Chennai-based agriculture supply chain company Waycool has raised ₹100 crore ($12 million) in debt financing from Grand Anicut. This marks the first major funding infusion for the company in two years, as revealed by regulatory filings accessed from the Registrar of Companies (RoC).
Details of the Debt Round
The board issued 1,000 Series B6 debentures at an issue price of ₹10,00,000 each, carrying a coupon rate of 18% per annum with a tenure of 18 months. According to the filings, the funds will be used for ongoing business operations, providing crucial support as the company continues to scale. This debt raise is particularly significant as Waycool has struggled to secure an equity round in recent times.
Waycool’s Business Model and Growth
Founded by Karthik Jayaraman and Sanjay Dasari, Waycool operates across the agriculture supply chain, purchasing fresh produce—including dairy products—from farmers and selling them to retailers and restaurants. The company also runs private label brands and manages distribution for FMCG companies.
Waycool has raised approximately $160 million to date from notable investors such as Lightrock, the International Finance Corporation, FMO, and 57 Stars. The company had been in discussions to raise an additional $50 million, which would have propelled its valuation to between $900 million and $1 billion. However, these talks did not materialize, and the firm remains valued at $700 million after its last equity round.
Challenges and Financial Performance
To reduce costs, Waycool laid off 200 employees earlier this year as part of its drive towards profitability, which the company aimed to achieve by July. The firm registered a 62% growth in operating revenue to ₹1,251 crore in FY23, though losses surged by 89%, reaching ₹685 crore during the same period. Waycool’s FY24 report is yet to be filed.
Agritech Funding Landscape
Waycool’s recent debt raise highlights the broader equity capital scarcity affecting the agritech sector. Alongside Dehaat and Ninjacart, Waycool has been on the verge of achieving unicorn status but has not yet crossed the billion-dollar threshold. According to TheKredible, agritech remains one of the least funded sectors in 2024, with only $150 million raised by 30 startups by September. This follows a significant drop in funding, down from $772 million in 2022 and $636 million in 2021.
Amid these challenges, other agritech firms are struggling to stay afloat. On Monday, agritech firm Greenikk announced its shutdown due to operational difficulties, further underscoring the sector’s challenges.
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