The role of tech in the Agri sector

Welcome back to part 4 of this series. In today’s episode we discuss the importance of technology adoption in the Agri tech sector and how behavioural change plays a large role in the farmer community when it comes to leveraging tech. This episode is part 4 of a 5 part series on the Indian Agritech ecosystem, with insights from Thirukumaran Nagarajan, co-founder of Ninjacart, Shashank Kumar, Founder & CEO, DeHaat, Karthik Jayaraman, Co-founder of WayCool and Shobhit, Co-founder of VeGrow. The conversation was moderated by Ankush Goyal, Sanjot Malhi & Tarun Davda who look over the investments in the agri-tech sector for Matrix Partners India.

Shashank:

I think it’s not about integrity it’s more about the transparency, it’s more about having transparency across the supply chain.

Agri in India is not a new sector, at least to any agri-tech startup irrespective of their model whether it’s back-end, front-end, lending, creating market that’s not a problem, that is something which has been existing. So then the important factor is the behavioral change, that’s the important thing. And whichever technology interface you all are building I think that’s one thing we always aspire that by using these interfaces what sort of behavioral change we can bring.

For example, in our case I still remember during our early days like in some area of Bihar we encouraged farmers to grow baby corn. They have never grown baby corn however they have been growing corn. And in the evening I told them that, hey, so early morning 5 am, 4 am you have to harvest because we’ll be sending our truck. And then at 3.30 am the guy called me again, sir, are you sure we need to harvest, right, because the baby corn looks very small and they have been growing corn. So it’s simple things, right, and I know I can go on and on, most of the farmers across India when it comes about irrigation they go for flood irrigation and then submit that it helps your plants to grow, however that’s not the right way.

You can customize your extent of irrigation depending upon your crop, depending upon soil moisture, multiple things. So it’s all about the behavioral change. And I think that’s where in our case again when in case of DeHaat like we always remain closer to the farmer and that’s where the focus is. I think having multiple touch points really helps because it’s the same network of farmer you’re being with throughout the year, round the season, not for a specific crop, not for a specific services, so there was a consistency in terms of touch points.

You’re helping the certain network of farmers to get best source of agri input, you’re also advising them, you’re also helping them to sell their produce, lot of information. And I think because of that this behavioral change now could be seen in our model. I’m sure like in case of let’s say Waycool and Ninjacart of course I mean to the same retailer or kirana if they’re serving the consistency is something that I’m sure which really might have helped them to ensure this behavioral change. And, yes, the problem we all are solving I believe is transparency because the sector it has got a long tail and because of the long tail the industry holds bunch of inefficiencies. And this transparency can be brought by technology and ultimately the technology has to be used by the farmer, by our operator, by our collection center operator or maybe our truck driver and that’s where behavioral change is important.

Ankush:

Shashank, you spoke about behavioral changes and you spoke about the processes need to be in place to ensure that the supply chain is running steady, when you say that the technology adoption in happening for a supply chain and to Sanjot’s point - technology adoption in India is something which is underlying the entire disruptions happening in agri – could you talk about which are the stakeholders that are adopting these technologies ?

Shashank:

So if we map the entire value chain, Ankush, which starts from farmers and ends at let’s say consumer so at somewhere in the mid of the value chain again that’s my belief and observation that people who are working at let’s say wholesale level or people who are working at agri level, people working at let’s say even on the logistic at that level this technology adoption is very advanced now, so that’s not the challenge.

For example, in our case we have been creating our own last mile network where we have close to 1000 micro entrepreneurs now. At least now all micro entrepreneurs in fact they are very much comfortable with technology and that’s where you’re getting the scalability. So between farm to consumer or between farm to businesses I would say like in the middle of the value chain where we have some sort of aggregated kind of people maybe at input, output or whatever I think at that level the technology adoption has already happened.

At farmer levels I believe that it’s still a bit early. Smart phone penetration that’s not the right matrix to look at because most of the farmers have smart phone now but still for them it’s a device to make call and to receive call or maybe to use Facebook and Whatsapp probably. I mean most of the farmers across India they have been using app but again when it comes to the transaction they prefer to call you. So I think the technology adoption at farmer’s side that’s yet to happen but the good part is that yes, the way how smart phone penetration and the data penetration that’s increasing. You already said in the beginning of the call, yes, we started our journey in 2007. At that time in fact all farmers didn’t have a mobile phone versus that at least the silver line or the positive aspect is that at least now each and every individual farmer they have a mobile number at least and they all are very comfortable with the feature phone calls, IVRs.

On app, on payment gateway I think that is something which is yet to happen but we are seeing a very clear trend when UPI and gateways all those things are getting strengthened and we believe that again and that’s another reason why agri-tech startups in general in India is kind of is mushrooming up because the entire industry is working in that direction.