Agritech

Agritech Startup Greenikk Winds Down Operations, Plans to Return Partial Capital to Investors

• ByStartupStory     |    October 1, 2024

Greenikk, a digital ecosystem provider focused on banana farmers, announced on Monday its decision to wind down operations and return partial capital to investors. The company cited issues of defaults within the agriculture sector as a significant reason for this difficult choice.

In a press statement, Greenikk disclosed that it had extended loans worth ₹6 crore, a majority of which had gone into default. The team spent nearly six months on the ground to collect about 80% of the receivables. “Huge receivables were stuck from certain clients as they resisted paying after reaching a significant amount,” the company stated.

Greenikk acknowledged its missteps, noting that it “chased wrong metrics to scale after raising low-interest capital at a time when agritech was at a peak.” The startup also faced challenges in raising its next funding round, a Series A planned at $5 million, and expressed doubts about 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,” the company added.

Founded by Fariq Naushad and Previn Jacob Varghese, Greenikk raised ₹5.04 crore in a pre-seed funding round led by 9 Unicorn Ventures in January 2023. Other participants included Smart Spark Ventures, Manish Modi of Mastermind Capital Ventures, Saurabh Agarwal and Mayank Tiwari of Reshamandi, and Arjun Pillai.

As part of the winding-down process, Greenikk is offering a two-month severance package and job placement assistance to almost 25 employees. The startup had established Enablement Centres (EC) to support farmers with financial services, seeds, crop advisory, insurance coverage, agricultural inputs, and market connections. These centres were located in key banana-producing regions of Kerala, Tamil Nadu, and Karnataka.

Despite the challenges, Greenikk reported impressive growth, achieving a 300% increase in FY 22 with sales of ₹1.58 crore. The founders shared that the startup is projected to end the FY 23 financial year at ₹6 crore. Greenikk’s client roster included notable names such as Beyond Snacks (Shark Tank funded), Tierra Foods, Chedda Foods Mumbai, Kozhikodens, Casco Mumbai, Vimala Welfare Centre, and Reshamandi.

Follow Startup Story