Omnivore Partners buys minority stake in Eruvaka Technologies
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This is Omnivore Partners’ seventh investment in the country and its first transaction in the aquaculture industry. The companies did not specify how much stake has been diluted for what sort of valuation.
Founded in October 2012, Vijayawada-based Eruvaka Technologies has developed a solar-powered product that integrates sensors, mobile connectivity and decision-making tools to monitor aquatic farms. The product allows shrimp and fish farmers to monitor their ponds and remotely control automated equipment such as aerators and feeders.
The product significantly reduces cultivation risk. With cloud-based technology, a farmer gets information on his handset.
“More than 75% of our predictions and warnings are correct,” said Sreeram Raavi, founder and managing director of Eruvaka Technologies, who is an electronics engineer by training.
The patented Floating Sensor Buoy floats in a pond and does not need human intervention. It costs Rs.30,000 with an additional annual service fee of Rs.1,500. Eruvaka Technologies has been selling it across coastal Andhra Pradesh since May 2013. The company is planning to expand to other regions in India and is also exploring opportunities to sell it in South Asia and South-East Asia.
In India, around 165,000 hectares is currently under aquaculture cultivation and there is potential for 1.19 million hectares of viable aquaculture in the country, Omnivore estimates. Aqua cultivation is mainly concentrated in Andhra Pradesh, Gujarat, West Bengal, Odisha and Tamil Nadu. Seafood exports in fiscal year 2012-13 reached $3.5 billion, growing 23% from a year earlier. Shrimp comprised 24.6% on a volume basis and 49.6% on a value basis, Omnivore estimates.
“We want to capture 10% of the Indian market in the next two years. We will use the capital raised to hire a sales force and increase our reach. We will invest in research and development for creating new products, including optimization of seed consumption,” said Raavi.
Omnivore Partners, which focuses on investing in agriculture and food technology companies in India, sees a large opportunity in the aquaculture space. There is a lucrative opportunity in aquaculture not just because it is export-oriented, but also because it is one of the fastest growing subsets in agriculture, said Mark Kahn, a founding partner at Omnivore Partners. World over, nearly 50% of seafood is farmed.
“It’s a very unique technology combining cloud with mobility for aqua farming. The product has market not only in India, but across the globe and can scale massively,” said Kahn.
In India, Omnivore Partners has invested in Skymet Weather Services Pvt. Ltd, a weather forecasting and agriculture risk solutions company; Khedut Agro Engineering Pvt. Ltd, a manufacturer of automatic seed drills and innovative planting machinery; and FrontalRain Technologies Pvt. Ltd, which offers cloud-based supply chain software for agribusiness and food processing companies, among others.
With farmers adopting mobile technologies to switch on water pumps, it’s clear that any service which helps them boost their yield will find buyers, experts say.
“Farmers are open to new technologies and it’s a no-brainer for investors that it’s a very attractive space. For us, the issue is that we don’t come across such opportunities every day,” said Anil Joshi, president of Mumbai Angels, a network of investors.