Driving Investments into Innovative Ag-Tech GFIA, February 2018

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OVERVIEW: OMNIVORE

Omnivore invests in Indian startups developing breakthrough technologies for food, agriculture, and the rural economy.

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OVERVIEW: OMNIVORE IMPACT

Omnivore defines itself as a “financial first”

impact fund. Omnivore seeks to deliver

market rate returns for investors, comparable

to other venture capital funds in India.

At the same time, by investing exclusively in

technologies for food, agriculture, and the rural

economy, Omnivore impacts the lives of

farmers and rural communities across India.

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GLOBAL TRENDS: FOOD & AGTECH INVESTMENT

0.5 0.5 0.9

2.4

4.6

3.2

2011 2012 2013 2014 2015 2016

Annual Financing for Food & Agriculture Technology (USD Billion)

•  According to AgFunder’s “AgTech Investing Report”, USD 3.2 billion was invested in food & agriculture technology companies in 2016

•  These funds were deployed into 580 companies by 670 unique investors

•  The 30% drop in funding from 2015 levels reflected declines in bioenergy, drone technology, and food delivery investment

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GLOBAL TRENDS: FOOD & AGRICULTURE TECHNOLOGY

Genetics (Seeds, Traits)

Sustainable Inputs

Innovative Food

Big Data

Precision Agriculture

Trend Drivers •  Yield pressure •  Abiotic stress •  Bioenergy

•  Pesticide resistance •  Soil degradation •  Organic boom

•  Mobile revolution •  Cloud computing •  Climate change

•  Healthy CPG •  Meat substitutes •  Food delivery

•  Farm automation •  Internet of Things •  Vertical farming

Leading Startups

Notable Exits

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Global production (FAO*) rank by commodity: -  Milk 1 -  Pulses 1 -  Spices 1 -  Rice 2 -  Wheat 2 -  Cotton 2 -  Sugar 2 -  Fruits 2 -  Veg 2 -  Tea 2 -  Rubber 4 -  Oilseeds 5 -  Coffee 5

INDIA CONTEXT: AGRICULTURAL ECONOMY

Only major commodity imports are edible oil and pulses

Average farm size ~1.3 hectares

Agriculture represents 17.4% of India’s GDP

48.9% of India’s population works in agriculture

Key exports include cotton, sugar, buffalo meat, basmati rice, seafood, maize, coffee, tea, and spices

* The Food and Agriculture Organization of the United Nations (FAO)

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INDIA CONTEXT: FOOD & AGRICULTURE VALUE CHAIN

Farm Inputs

Land & Farming

Storage & Trading

Agriculture Processing

Distribution & Retail

Upstream Midstream Downstream

•  Seeds •  Fertilizers •  Agrochemicals •  Machinery •  Irrigation

•  Crops •  Livestock •  Horticulture •  Aquaculture •  Plantations

•  Storage •  Logistics •  Trading •  Marketing •  Financing

•  Wholesalers •  Retailers •  Supermarkets •  Restaurants •  Foodservice

•  Food •  Feed •  Fodder •  Fiber •  Fuel

Examples of leading Indian companies

•  Kaveri Seeds •  Tata Chemicals •  Jain Irrigation •  Mahindra

•  Suguna Poultry •  Sula Vineyards •  APPL •  VH Group

•  Star Agri •  NCML •  Snowman •  NCDEX

•  Future Group •  Spencer’s Retail •  Café Coffee Day •  Jubilant FoodWorks

•  Hatsun Agro •  Godrej Agrovet •  Britannia •  Dabur India

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STRATEGY: OMNIVORE INVESTMENT THESIS

DEMAND

•  Rising incomes transforming Indian diets -  shift from

grain-based to protein-based

-  rapid growth of processed foods, eating outside home

•  Consuming more vegetables, fruits, sugar, dairy, pulses, edible oil, and meat/fish/eggs

