Social-impact investor Menterra Venture Advisors on Tuesday said it has led a funding round in FarmFolks Agro Pvt. Ltd, which advises farmers and sells their fruit and vegetables to retail chains.
Artha Venture Challenge, a social-impact investment initiative of the Singh Family Foundation, also participated in this round, early-stage investor Menterra said. However, it did not disclose the size of the investment.
Menterra typically invests $0.15-0.6 million in firms, according to VCCEdge, the data research platform of News Corp VCCircle.
Bengaluru-based FarmFolks, which was founded in 2015, will use the funds to invest in infrastructure and expand reach.
The startup procures 900 tonnes of fruit and vegetables per month from its associate farmers and delivers the produce, free of pesticide residue, to retailers such as Star Bazaar, Bigbasket, Namdhari Fresh, Nature’s Basket, Grofers and More.
The company said it uses advanced technology for supply-chain tracking to ensure a consistent supply of fresh produce.
"We are working towards getting our farmers to meet global benchmarks. We are also organising separate groups of organic growers to bring them under organic certification," said Lakshmipriyan V G, founder of FarmFolks.
Lakshmipriyan V G was earlier associated with Bharti Walmart India, a joint venture between US-based retail giant Walmart and India’s Bharti Enterprises. The venture was called off in 2013.
AB Chakravarthy, principal, Menterra Venture Advisors, said that with growing awareness around fresh fruit and vegetables free of pesticide residue, the demand will continue to increase.
“This is the right time for the fruit and vegetables’ sector to evolve along the lines of White Revolution triggered by Amul, with consumers getting quality products and producers getting fair price and market access,” he added.
FarmFolks is not the only agricultural startup to have raised fresh funds. In April, AgNext, an agri-analytics startup focused on horticulture and plantation crops, raised an undisclosed amount of funds in a round led by social-impact firm Omnivore.
Menterra had marked the final close of the debut fund at Rs 50 crore ($7.74 million) last year, overshooting the Rs 40 crore target set during its January 2016 launch.
The fund has made four other investments in online learning startup Math Buddy, skill development platform Leap Skills Academy, medical-technology firm Biosense Solutions and ed-tech startup Curiositi.
In March, Menterra managing director Mukesh Sharma had told VCCircle that a sizeable portion of the debut fund had already been committed for investment in firms and the entire fund should be deployed by the end of the next financial year.
*The story has been corrected to reflect that FarmFolks Agro Pvt. Ltd procures 900 tonnes of fruit and vegetables per month from its associate farmers, and not 900 million tonnes as wrongly stated in an earlier version of the copy.