The client, an emerging agri-tech company, was at a crucial stage in its growth. They needed a CFO to step-in and help prepare for their first formal fundraise. However, a full time CFO was too expensive an option. Enter AND who stepped in as the fractional CFO for fundraising.
As an agri-tech company, our client’s objective is to aggregate and economically source farm supplies for B2B buyers. The client’s business model involves reducing inefficiencies in the fragmented food supply chain by enabling select farmers (farmer franchisees) with equipment to process their produce, thereby providing direct market access and logistical support through a technology platform.
The quest for seed money
After successfully setting up an agri-business centre, which helped the client gain traction in the market, they found themselves at a crucial juncture. Immediately, fresh capital was required to build on their previous success and to scale the company to a INR 5,000 million enterprise. The company approached AND to act as the fractional CFO for fundraising, i.e. to help with the end-to-end fundraising exercise – right from preparation of investor pitch decks to negotiation of term sheets.
Farm to financing
AND engaged with the client to help raise equity and debt financing by carrying out the following activities.
- Educating the founders about the nature and terms of venture capital (VC) investors.
- Pivoting the business model from an asset-heavy agri business centre approach to an asset-light farmer franchisee approach.
- Then, breaking down the business model into crucial components and helping the client in prioritising the implementation of critical elements.
- Assisting the client in signing MOUs with 4 state governments and successfully pitching at international events.
- In addition to equity, preparation of the project report and CMA data for lenders.
- Approaching and coordinating with banks for debt syndication.
- Preparation of detailed info memo (IM) and financial model for equity investors.
- Further, conducting initial discussions and deal structuring with potential investors.
- And finally, drafting, negotiation and finalisation of the term sheet.
With our assistance, the client was able to close the angel funding round of INR 30 million and was able to expand their presence to 10 farmer franchisees across 5 districts. Now, the client supplies farm produce to 50+ B2B buyers.