This start-up aims to make commodity trading efficient, effective and seamless

There are agtech start-ups and then there are fintech start-ups as well. But a Delhi-based start-up has merged the two segments into one and claims to be an “ag-fintech” platform that is trying to solve complex problems in the B2B commodity trading arena.

Founded in 2020, Poshn is a wholesale processed commodity distribution and financing platform that is aiming to make wholesale trade efficient, effective and seamless by offering full-stack services for wholesale trading of commodities where wholesale buyers can purchase from millers and stockists.

It not only provides seamless discovery of and transactions for the wholesale commodity-market but also assists buyers/sellers with logistics and offers flexible payment solutions

Founders Bhuvnesh Gupta and Shashank Singh launched Poshn with an aim to transform the highly fragmented processed commodity trade market into a technology-led global marketplace.

This assumes significance as commodity trading is still looked upon as an opaque exercise with supply quite fragmented and demand inelastic along with being fragmented as well.

“During our research of B2B ecosystems in India & Southeast Asia, we observed multiple inefficiencies in the agri processing value chains,” says Singh, who is an alumnus of IIM Ahmedabad and BITS Pilani.

“We also felt that current operating models had certain challenges from the cost discipline. That is where we decided to launch Poshn, which solved key SME challenges in the most cost-efficient manner, which is the only way to scale the ecosystem,” he adds.

This problem-solving exercise becomes all the more significant when one realises that the Indian agri-industry is expected to grow about 1.5 times in the coming few years and by 2026, the market value expected to be around $1600 billion.

Incidentally, using a proprietary AI model, the start-up is able to reduce the time to trade by breaking the demand requests into smaller segments and mapping them with several suppliers to find the best match.  

As a result, the requirements are fulfilled within a matter of minutes, compared to several weeks with the traditional process.

While buyers benefit from factors like efficient and instant discovery of prices and commodities along with reduction in procurement timelines and fulfilment and delivery reliability, suppliers stand to gain on account of factors like access to reliable distribution to SMEs in an otherwise fragmented markets, capacity planning, and also access to working capital.

Further, buyers are able to expand their margins by buying at best prices while sellers get timely payments and are able to enhance their distribution coverage.

“Poshn suppliers get access to consistent demand which helps them plan for their capacities and purchases. This brings efficiencies in their cost of production. They also have access to consistent working capital which further allows processing units to operate unfettered,” says Singh who has earlier worked with companies like Michelin Tyres, BlackBuck, and Uber.

“Poshn buyers have one stop shop for all their bulk buying needs without worrying about the right suppliers, quality and unfulfillment. Poshn becomes their go-to partner to procure the right quantity, right quality at the right time at the right price,” he adds.

Meanwhile, in terms of funding, the start-up has raised a total of $6 million with investors like Prime Venture Partners, Zephyr Peacock India, Alteria Capital, UCIC and Northern Arc having invested in the start-up.

With nearly 70 employees, the start-up has more than 600 users in the wholesale space with the last financial year witnessing total revenue of ₹510 crore – it makes money on every transaction that happens on the platform -- significantly higher than the previous year’s revenue of ₹110 crore.

More importantly, the current run rate is pegged at around ₹60 crore a month.

“Over the next 4-5 years we see ourselves being a $1 billion ARR (annual run rate) platform catering to a global clientele,” says Singh.

Going ahead, the start-up plans to expand in the domestic and international markets in the commodities in which it operates along with expansion of the commodity suite.

“By 2030 we will be the go-to B2B platform in the food and agro space not just in domestic but in global markets as well. We will continuously thrive to solve the challenges faced by players in this ecosystem,” says Singh.