BigHaat co-founders: Sachin Nandwana (second from left), director, Sateesh Nukala (centre), CEO, and Kiran Vunnam (second from right), senior VP. A
Image: Hemant Mishra for Forbes India
fter working with multinational conglomerate Honeywell for 17 years, in 2014, Sateesh Nukala had a midlife crisis. Though he had grown and evolved professionally, the NIT Calicut alumnus felt a sense of void. He decided to quit the company and took some time off to think about what he wanted to do next. This self-discovery journey took him back to his roots. With an intent to give back to the community by utilising his past work experience, Nukala, who hails from Peddapasupula village in Kadapa district, Andhra Pradesh, decided to focus on helping farmers and transform the agricultural value chain with the help of technology.
“My father was a farmer and years later, I realised that I’m a son of the soil too... this is where I belong. I started doing research to find out ways to incorporate tech and innovation to make things easier for farmers. I visited many villages, met the farmers, tried to understand the entire process from pre to post harvest,” says Nukala. Failure of crops, low productivity, and low yield are some of the major problems farmers encounter during the pre-harvest process. Nukala, 45, decided to address these and founded agri inputs marketplace BigHaat in 2015 along with friends Sachin Nandwana and Kiran Vunnam, who also hail from agricultural families.
With decades of technology and product experience behind them, the trio decided to transform the value chain from pre-harvest to post-harvest with a technology-led platform. The Bengaluru-based agritech company leverages data, technology and crop science, and connects quality input manufacturers with the farmers directly through a mobile app, website and missed-call service. It provides stage-wise technical crop advisory services, thereby enabling the farmers to choose relevant inputs at every stage of the crop cycle.
According to reports, the Indian agricultural inputs market includes close to 145 million farmers, spending roughly about $52 billion on farm inputs a year to grow crops. This is expected to grow at a compound annual growth rate of 10 percent with farmers moving towards high-value crops, spending higher on inputs to earn a higher income—this is a $800 billion opportunity cumulatively over 10 years. BigHaat is not alone in this space—besides local retailers, it competes with many agritech companies, including AgroStar, Gramophone and DeHaat, among others.
“In the traditional supply chain, a farmer makes his pre-harvest products purchase based on the inputs given by a retail shop owner, and applies those inputs. A retailer is not someone who can impart the right technical guidance... he’s pushing unwanted inputs and farmers end up buying irrelevant inputs, more inputs, which push the costs higher, reducing the yield and the quality also drops. Yields are much lower in India and every year they are coming down,” says Nukala.
Five years ago, when Netrapal Singh, a farmer from Swami Sehi village in Jhunjhunu district of Rajasthan, couldn’t get quality hybrid papaya seeds at a local shop, he looked online. He found them on BigHaat’s website and ordered them. “I wanted papaya seeds of a particular brand and they were available on BigHaat. I also found many other useful products and information. I have become a regular user of the company. I also order seeds and other products for fellow farmers because all are not well-equipped with technology,” says Singh, who has been farming since 15 years. He claims his production and income have increased after he started using quality products with proper guidance.
Singh orders agri inputs at least thrice a month from BigHaat and other apps.
BigHaat has a team of agronomists to answer farmers’ queries. It uses advisory as a mode of engagement tool to on-board farmers, and encourages them to make product purchases, including seeds, pesticides, fertilisers, nutrients, farm implements etc. Once a farmer contacts BigHaat, the platform gathers several data points around him and starts building his profile, thereby ensuring relevant solutions and products. The company has managed to reach 16,000 rural pin codes with over two million monthly active users on the app and website.
Based on the stage of the crop, the company sends advisory messages and the farmer can discover products specific to his crop. The user can then contact agriculture experts for suggestions or advisory services on how to apply the same on the crop, and what results to expect.
The agritech company has since last year become a full-stack agricultural platform from seeds to market by introducing a technology-led market linkage supply chain solution to organise the unorganised and fragmented agriculture supply chain, which has augmented the company’s growth. The company’s revenue jumped from Rs 17.75 crore in FY21 to Rs 121.58 crore this year.
The company earns from the suppliers listed on its marketplace model. The farming advisory as a service is free. On the other side, BigHaat has also become a platform for various manufacturers to reach a pan-India farmer base with a lower cost of marketing and distribution. BigHaat has partnered with large MNCs like Bayer, Corteva and UPL, along with over 400 brands offering more than 10,000 SKUs (stock keeping units).
During the initial years, it was difficult for the company to convince farmers to use their platform. But with digital penetration in villages, this problem has reduced to some extent. Still, there is a long way to go. Another challenge is the poor rural logistics in rural areas, and there are delays in delivering products. BigHaat is working on resolving this.
The agri digital platform managed to raise its first round of funding 18 months after inception. To date, it has raised a total of $16.1 million in over seven rounds. Their latest funding was a debt financing round in March. BigHaat is funded by six investors, with BlackSoil and JM Financial Private Equity as the most recent investors.
BigHaat is a pioneer in building a strong digital footprint and using technology not at a superficial level but to solve real farmer problems, says Vinit Rai, executive director at JM Financial Private Equity. “We monitored them month-on-month for almost a year before we actually invested in them. Their Crop Doctor feature, where the farmer can upload an image of an infected crop and get unbiased and correct advice, is a game changer. When the farmer is not just a transacting customer of inputs for discount but has engaged and bought it with that level of engagement and ownership, it is a different value proposition,” he says.
Agritech companies that keep their focus on execution each day and respect for capital efficiency have a very long runway for growth, adds Rai. “I feel that a couple of companies should be listed in the next five years or so.”