Agri-tech firm WayCool gets Rs 120 cr from LGT and others

Bengaluru: Chennai based fresh produce distribution startup WayCool has raised Rs 120 crore through equity and debt in a funding round. Karthik Jayaraman, cofounder of WayCool, said about 75% of the capital raised was through sale of equity, while the rest was debt.

The investment is part of an ongoing Rs 200-220 crore Series-B round that WayCool plans to use to expand its footprint. The funding round also saw participation from angel investors and institutional lenders such as Northern Arc Capital and Caspian.

“The objective of this fundraise is to further expand our footprint. We currently operate predominantly in southern India and our objective is to further penetrate this market and enter the western market,” said Jayaraman, who is also the company’s CEO. “We also want to invest in value-added products as we currently deal only with raw products.”

The investment is among the latest in the country’s agritech space, which is seeing increased interest from both global and local fund houses.

WayCool wants to invest in growing its technology stack, largely involving integrations with backend of large enterprise customers who it sells to. It is also working on getting more of the small-hold farmers and ‘kirana’ store buyers to get on to its digital platform, to streamline the sourcing and selling fresh produce.

The company, which has an annual revenue run rate of about Rs 250 crore, said it is operating at single-digit negative margins. It hopes to improve this by introducing value-added products such as chopped vegetables, batters and raw fruits and vegetables, which typically yield higher margins. WayCool said it already has specific brands targeting the fresh produce and masalas and marinades markets, but will also expand this portfolio.

“What impresses us most about WayCool is their execution capability,” said Kartik Srivatsa, managing partner at Aspada, which had invested $2.7 million in WayCool as part of its Series A funding in 2017.