Sayurbox, the Indonesian e-grocery platform, has secured $120 million in a funding round led by Alpha JWC Ventures and Northstar.
The company plans to use the funds to scale up its digital platform and forge direct relationships with farmers.
Indonesia is the country with the fastest growing food market in Southeast Asia.
However, although its agricultural sector is a major component of the economy that also employs some 33 million farmers, it is facing challenges ranging from logistical barriers to the many intermediaries along the agricultural value chain.
Farming direct allows Sayurbox to make inroads into traditional supply chains by cutting out middlemen, and in return provides farmers with consistent demand and ordering planning, as well as better and more stable prices.
“Sayurbox was founded with a social mission to provide market access to local farmers through digitising the Indonesian agricultural supply chain,” Sayurbox co-founder and chief executive Amanda Susanti said.
“The system and ecosystem we developed allows us to have full visibility of our entire agricultural supply chain.”
IFC, the World Bank’s private sector lending arm, provided $10 million of the funds.
The agency said Sayurbox could help farmers across Indonesia benefit from higher incomes and better access to a market currently valued at $120 billion per year.
Sayurbox currently serves around one million customers in Java and Bali with more than 5,000 agricultural products, from fresh produce, meat and poultry to ready-to-eat foods.
Even though the platform is now working with more than 10,000 farmers, Sayurbox seeks to increase it to 40,000 farmers by 2024.
“Upgrading a digital platform like Sayurbox can make a huge contribution to unlocking market and financial access and increasing prosperity for millions of farmers through increased cash flow and higher SME penetration rates,” said Azam Khan, IFC country manager for Indonesia and Timor-Leste.
“Digitalization is a key pillar of our strategy and is now a real driver of change in the post-Covid-19 business environment.”
The investment will help Sayurbox develop digital technology to improve supply chain efficiency and is expected to have a positive impact on crop losses in Indonesia which are estimated at nearly 50%.
- George Russell