SUMMARY
- Greenikk announced its decision to shut down operations and return a portion of its capital to investors.
- The company had lent out loans amounting to Rs 6 crore and spent 6 months attempting to recover 80% of the outstanding debts.
- The company announced its closure after offering two-month severance packages and job references to nearly 25 employees.
On Monday, Banana farmer-focused digital ecosystem provider Greenikk announced its decision to shut down operations and return a portion of its capital to investors. In a statement, the company pointed to issues related to defaults in the agricultural sector as a key reason for its decision.
The company had lent out loans amounting to Rs 6 crore, which were defaulted, and spent nearly six months attempting to recover 80% of the outstanding debts.
The statement read, “Huge receivables were stuck from certain clients as they resisted paying after reaching a significant amount.”
Greenikk highlighted that it pursued metrics that led to unsustainable growth following the issuance of low-interest funding at a time when the agritech sector was booming. It also faced obstacles in securing funding for its next round of Series A, which was set at $5 million, and was uncertain about its ability to deliver returns that met investor expectations with its current business model in the agricultural technology space.
Founded by Fariq Naushad and Previn Jacob Varghese, Greenikk had secured a pre-seed round of funding of Rs 5.04 crore in January 2023, with backing from 9 Unicorn Ventures, Smart Spark Ventures; Manish Modi of Mastermind Capital Ventures; Saurabh Agarwal and Mayank Tiwari of Reshamandi; and Arjun Pillai.
The Thiruvananthapuram-based company added, “We may be able to build a low profitable business but justified VC level returns to our investors was not possible.”
The company announced its closure after offering two-month severance packages and job references to nearly 25 employees. Greenikk had established Enablement Centres (ECs) across the country to support farmers with essential services like finance, seed distribution, crop advisory, insurance, agri inputs, including weather forecasts, and market connections. These ECs were located in key banana-producing regions such as Kerala, Tamil Nadu, and Karnataka.
In FY22, the company experienced a 300% growth in sales, reaching Rs 1.58 crore. The founders have shared their projections for FY23 end, expecting to have generated revenues of Rs 6 crore. Greenikk had clients including Beyond Snacks (funded by Shark Tank), Tierra Foods, Chedda Foods Mumbai, Kozhikodens, Casco Mumbai, Vimala Welfare Centre, and Reshamandi.
