Indian agri-foodtech sector sees major funding decline; reverting to pre-pandemic levels
Funding figures for the agri-foodtech sector in 2023 are close to the $1.3 billion raised in the pre-COVID year of 2019, indicating a return to more typical market conditions following a phase of inflated valuations.
Funding in the Indian agri-foodtech sector witnessed a significant decline last year compared to the previous year, falling to levels similar to those before the pandemic, India AgriFoodTech Investment Report 2024, released by AgFunder and Omnivore, highlighted.
According to the report, agri-foodtech startups in India secured $940 million in funding, marking a 60% decrease from the $2.4 billion raised in 2022. This decrease mirrors the global downturn in agri-foodtech investments, which experienced a 50% annual decline in 2023.
The report noted that funding figures for 2023 are close to the $1.3 billion raised in the pre-COVID year of 2019, indicating a return to more typical market conditions following a phase of inflated valuations.
“What we see unfolding before us is the return of realistic valuations that reflect the operational and financial achievements of the companies,” said Mark Kahn, Managing Partner of Omnivore, which invests in South Asian companies focused on agriculture and food systems.
It highlighted that despite a nearly unchanged total deal count of 129 in 2023 compared to 133 in 2022, there was an increase in early-stage deals, suggesting ongoing investor interest, albeit at diminished valuations relative to previous years.
The median deal sizes decreased by 50% in the early stages (seed and Series A), 39% in the growth stages (Series B and C), and 89% in Series D and beyond stages. Numerous late-stage startups secured follow-on bridge capital, leading to reduced deal sizes in the segment in 2023.
In the same year, e-grocery received $420 million—down 46% year-over-year—making it the top-funded category. Agribusiness marketplaces and fintech—the second-highest funded category—saw a steeper decline of 62% to $162 million.
Together, they accounted for 62% of the capital raised in 2023. The largest downstream deal was ’s Series E funding round of $200 million.
The report also highlighted a worrying trend of limited involvement from agrifood investors, with Omnivore being one of the few remaining, alongside generalist and climate-focused venture capitalists.
“Like 2023, this year will be a great vintage year to invest in promising startups, especially for founders who are building differentiated and unit economically viable businesses from the beginning,” Kahn remarked.
Edited by Suman Singh
