India's fruits and vegetables platform Sahyadri Farms raises €40m growth capital to support smallholder farmers
India's integrated platform for fruits and vegetables Sahyadri Farms has raised €40 million growth capital from a group of impact-focused investors; Incofin, Korys, FMO and Proparco, to help farmers run their businesses in a more profitable and sustainable way.
India is a country with an aspirational, young population (74% of the population is younger than 45 years) focused on enriching their lives through hard work and entrepreneurship. At the same time, the country faces challenges like inequality (gender, education, family wealth), outdated technology, inefficient supply chains, and lack of access to capital. The country is witnessing a strong movement towards entrepreneurship to help solve these multidimensional problems the country faces.
Sahyadri Farms is a good example of rural entrepreneurship providing end to end solutions to small and marginal farmers. In 2010 a group of 10 farmers took the initiative to collectively produce and export fresh grapes to Europe. That initiative has grown into the leading fruits and vegetable export and processing company that Sahyadri Farms is today, servicing over 18,000 farmers, covering more than 31,000 acres and 9 crops. The company walks with its farmers from their choice of crops to the farming practices they employ, from the inputs they use to how they harvest and sell their agricultural products. The company for example offers a digital platform that informs farmers on high yield crop varieties, farm inputs, real time climate information and access to the market place.
The economic and social impact of Sahyadri for these farmers is significant. Namdeo Pawar is one of them: “In 2012, I was on the verge of selling my land. Sahyadri supported me, helped me get back up, and I pushed myself to return to work. Trough Sahyadri, my income increased. In 2014, I even repaid my bank loan.” Also for farmer Anil Dawre working with Sahyadri Farms brought about a turnaround: “I farm on less than one acre, because a part of my land is taken up by my home and an animal shed. Group farming turned out to be a success. My parents never imagined their son’s produce would travel abroad. Their joy knows no bounds.”
The capital coming from Korys, FMO, Proparco and Incofin is intended to further grow the farmers' companies. Sahyadri Farms wants to expand its processing capacity for fruits and vegetables-based products, set up a biomass plant to generate electricity from process waste and enhance its infrastructure, like packhouses.
Vilas Shinde, Founding Farmer and Managing Director, Sahyadri Farms: ''The idea of Sahyadri Farms is to unite farmers and make them think like professional entrepreneurs. We are building a sustainable, scalable, and profitable organization for all our stakeholders by making farming profitable and viable activity for each small and marginal farmer.''
Michael Jongeneel, CEO, FMO: ''We are very happy to have found a long-term partner in Sahyadri Farms to support smallholder farmers in India. We are impressed by Sahyadri Farms’ ability to identify and deliver exactly the help farmers need to make their business flourish. We expect this first international equity investment in a farmer-led organization in India to help Sahyadri Farms reach even more farmers and set a blueprint for further growth in the industry.’''
Alpen Capital acted as exclusive strategic advisor to Sahyadri Farms for this transaction.