Eratani Closes Initial Stage Funding Worth 88 Billion Rupiah
Including additional funding of 30,4 billion Rupiah from SBI Ven Capital with Genting Ventures, Orvel Ventures and Ascend Angles
Startups agritech Eratani announced the acquisition of additional funding of $2 million (approximately 30,4 billion Rupiah) from SBI Ven Capital, through a joint fund with Kyobo Sekuritas and NTUitif, as lead investors in the early rounds that are already underway since last year.
Other investors participating include Genting Ventures, Orvel Ventures, and Ascend Angles. In total, in this round, Eratani raised $5,8 million (around 88,2 billion Rupiah) from a number of investors, namely TNB Aura, AgFunder, BIG Ventures, and Trihill Capital.
Trihill Capital is one of the investors included in the round pre-early stage worth 23 billion Rupiah announced in June 2022.
The company believes that the investments made by investors indicate their optimism and confidence in Eratani's ability to unlock the potential of agritech, while creating a significant social impact.
"This investment not only validates our business model but also echoes our belief in Indonesia's agribusiness potential. We are committed to continuing our work in empowering farmers, increasing efficiency and driving business sustainability in the agricultural sector," said Eratani CEO Andrew Soeherman in an official statement.
SBI Ven Capital CEO Ryosuke Hayashi said, "We strongly believe in the huge potential of Indonesia's agritech sector, and Eratani is in the right position to capitalize on it. Their holistic approach and innovative solutions not only streamline agricultural processes but also create social impact for farmers. We remain confident in Eratani's ability to drive growth and transformation in the agricultural sector."
This startup, which was founded in 2021, provides integrated technology in rice cultivation. Its comprehensive solutions involve farmer funding, supply chain management, crop distribution and agricultural assistance, the solution is end-to-end.
The mentoring program aims to increase the productivity of Eratani's assisted farmers from the beginning to the end of the planting process. This assistance includes checking soil pH, plant care, how to deal with pest attacks, providing quality agricultural production facilities, to distributing crop yields at standardized prices.
The company claims it has recruited 20 rice farmers in five provinces, namely West Java, Central Java, East Java, Banten and South Sulawesi.
In a previous interview with DailySocial.id, Andrew said that there are two main issues faced by the agricultural sector, namely (1) 98% of processes from upstream to downstream have not been digitized and (2) 93% of farmers are still carrying out their own and disorganized business activities.
Based on McKinsey research, as much as 50%-70% of Indonesia's crops never reach the market. It is estimated that the productivity of farmers in Indonesia must increase by 60% if they are to meet the food needs of 280 million people. This can also be realized if farmers are able to increase crop yields, reduce post-harvest losses, so that they can distribute them to big cities.
Potentially, Indonesia's agricultural sector contributes around 13% of GDP and employs almost 29% of the workforce. However, the sector faces significant inefficiencies, including poor logistics and high costs due to middlemen, resulting in reduced profit margins for farmers, especially rice, which involves around 17 million households.
Eratani's innovative solutions aim to streamline the sector making it more efficient and fair, most importantly ensuring farmers benefit directly from their work.