Acumen India has invested in S4S Technologies, a company whose solar-powered drying machines are increasing smallholder farmers’ incomes while reducing food waste.
THE CHALLENGE: WASTED CROPS
In India, smallholder farmers’ incomes depend not only on the amount of crops they have to sell but also their “grade”: a quality rating determined by aesthetic criteria like the size, shape and color of the fruit or vegetable. Based on this rating, buyers reject around one fifth of farmers’ crop yields—even though the rejected produce is safe to eat and has the same nutrient value.
For their higher-grade produce, smallholder farmers lack access to processing machines or cold storage facilities to preserve it—leaving a narrow window in which to sell their crops before they rot. Between rejection and spoilage, $14 billion worth of India’s produce is wasted each year.
What’s worse, the time pressure to sell leaves smallholder farmers with no negotiating power, forcing them to sell their produce at whatever exploitative prices buyers offer.
THE INNOVATION: DRYERS MAKE USE OF REJECTED CROPS
Co-founded by a team of five entrepreneurs including Dr.Vaibhav Tidke and Acumen India Fellow Nidhi Pant, S4S Technologies created and patented a Solar Conduction Dryer (SCD): a portable, solar-powered machine that dries vegetables and spices while retaining their nutrients.
S4S partners with rural women, supplying them with an SCD to dry produce in their homes. The company purchases lower-grade rejected produce from local smallholder farmers and brings it to the women entrepreneurs to dry.
S4S then transports the produce to a central processing facility after drying—at one tenth the weight of regular produce. This energy-efficient process cuts logistical costs by 80 percent while diverting thousands of tons of CO2 emissions. S4S packages the dried produce for sale to large-scale production companies like Marico, Nestle, and food service providers like Sodexo.
WHY ACUMEN INVESTED: LEVERAGING OFF-GRID APPLIANCES TO RAISE INCOMES
Acumen India invests in agriculture and workforce development, sectors where we see the greatest opportunity to address poverty in the region. S4S fits within the productivity sub-sector of Acumen’s Pioneer Energy Investment Initiative (PEII): energy companies offering low-income communities the opportunity to generate income and enhance their livelihoods.
“S4S has great potential across crops and value chains to create additional stable income for farmers and women—all while providing phenomenally convenient and flexible ingredients to packaged food players and restaurants. The business has huge potential to grow across different agricultural value chains while being environmentally positive,” said Acumen India Director Mahesh Yagnaraman.
“We are happy to partner with Acumen, CSAW and existing investors Factor E Ventures. We will use these funds to expand our product portfolio, tap into new markets and build efficiency to reduce capital investment,” said Dr. Vaibhav Tidke, S4S CEO and Co-Founder.
“It’s exciting to partner with Acumen in yet another way. The Acumen India Fellowship helped me redefine my approach towards systemic problems and equipped me with the tools and skill sets to navigate the complexities in the food and agriculture supply chain. As S4S positions for growth and scale, the Fellowship has fueled my learnings and improved my preparedness for the scale up plan,” said Nidhi Pant, S4S Co-Founder and Acumen India Fellow.
S4S is Acumen’s ninth investment as part of our Pioneer Energy Investment Initiative (PEII).
For more on Acumen’s guiding investment philosophy, see our eight Investment Principles.