- DFC provides 100% guarantee to WayCool for a loan from IndusInd Bank’s Impact Investing Group
- Loan to support WayCool’s journey into a global food supply chain and logistics player
- Funds will be used to invest in technology and expand food distribution business in South India
Bengaluru, NFAPost: Agritech start-up WayCool Foods’ raised $5.5 million through debt financing from IndusInd Bank Ltd, guaranteed by the US International Development Finance Corporation (DFC).
This follows the Series C round of $32 million led by Lightbox earlier this year. Setuka Partners LLP was the advisor to the current transaction.
US International Development Finance Corporation (DFC) has extended a 100% guarantee to WayCool Foods’ latest round of fund raise of U$5.5 Mn through debt financing from IndusInd Bank Ltd. The loan is to be deployed through IndusInd Bank’s Impact Investing division, which will support WayCool Foods’ expansion plans.
WayCool Foods plans to use the funds to introduce advanced technology, implement strict hygiene measures, and increase transportation efficiency to reduce food spoilage and improve farmer yields, thus contributing to food security. This will also allow the company to strengthen food distribution across South India.
WayCool Foods Co-Founder and CEO Karthik Jayaraman said WayCool has been steadily building necessary technology and operational capabilities to operate robust agrifood supply chains from soil to sale.
“We welcome DFC and IndusInd Bank as partners in this journey and believe that this partnership is an endorsement of WayCool’s ability to lead transformation within the sector,” said WayCool Foods Co-Founder and CEO Karthik Jayaraman.
DFC, America’s development bank, provides financing to address critical challenges across emerging markets globally. The investment in WayCool Foods demonstrates DFC’s commitment to supporting India’s food and agriculture distribution sector. The investment has been finalized after a stringent due diligence process.
On associating with WayCool Foods, DFC Director – Social Enterprise Finance Team Ajay Rao said the company is proud to work together with the remarkable team at WayCool to solve some of the most pressing challenges in India’s agricultural sector.
“We look forward to this collaboration during these critical times and are thrilled to support WayCool’s efforts to enhance food security in India,” said WayCool Foods, DFC Director – Social Enterprise Finance Team Ajay Rao.
The loan is deployed through IndusInd Bank’s Impact Investing Group. The DFC guarantee enabled the bank to provide an equivalent of Rs. 35 Crores loan to WayCool, IndusInd Bank said in a statement. The structure is significant as it helps in mobilising local capital for WayCool, also it eliminates foreign exchange rate fluctuation risk from the balance sheet of WayCool, it added.
WayCool procures, processes, and distributes a range of food products including fresh produce, staples, and dairy products, moving over 250 tonnes of food every day to 8,000 enterprise clients across South India.
The company operates a soil-to-sale model, engaging deeply with a base of 40,000 farmers in more than 50 regions across India, while bringing efficiency through its direct supply chain model. The Company plans to accelerate profitability and improve on its capital efficient model by continuing to invest in technology and automation across the value chain.
WayCool Foods and Products is promoted by investors who are keen to create social impact using market mechanisms. The company’s leadership team comprises veterans with deep experience across several industries, as well as agri-tech experts. The company serves over 50 wholesale clients and is scaling the same up rapidly. WayCool also distributes to 12 retail outlets under the brand, “SunnyBee”.
WayCool has previously raised three rounds of funding from Lightbox, LGT Lightstone Aspada, FMO, Caspian Impact Investment, and Northern Arc Capital Ltd.