Agritech Greenikk shuts down, returns partial capital to investors

Agritech startup Greenikk on Monday said that it is shutting down operations due to funding challenges and adverse market conditions.

Greenikk had raised around $1 million in total capital from the likes of 100 unicorns (9unicorns), IIM A ventures, Mastermind Capital, Smart Sparks and other angels such as Mayank Tiwari of ReshaMandi.

“We picked up capital during 2022 times when low-interest capital was available and while agri tech was at its peak, we chased the wrong metrics to grow and scale up. The industry dynamics changed making it difficult to raise the next round of Series A round which was planned to be $5 Million,” said Fariq Naushad, co-founder of Greenikk.

As per the company, it’s returning partial capital to investors.

Naushad also highlighted the challenges of defaults in the agri sector.“Stakeholders are not paying back the loans, we extended loans worth Rs 6 crore for which we faced defaults. Huge receivables were stuck from certain clients as they resisted paying after reaching a significant amount. We spend almost 6 months on the ground to collect 80% of the receivables,” said Naushad.

Defaults and collections have become a significant challenge in the agri-tech sector. ReshaMandi, once a prominent player in the space, faced difficulties in collecting receivables, which ultimately led to its downfall. The company struggled with high defaults and mounting liabilities, which forced it to shut down. 

According to Greenikk, it will provide 2 month severance and job offers via reference to almost 25 employees while the founders (Naushad and Previn Jacob Varghese) are looking at exploring their next phase of entrepreneurial life.

Check Greenikk’s shareholding and financials at TheKredible.

After a significant fundraising boom in 2021 and 2022, agritech startups are now facing challenges in attracting venture capital for larger funding rounds. Data compiled by TheKredible reveals that agritech startups raised around $150 million across more than 30 deals in 2024 so far. Notably, there were no deals in the agritech space in September. For comparison, these startups secured $636 million in 2021, which increased to $772 million in 2022. However, the sector saw a sharp decline in 2023, with funding dropping to just $178 million.