Agritech is flourishing in Indonesia, but it’s not all bounty

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Hello readers,

House plants are having a moment. I was looking up some trends recently and found that the subreddit /houseplants grew by 175% in a year. That trend must have seeped into my friend group because one of them asked for a spider lily plant as a Christmas present last year.

And just like how house plants remained unaffected by the pandemic, Indonesia’s agriculture seems all green and leafy, with agricultural exports going up by over 14% between 2019 to early 2021. That’s good news for agritech startups, but not everything is looking rosy.

Today we look at:

• The pandemic-proof but complicated agritech sector in Indonesia
• The startup that’s making tuk-tuks cool again
• Other newsy highlights such as Alibaba gets fined -again – while Gojek and Tokopedia inch closer to a merger

PREMIUM SUMMARY

Agritech in Indonesia may be celery-brating, but it’s not without challenges

Agriculture is one of the most significant contributors to Indonesia’s economy, alongside other major sectors such as industrial, trade, construction, and mining. While this has attracted a growing number of agritech startups that aim to tackle the issues in this industry, most have found it challenging to scale.

• Broc-coli moly expensive: Acquiring customers is often the highest expense for agritech startups as most farmers aren’t tech-savvy and generally require a lot of hand-holding. Case in point: It takes Crowde, a lender for farmers, three months to bring a customer onto its platform.
• Funds aren’t growing: Venture capital firms just aren’t interested in agritech because for a startup to reach scale, it requires the participation of many parties such as the government.
• Weathering the storm: A farmer’s income is tied to how bountiful a harvest season is. This means that the effects of a bad harvest will trickle down to everyone in the chain, including startups.

Read more about the other challenges and how some startups are combating them: Indonesian agritech is pandemic-proof, but here are the warning signs

STARTUP SPOTLIGHT

Make tuk-tuks cool again