Agri Venture

8/6/2019 Agri Venture

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Venture Funding Opportunitiesin Agriculture Sector

March 10, 2011


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TABLE OF CONTENTS

Omnivore Capital Overview

Agriculture in India

Why Ag-Tech?

Investment Strategy

Omnivore Team

Strategic Advisor: Godrej

Fund Terms

Contacts


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OMNIVORE CAPITAL OVERVIEW

Omnivore Capital is an early stage venture capital fund investing in

agricultural technology (ag-tech) startups in India

planned fund size of Rs 250 crore

investing primarily in Series A and Series B rounds

select few Seed investments

Focused on entrepreneurs and scientists who are innovating solutions

to improve agricultural productivity and sustainability

Godrej, one of Indias oldest and most trusted business conglomerates,

is the Strategic Advisor to Omnivore Capital


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GLOBAL FOOD SYSTEM UNDER SEVERE STRESS

Source: FAO


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RUNAWAY FOOD PRICE INFLATION ALSO HITTING INDIA

Government of India: Wholesale Price Index (WPI), April 2006 = 100

Source: Office of the Economic Adviser, Government of India

80

100

120

140

160

180

200

220

240

260

Apr-05 Oct-05 Apr-06 Oct-06 Apr-07 Oct-07 Apr-08 Oct-08 Apr-09 Oct-09 Apr-10 Oct-10

Cereals

Pulses

Vegetables

Milk

Eggs, Meat, Fish


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SNAPSHOT OF INDIAS AGRICULTURAL ECONOMY

68% of Indian

population linkedto agriculture

Agriculture

represents 17.2%of Indias GDP

Average farm size~1.4 hectares

Largest producerof milk globally

Second largestproducer of fruits andvegetables globally

Among the top fiveproducers worldwideof rice, wheat,oilseeds, sugar,groundnuts, tea,coffee, and spices


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INDIAS RURAL INCOMES RISING, POVERTY FALLING

Indias rural poor (millions)

548614

514

403

263

0

100

200

300

400

500

600

700

1985 1995 2005 2015E 2025E

% of ruralpopulation

96% 90% 65% 46% 29%

Rural poor defined as those with annualHH income of


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3,9315,622 7,147

11,547

17,296

1985 1995 2005 2015E 2025E

AS INCOMES RISE, FOOD CONSUMPTION WILL JUMP

Aggregate rural consumption of food products, Rs billion (FY2000)

Source: MDI India consumer report

3.0%

2.4x4.5%


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-8%

-6%

-4%-2%

0%

2%

4%6%

8%

10%

12%

FY95 FY97 FY99 FY01 FY03 FY05 FY07 FY09 FY11E

WEAK AGRI GROWTH THREATENS FOOD SECURITY

Indian agricultural GDP growth, % y-o-y

Drought years

Source: CMIE


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SHRINKING FARMLAND HOLDINGS BECOMING UNVIABLE

Average size of farm land holdings in India (hectares)

2.7

2.3

1.8

1.61.4

0.0

0.5

1.0

1.5

2.0

2.5

3.0

1961 1971 1981 1991 2002

Source: www.agricoop.nic.in


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INVESTMENTS IN AGRI SECTOR HAVE RAMPED UP

Gross capital formation, % of Agri GDP (nominal)

0%

2%

4%

6%

8%

10%

12%

14%

16%

1995 1997 1999 2001 2003 2005 2007

2x

Source: B&K Research


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BUT INDIAN AGRI YIELDS STILL TERRIBLY LOW

Maize yield (MT/hectare)

9.7

6.55.6

4.1 4.1

2.4

0

1

2

3

4

5

6

7

8

9

10

USA Argentina China Brazil Indonesia India

Pulse yield (MT/hectare)

2.01.8 1.6

1.10.9

0.6

0

0.5

1

1.5

2

2.5

Canada USA China Myanmar Brazil India

Paddy yield (MT/hectare)

6.6

5.24.9

4.03.4

0

1

2

3

4

5

6

7

China Viet Nam Indonesia Bangladesh India

Soybean yield (MT/hectare)

2.8 2.8 2.8 2.7 2.6

1.7

1.0

0

0.5

1

1.5

2

2.5

3

Argentina Brazil Canada USA Paraguay China India

Source: FAO


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INDIA HISTORICALLY UNDER-INVESTED IN AGRI R&D

R&D intensity (R&D spend as % of Agri GDP)

0.3% 0.4%

1.8%

2.7%

3.6%

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

India China Brazil USA Japan

Source: Pray and Basant, 2001, IFPRI research report


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BUT INDIAN FARMERS RAPIDLY ADOPT NEW TECH

Hectares (millions) of cotton in India

0

2

4

6

8

10

12

CY02 CY03 CY04 CY05 CY06 CY07 CY08 CY09

Non-Bt

Bt

Source: www.fbae.org


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PRIVATE SECTOR AG-TECH CAN DRIVE PRODUCTIVITY

Indian cotton production in million bales (170 kg)

Yield(kg/ha)

