Indonesia’s fledgling agritech sector continues to entice investors who are willing to commit large sums of capital. The five-year-old startup TaniHub announced on Friday that it raised USD 65.5 million in a Series B round led by MDI Ventures, the VC arm of state-0wned firm Telkom. BRI Ventures, Intudo Ventures, Openspace Ventures, Tenaya Capital, and Vertex Ventures also participated. In its earlier funding round in April 2020, the firm bagged USD 17 million.
“TaniHub Group aspires to narrow the gap between the prices that Indonesia’s 40 million small farmers receive for their produce and the price that consumers pay for the same food,” said CEO Pamitra Wineka in a statement. The company aims to ramp up harvest collection and processing facilities and help lift exports for Indonesian agricultural goods by working with several ministries related to the sector.
TaniHub’s services comprise e-commerce, logistics, and financing for the country’s agricultural sector. Its e-commerce platform connects farmers directly to business consumers such as hotels, restaurants, caterers, or street food vendors. TaniSupply runs six warehouses and processing facilities that seek to shorten product handling. TaniFund provides loans to farmers using its own credit scores based on performance data from other platforms. In 2020, the company grew its revenue by 7x, added 30,000 smallholder farmers, and disbursed over USD 6 million in loans.
Around 34.6 million Indonesians worked in the agricultural sector in 2019, making up 27% of the country’s workforce. The industry accounts for 3.5% of exports and 5.8% of imports, according to a report from market research firm Emis. Despite its large footprint, the market has traditionally been highly fragmented, with farmers restricted to selling in their local area and long, inefficient supply chains of middlemen and traders. This reduces profits for farmers, increases prices for buyers, and leads to massive food waste, the company said.
Elsewhere, aquaculture startup eFishery received funding from notable investors such as Gojek-backer Northstar Group in August, while fisheries platform Aruna raised capital from SMDV, East Ventures, and AC Ventures. Chilibeli, a social commerce app that connects farmers and manufacturers to online shoppers, closed a USD 10 million Series A round led by Lightspeed Venture Partners.