The last decade has seen Agtech in India go through the complete hype cycle. Almost $5 billion was invested in multiple dreams, driven by the telecom breakthrough of affordable internet in the pockets of most farmers, the rapid adoption of basic smartphone applications, and the penetration of UPI deep into the country. The fever peaked, went through its own trough of disillusionment and hopefully we are entering an enlightened building phase.
A key reason for the disillusionment was the idea of “Disruption”. Entrepreneurs came in with claims of deep inefficiencies in the input and output value chains, based on assessment of how prices increase as goods moved from layer to layer in the value chain.
Disruption to me is synonymous with destruction. Multiple companies were born dreaming of bypassing retailers or distributors or both. Many succeeded in generating and scaling Gross merchandise value. When manufacturers proved reluctant to trust these “platforms” with their lead brands, they opened for wholesalers – formal or informal distributors of companies, to sell. Lower price became the main proposition.
