[Funding alert] Lightbox leads $32M investment in agritech startup WayCool Foods

Chennai-based startup WayCool, which works with 40,000 farmers across the country, will use the funds to strengthen its technology backbone.

Friday February 07, 2020 , 3 min Read

Chennai-based Waycool Foods, an agritech startup working to improve food supply chain and farmer livelihood, has raised $32 million in a combination of equity and debt in its Series C round. The round was led by Lightbox and saw participation of FMO, the Dutch entrepreneurial development bank, as well as its current investor, LGT Lightstone Aspada.

The company has also partnered with InnoVen Capital to raise venture debt as part of this round.

Karthik Jayaraman, Co-Founder and CEO, WayCool Foods, said,

“Lightbox’s deep experience in technology and brand building will greatly help us as we strengthen our digital backbone, and our move into value-added products. FMO’s guidance will be of essence in building a culture of impact orientation across the organisation and staying true to the course.”

The startup said it will use the funds raised to automate its supply chain and build the next layer of data analytics required to strengthen supply chain efficiency. It will also develop and expand its range of value-added products to enterprise and retail customers.

Karthik Jayaraman, Co-Founder and CEO, WayCool Foods

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WayCool Foods procures, processes and distributes a wide range of food products including fresh produce, staples and dairy products, moving over 250 tonnes of food every day to 8,000 enterprise clients across Southern India. The company operates a soil-to-sale model, engaging deeply with a base of nearly 40,000 farmers to improve farm income, while bringing efficiency through its direct supply chain model.

WayCool is developing a range of branded products and currently has brands such as Freshey’s, Kitchenji, Madhuram, and Shuddha.

Prashant Mehta, Partner at Lightbox, added,

“We’re thrilled with the achievement and the focus WayCool has on leveraging technology to solve the massive challenges in the food supply chain. We look forward to working with them and positively impacting the livelihood of farmers and build a long-term sustainable business.”

WayCool will also deploy its funds to deepen and widen ‘Outgrow’, its agricultural extension programme. The startup had recently announced the set up of its first Agricultural Research Station, where it will collaborate with multiple startups to bring the most relevant production technologies to its expanding farmer base.

Linda Broekhuizen, Chief Investment Officer at FMO, said,

“The company leverages technology and innovative concepts to improve logistics and distribution services. Therefore, value chains are optimised thereby realising reduced food waste. The company is also highly impactful on the social side as it sources its produce from over 35,000 smallholder farmers that benefit from higher prices and improved yields. In addition to this, it provides employment to over 900 people. This is FMO’s first agritech deal under the new Ventures Program, which focuses on fintech, off-grid energy, and agritech.”

Founded in July 2015 by Karthik Jayaraman and Sanjay Dasari, WayCool intends to accelerate its path to profitability and will focus on maintaining as well as further improving its lean, capital-efficient model.

WayCool has previously raised two rounds of funding from Aspada, LGT Impact Ventures, Caspian Impact Investment, and Northern Arc Capital Ltd.

Veda Corporate Advisors was the exclusive advisor to the transaction.

Lightbox is a Mumbai-based venture capital firm that builds consumer technology businesses and has raised a total of $400 million. Its recent investments include Dunzo, Bombay Shirt Company and Nua. It has also invested in Rebel Foods, Melorra, Embibe and other brands and tech-enabled businesses.

(Edited by Evelyn Ratnakumar)