Agritech startup Greenikk winds down operations, plans to return partial capital to investors
Greenikk cited troubles with defaulting among its stakeholders, difficulty in raising series A and scale issues in its current operating model.
Banana farmer-centric digital ecosystem provider Greenikk on Monday said it is planning to wind down its operations and return partial capital to investors.
In a press note, the company cited issues of defaults in the agri sector as one of its reasons for winding its operation. The company had extended loans worth Rs 6 crore, which were defaulted, and it spent almost six months on the ground to collect 80% of the receivables.
“Huge receivables were stuck from certain clients as they resisted paying after reaching a significant amount,” read the statement.
Moreover, the company noted that it chased wrong metrics to scale after raising low-interest capital at a time when agritech was at a peak. It also faced difficulty in raising the next round of Series A, which was planned to be $5 million, and was doubtful of providing justified returns to its investors with its current model in the agritech domain.
“We may be able to build a low profitable business but justified VC level returns to our investors was not possible,” added the company.
The company, founded by Fariq Naushad and Previn Jacob Varghese, had raised Rs 5.04 crore in a pre-seed round led by 9 Unicorn Ventures in January 2023. The round also saw participation from Smart Spark Ventures; Manish Modi of Mastermind Capital Ventures; Saurabh Agarwal and Mayank Tiwari of Reshamandi; and Arjun Pillai.
The Thiruvananthapuram-based company said it is winding down after giving two month severance and job offer via reference to almost 25 employees.
Greenikk had built Enablement Centres (EC) to provide farmers with the required support such as finance, seeds, crop advisory, insurance coverage, agri inputs, including weather tips, and market connect. It had ECs in some of the major banana producing agri belts in the country such as Kerala, Tamil Nadu, and Karnataka.
It grew 300% in FY 22, with sales of Rs 1.58 crore, and Founders shared that the startup is projected to end FY23 financial year at Rs 6 crore. It counted clients like Beyond Snacks (Shark Tank Funded), Tierra Foods, Chedda Foods Mumbai, Kozhikodens, Casco Mumbai, Vimala Welfare Centre, and Reshamandi.
Edited by Megha Reddy