•  Trend will continue for the next decade, similar to China & SE Asia

SUPPLY

•  Multiple bottlenecks limiting food production -  land, soil, climate,

water, labor, logistics •  Arable land urbanizing •  Soil quality degrading •  Crop yields stagnating

from climate change •  Water table collapsing •  Labor costs skyrocketing

(NREGA, migration) •  Logistics system failing;

massive food wastage •  Companies that solve key

bottlenecks will transform Indian agriculture

ECOSYSTEM

•  Agri-Food-Rural tech startup activity leveraging India’s unique strengths

•  Expertise in IT (software & hardware), biotech, pharma, auto engineering

•  Deep pools of technical & managerial talent

•  Domestic agribusiness industry with global leaders in tractors, irrigation, agrochemicals, seeds, food processing

•  Strong universities (IITs, IIMs, SAUs) and research institutes (ICAR, CSIR)

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STRATEGY: OMNIVORE THEORY OF CHANGE

Increasing Profitability

•  Raising farm yields

•  Reducing farm expenditures

•  Securing better prices for farm outputs

Improving

Sustainability •  Reducing

consumption of natural resources

•  Minimizing wastage and spoilage

Reducing Farmer

Uncertainty •  Providing access to

innovative finance, risk management solutions, steady or augmented sources of income, and improved market dynamics

Helping Smallholder Farmers Overcome Poverty Three Drivers of Change

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STRATEGY: INDIA AS SMALLHOLDER LABORATORY

Country Average Farm Size (ha)

India 1.3

Nepal 0.8

Indonesia 0.8

Myanmar 2.5

Vietnam 0.7

Ethiopia 1.0

Tanzania 2.4

Source: FAO

•  India has potential to become an innovation hub for smallholder agriculture globally -  subcontinent includes every major

agro-climatic zone •  “Laboratory” to develop, pilot, and scale up

products & services with export potential to other regions dominated by smallholders

–  South Asia –  Southeast Asia –  Sub Saharan Africa

•  Challenge of innovating for smallholder farmers globally plays to India’s strengths

–  frugal engineering –  small scale mechanization –  lean IT (mobile & cloud centric)

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STRATEGY: FOCUS SECTORS FOR INVESTMENT

•  Digital platforms, Big Data solutions

•  Precision agriculture, Internet-of-Things

•  Remote sensing, UAVs, farm automation

•  Sustainable inputs for smallholder famers

Innovative Food

Rural Livelihoods

Agricultural Technology

•  Branded products, novel ingredients

•  New food processing technologies

•  Value chains linked to smallholder farmers

•  Traceability, food safety, and nutrition solutions

•  Water management (irrigation, monitoring)

•  Financial technology for smallholder farmers

•  Off-grid power solutions (generation, efficiency)

•  Storage technologies, supply chain tools

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TRACK RECORD: CASE STUDY #1

Overview Skymet Weather Services is India's leading provider of risk solutions for weather and agriculture

Investment Date August 2011 Omnivore Investment USD 2.2 million in equity Ownership Stake 25.7% Co-Investors DMGT, The InsuResilience Investment Fund

Business Background

-  Skymet’s network of Automatic Weather Stations (AWS) is India’s largest, enabling accurate weather monitoring and facilitating the growth of agricultural insurance

-  Expertise in agricultural risk solutions, including crop area/yield forecasts, remote sensing, and agricultural insurance product development

-  Launched India’s first consumer weather website (http://www.skymetweather.com) and mobile app

Impact Metrics (FY2016) -  Skymet’s AWS network enabled the settlement of 1.2 million crop insurance claims by farmers in FY2016

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TRACK RECORD: CASE STUDY #2

Overview Stellapps Technologies is India’s first dairy IoT solutions company, building automation tools integrated with cloud, mobility, and data analytics

Investment Date July 2013 Omnivore Investment USD 2.6 million in equity Ownership Stake 34.13%

Co-Investors Blume Ventures, Venture Highway, Binny Bansal (Co-Founder of Flipkart), 500 Startups

Business Background

-  Founded in April 2011 by 5 ex-Wipro executives -  Provides optimization, analytics, and monitoring services

across the dairy supply chain, including production, milk procurement, and cold-chain logistics

-  Customers include commercial dairy farms, cooperatives, and private dairies

Impact Metrics (FY2016) -  Stellapps automated milk collection units (AMCUs) cater

to the needs of 430,000 dairy farmers across six states -  AMCUs process USD 900,000 of farmer payments daily