We were pleased to announce this week Openspace Ventures‘ investment in Tanigroup, as lead for its $10mm Series A round.

Tanigroup is re-imagining the agricultural supply chain in Indonesia – a massive sector which hasn’t yet seen impact from the recent wave of digitization, pervasive mobile access and insightful data analytics.

Its platform today on the supply side can help farmers understand pricing trends, transact to sell their produce, manage logistics and get financing to fund their production (via Tanifund). In future it will also help them plan and optimise crop production decisions and manage their own input factors like labour, seed and supplies. By putting these tools in the hands of the agricultural owners and workers, they have a chance to be more efficient, uplift their incomes and drive better living standards for their families.

For buyers of various categories (consumers, SME, food producers, markets) it gives direct access to fresh produce at reliable quality and best price. Like in developed nations, we expect over time that consumer choices will also take into account the social and environmental impact of their food supply chain. Tanigroup will help consumers consider these factors at fine granularity by reaching all the way back to production source. By having such granularity on demand and supply, it will also help Tanigroup identify the focus products with best margin opportunities for its bottom line.

On limited capital spend, the company already serves more than 25,000 Farmers across 6 regional distribution points. In short time, we plan to extend this reach to more than 1mm farmers through extending our infrastructure to many more regions, investment in more team members to spread the word and partnerships with industry groups.

Reachout works very differently in this sector. We have witnessed the way senior farmers in a community who become Tanihub users would become our spokespeople, advocates and trainers for other people in their village or network.

We visited Pak Ande a melon farmer from Cilegon who previously could only harvest across 1ha because the intermediaries involved didn’t give certainty or trust on purchase price and timing. Now with the Tanigroup offering, he has planted 5ha and now co-ordinates a team of 8 other small land holders.

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And it’s the empathy, understanding and talent of Eka, Ivan and the rest of the Tanihub team that makes this happen. We have been deeply impressed since we met the team at the mandate they have chosen to both create value and change lives in this overlooked sector. Their vision is ‘Memberdayakan petani lokal dengan menyediakan akses pasar dan akses keuangan’ which points towards their focus on the supply side and delivering for farmers. It differentiates from other ecommerce or logistics our in our view and makes for a stronger overall business case in future when supported by capital, human resources and best in class technology development.

Openspace has seen this type of opportunity and timing before in Indonesia – whether it was the lack of on-demand transport and food options before Go-Jek, the slow pace of health service innovation pre-HaloDoc or the gap in millennial focused financing product pre-Kredivo. Just like these companies have moved on from Series A promise to serious scale, we expect Tanihub to do the same over the next several years.

Congratulations again to Eka and the Tanigroup team on what you have built and together with our co-investors, looking forward to working together to build this business over the next exciting phase.