Agritech Startup Ninjacart has received a commitment of $50 million in funding from retail giant Walmart.
The fresh produce supply chain company will likely receive around $10 million in the first tranche of the funding within a month and give a seat on the Board of Directors to Walmart as part of the deal.
This would be a strategic move by Walmart to achieve backward integration in order to boost its supply needs of fresh fruits and vegetables in India. The company has been operating cash and carry stores under the brand name Best Price Modern Wholesale and Best Price
These stores operate by providing memberships to small scale grocery stores and neighborhood Kirana. It claims to have around 1 million memberships in India.
The markets for fresh fruits and vegetables in India are highly unorganized and operate on ages-old schemes with an utterly complex operational structure. The farmers often don’t get the desired value for their produce. Ninjacart weeds out these pains by employing tech-based solutions in its supply chain.
The Bengaluru based company buys directly from the farmers and through its network of collection centers and distribution hubs, it supplies straight to the retailers. It claims to buy around 1,400 tonnes of produce each day from more than 25,000 farmers and supply to over 50,000 stores across the country.
The global market has an eye on the immense potential the vast farmlands of India posses with a huge scope of modernizing the traditional practices of farming and distribution of agriculture produce.
Ninjacart had raised $90 million in April this year from Tiger Global.
According to an ET report, Wallmart will also have the option to invest further in the supply chain company and gain more control. Although there are not any talks of Ninjacart working with Flipkart’s grocery segment anytime soon, the strategic partnership will surely give the retail giant a strong footing in the fresh produce segment in India.