support etc.

We will start rolling our product in 2 months. Also we are moving to complete cloud platform to make it self serve.

Hardik: As a company over the last year we focussed on high growth companies who were expanding their physical presence across India. But because of Covid-19, expansion plans are now going to be put on hold. Still some companies continue to expand but a lot of them have stopped. For example Cure Fit has put expansion on hold since their business model is in trouble. So our solution has been put on ice for 6 months.

But we quickly branched out in our existing customers to other use cases so that we don’t lose out on our license fee. Luckily with a few large customers we were able to find use cases in operations where they were looking to drive process efficiencies. A few use cases got rolled out. And now we have decided to shift our focus from expansion to operational driven use cases.

Subhash: What best practices have you come up with for adopting work from home while still maintaining workforce productivity?

Aastha: Much before lockdown happened we anticipated it. We sent back employees who hailed from outside of Bangalore back to their hometown. We shifted almost 12 people to their hometown.

As a practice we start our day with a 9:30 a.m. call. On the call, the senior management understands from the team what they have delivered the previous day and what do they aim to achieve on that day. This also gives people a sense that the whole team is doing their bit. Whoever is facing some trouble can sort it out on the call. This is followed by a closer call at 4:30 p.m. Our head of engineering and productisation have prepared a progress update on each team member.

For us Covid-19 has come as a blessing in disguise. With Covid-19 every country is looking to become self sustainable. There will be lot of ease in local buying. Since we are in defence, now we can compete with larger foreign competition.

Ashish: Our major focus was development of some nutraceutical ingredients which we were planning to launch in Europe. That is now delayed by at least 3 months. Our labs have closed down. So essentially our scientists are sitting at home. We are working on building entire product roadmap.

We have not imposed any strict restrictions on working hours. We block certain hours in a day to have discussions related to IT and product development strategy.

Subhash: Have you made any changes in your business development strategy?

Ishan: Both business conversation style and messaging have changed. Messaging has changed to a painkiller positioning. We position our solution to take care of employee’s mental well being in this stressful scenario. Along with it company good will and brand also reaps benefits.

With respect to how we are communicating, video calls is the way to go. Everyone has moved online so closures will have to be done online. I am pushing our sales team to close USD 100K-1M deals on call.

Umang: For us the offering and the pitch have changed. We took the decision pretty early on 15th March and asked all employees to work from home. We restructured teams and workflows to ensure we are doing the most we can.

We found our customers now had some time to have a discussion since everything was shut. Hence we showcased our product to them. Our workforce changed their pitch towards product driven demos.

We also used this time to speak to our supply side which comprises of warehouse owners. Both operations and sales need recalibration going forward.

Amit: Thank you so much guys for joining. We will pass through this tough time together soon. But we have to make sure we keep communicating with all key stakeholders throughout this period. Over-communicate if need be. Track your business metrics, do scenario analysis and do business continuity planning. We have shared a MIS format for recording and tracking business metrics with all of you. Use it to constantly be aware of where you stand and also communicate with your investors to seek help wherever required.

We pray for your good health and safety. Be safe and wish you all the best.

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COVID-19: Sectors that are set to benefit from this pandemic

COVID-19: Sectors that are set to benefit from this pandemic

Coronavirus outbreak is having a growing impact on the global economy. It is bringing financial unrest for millions of individuals and businesses. But there are parts of the technology industry that are benefiting from the changing
environment.

Video conferencing and collaboration

Zoom Video Communications, a remote video conferencing services company headquartered in San Jose, USA has seen share price increase 100% since the beginning of the year.

Zoom Communications skyrocketed from $108 on March 16 to $162 on March 23. An increase of 50% when stock markets are slumping more than 30% is astounding. It is a true success story amidst a global crisis.

Traffic to Zoom’s website has increased by 10 million site visits in the month of February. Search volume for Zoom also rose 22% from January to February and is projected to increase by 108% from February to March.

Below is a screenshot from Google Trends. It clearly shows a 50 times jump in google searches in last week of March.

Cloud Computing

As more employees find themselves restricted to their homes, more workloads will have to be migrated to the cloud to ensure the business can function as usual.

The coronavirus outbreak is forcing many organisations to go through digital transformation at a rapid pace. Amazon Web Services, Microsoft Azure and Google Cloud are the obvious beneficiaries as market leaders.

Electronic payments

There has been a long-standing trend where physical cash is quickly becoming a thing of the past. The likes of Visa, Mastercard and AMEX are already benefitting from this.

COVID-19 outbreak could accelerate this trend further. In the short-term, some shops are now only accepting digital payments. The total number of transactions are decreasing, so will revenues. But in the long-term it could force customers into adopting digital payments.

Video content platforms

Video content platform like Netflix, Hotstar, Disney+, Prime Video, Sony Liv, Youtube etc. are witness increased adoption from new users. Existing users are also engaging more and consuming much more content because of the
lockdown.

This is a period where new habits will develop and these platforms will benefit in the long run.

Online grocery delivery

With the rush on supermarkets persisting due to the lockdown imposed in the country, online grocery delivery companies like Grofers, Big Basket, Dunzo etc. are seeing a surge in popularity. Food tech startups like Swiggy, Box8 and Zomato are also delivering essential groceries to counter a dip in their food demand.

Home fitness

One-third of world population has come under lockdown and is partially completely stuck in isolation at their homes. Here is the trend of searches pertaining to it.

There’s no doubt that recessions are bad for business. Yet, at the same time, some of the best-known companies around have their roots in those tough economic times. GE, IBM, GM, Disney and Microsoft were all founded during
tough economic environments and have thrived inspite of that.

Hence it’s likely that even during today’s economic slowdown, some of tomorrow’s biggest companies are just getting their start.