56747839930826710692

Source: www.cotcorp.gov.in

50 years 10 years


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PUBLIC SECTOR DRIVES INDIAS AG-TECH ECOSYSTEMFunding channels for Agri R&D, FY2000, $ (nominal)

Grants to ICAR($252.4 mn)

Externally aided projects($33.7 mn)

AP cess funds($5.8 mn)

Internal resources($9.2 mn)

Other public sources$2.4 mn

State governments$277.0 mn

Business$69.9 mn

Central government

Grant to ICARinstitutes

$210.2 mn

ICAR schemes$79.9 mn

Competitive grants$10.8 mn

ICAR institutes$239.2 mn

State agriculturaluniversities$332.9 mn

Other public R&Dinstitutes$4.4 mn

Business organizations$73.7 mn

Source: Pray and Basant, 2001, IFPRI research report

Ag-tech in India overseen by Indian Council of Agricultural Research (ICAR)

public sector organization with ~30,000 researchers across 100+ institutes

State agricultural universities (SAUs) also play critical role in ag-tech R&D

ICAR and SAUs only recently began commercializing ag-tech innovations

Huge opportunity to launch startups, bring great technologies to market


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INVESTMENT STRATEGY: FOCUS AREAS

Early stage ag-tech startups in India

Characteristics of successful venture-backed startups

strong team

highly scalable, capital-efficient

differentiation based on technology (IP) or business model

Which focus areas do we like?

plant science, animal science, aquaculture, sustainable inputs

farm equipment, water management, agriculture services

farmer finance, bio-fuels, distributed power generation

rural information services, post-harvest infrastructure


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PREPARING FOR FUND RAISE: BASIC REQUIREMENTS

Entrepreneurs to make a Realistic Business Plan

Detailing the next stage and the path to achieve the same

Skin in the Game

Sharing Ownership and Control

Exit Options for the Investors

Alignment of Interests between Entrepreneurs and Investors

Talk to Investors Directly and be Flexible in Approach

Fund Raising is a long Process Be Patient


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OMNIVORE TEAM

Atish Babu

Partner

Vice President at Nexus Venture Partners, leading Indian VC firm

Vice President (Corporate Development) at Vonage

Investment Analyst with Battery Ventures

MBA from Harvard Business School; BS from Massachusetts Institute of Technology

Mark Kahn

Venture Partner

Executive Vice President (Business Development) at Godrej Agrovet

Strategy Manager at Syngenta AG

Began career as turnaround consultant with PFM

MBA from Harvard Business School (Baker Scholar); BA from Univ. of Pennsylvania

Jinesh Shah

Partner/CFO

Vice President and CFO at Nexus Venture Partners, leading Indian VC firm

Finance Manager at Patni Computers; led M&A, IPO activities

Assistant Manager at HCL; helped start BPO business

Chartered Accountant; MBA from JBIMS; B.Com from R A Poddar College


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STRATEGIC ADVISOR & LP: GODREJ

114 years old (established in 1897)

Largely privately owned by Godrej family

$3 billion sales turnover

21,000+ employees

100 manufacturing locations in India & abroad

Diversified: 6 focal companies (3 publicly traded)

Global operations in 16 countries

Godrej touches the lives of 470 million Indians daily


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With ~1900 employees and total FY2009-10 sales of Rs ~1600 crore,Godrej Agrovet Limited (GAVL) has interests in:

GAVL Mission: to improve the productivity of Indian farmers by innovatingproducts and services that sustainably increase crop and livestock yields

GODREJ AGROVET IS A DIVERSIFIED AGRIBUSINESS

AnimalFeed

Indias largestcommercial feed

miller Market leader in

cattle, poultry, andaqua feed

Bangladesh JVwith ACI

Poultry(Godrej Tyson)

Market leader inprocessed poultry,

frozen snacks Partnered with Tyson

Foods, the worldslargest meatprocessor

Oil PalmPlantations

Largest oil palmcultivator in India,

with 40,000hectares

Operating in AP,TN, Goa, Orissa,Gujarat, Mizoram,and Karnataka

AgriInputs

Market leader inplant growth

regulators,soil conditioners,cotton herbicides

Strong pipeline ofinnovative products


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GODREJ AGROVET VALUE ADDITION TO OMNIVORE

Due diligence capabilities

evaluation by technical experts

ability to conduct field trials

verify investment assumptions with distributors/farmers

Scale up portfolio companies

connect startups to distributors, suppliers, customers

help optimize manufacturing/operations

identify talent from agribusiness industry

Values driven organization

strong regulatory compliance

transparent corporate governance


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THANK YOU FOR YOUR TIME AND CONSIDERATION

THIS PRESENTATION CONTAINS CONFIDENTIAL INFORMATION REGARDING THE BUSINESSAND OPERATIONS OF OMNIVORE CAPITAL AND ITS AFFILIATES AND IS BEING PROVIDEDTO RECIPIENTS ON A CONFIDENTIAL BASIS. THIS PRESENTATION IS FOR INFORMATIONALPURPOSES ONLY AND DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATIONOF AN OFFER TO BUY ANY SECURITIES. ANY SUCH OFFER OR SOLICITATION WILL BE

MADE ONLY PURSUANT TO A CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM.

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