Cultivating SE Asia's Food Future

Converge
Cultivating Southeast Asia for the Future of Food
September 2019

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Converge - Cultivating Southeast Asia for the Future of Food

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About
Converge
Converge is a series of reports by Deloitte Southeast Asia Innovation that provides
insights into the technology trends and startup ecosystem in Southeast Asia.
Each report provides a snapshot of the upcoming technology trends in a particular sector
and introduces promising startups that are driving new ideas and taking on challenges that
are unique to Southeast Asia.
Join us in discovering interesting and potentially disruptive startups and initiatives across a
range of industries and feel the pulse of Southeast Asia’s thriving digital revolution!
Who the report is for:
• Corporations exploring innovation capabilities and startup engagement
• Individuals who are keen to understand technology and innovation trends driven by
the startup ecosystem in Southeast Asia
About Deloitte Southeast Asia Innovation
Deloitte Southeast Asia (SEA) Innovation is a cross-function, cross-country unit dedicated
to driving innovation as a long-term value creator across Deloitte's Southeast Asia
operations.
Have feedback on Converge? Drop us a note at
SEAinnovation@deloitte.com!
Sources and Limitations:
This report draws from startup databases such as Tracxn, Crunchbase, e27 and Tech in Asia; articles from local, regional and
global news sources; as well as respective company websites. While we try our best to ensure that this report is accurate as of
the date of publication, some limitations remain due to the nature of information sources.

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The Rojak of Life
Rojak (noun): a traditional Southeast Asian fruit and vegetable salad dressed in a sweet and sour sauce. Also spelled as rujak.
Rojak (adjective / colloquial): eclectic mix
So much of life in Southeast Asia is about food, and many Asians
are proud of being part of a vibrant and diverse culinary culture.
From tofu (Chinese bean curd) to tempeh (traditional Indonesian
soy product) to nhon mhai (silkworms in Thai), Southeast Asians
have a long history of eating a wide variety of foods that are gaining
modern popularity as superfoods or alternative proteins.
Beyond the celebration and consumption of food, many people in
this region are also reliant on its supply and production for their
livelihoods (see Table 1). Their countries, in turn, rely on them to
contribute to national food security.
The agriculture industry in Southeast Asia is very fragmented, with
an estimated 100 million smallholder farmers making up a large
part of the sector1
. Often faced with a lack of access to information,
markets and capital, and well as a string of middlemen in the long
supply chains, smallholder farmers are impoverished despite doing
productive work.
The plight of smallholder farmers has been highlighted by non-
profit organisations, governments and international bodies like the
Food and Agriculture Organization of the United Nations (FAO).
With greater awareness in society about ethical food sources and
sustainability concerns, this sector has attracted considerable
attention, resources and ideas for improvement.
Against this backdrop, and with the growing smartphone usage in
the region, we explore how some startups have created solutions
that address the challenges of smallholder farmers. We also take
a look at how Southeast Asian startups have jumped onto the
superfoods bandwagon in response to the food trends that have
emerged in more developed cities globally.
Table 1 - Agriculture employment in Southeast Asian nations
Source: The World Bank, 2018 World Development Indicators, available at http://databank.worldbank.org/data/
1. https://www.growasia.org/context
Country
Total
Population
Total
Labor Force
Employment in agriculture
(% of total employment)
Brunei Darussalam 428,962 216,193 1.34%
Indonesia 267,663,435 131,135,747 30.53%
Cambodia 16,249,798 9,068,225 30.43%
Lao PDR 7,061,507 3,726,264 68.03%
Myanmar 53,708,395 24,561,204 50.14%
Malaysia 31,528,585 15,470,124 11.09%
Philippines 106,651,922 43,732,068 25.19%
Singapore 5,638,676 3,283,161 0.47%
Thailand 69,428,524 38,903,300 30.67%
Timor-Leste 1,267,972 279,185 50.02%
Vietnam 95,540,395 56,933,418 39.80%

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Farming for a livelihood takes more than just growing and harvesting. To be able to turn crops into cash, it is important for smallholder
farmers to obtain good resources and equipment at the start, and to sell off their perishable harvest in a timely manner at the end.
However, the conventional agriculture and food supply chain is long and fraught with pitfalls, with many intermediaries involved in many
aspects - from the buying of inputs, to crop storage, to the transportation of goods to city centres for sale. Startups are joining the fold and
injecting new ideas into a very traditional industry.
Before Farming: Capital Access
In order to afford quality inputs and technology required for farming, farmers need to have capital. Yet, smallholder farmers often
struggle to get formal credit and loans, due to poor information available on their farming activity and their inability to provide
suitable collateral2
.
With the increase in mobile phone penetration even amongst the rural community, peer-to-peer (P2P) lending and crowdfunding
are emerging as possible ways to plug the funding gaps for farmers. Startups like Crowde, Cropital, FarmOn.ph and iGrow run
platforms linking investors with farmers, and usually require only a small minimum sum for investors to get started (see Table 2).
Taking lessons from the immensely popular grow-your-farm online game, FarmVille, these platforms also offer investors the
chance to farm vicariously by being able to choose which farming projects to invest in, and also monitor the progress of the crop.
Table 2 – Agriculture-funding startups
Startup Description Country Founding Year Total Funding
Crowde
https://crowde.co/
An agriculture-focused fintech startup that
empowers farmers across Indonesia with
technology and capital.
Indonesia 2015
Seed-
Undisclosed
Cropital
https://www.cropital.com/
A crowdfunding platform where users can
invest in farms and get rewards based on the
harvest.
Philippines 2015 Grant- US$21.4K
FarmOn.ph
https://community.farmon.ph/
An agriculture crowdfunding platform that also
owns 96 hectares of land in the Philippines,
which their partners and farmers manage..
Philippines 2014 Undisclosed
iGrow
https://igrow.asia/
A marketplace and crowdfunding platform that
connects farmers, landowners, and investors, as
well as buyers and sellers for the harvest.
Indonesia 2014
Funding round
undisclosed- At
least US$175K
Source: Crunchbase, Tracxn, respective company websites
2. http://www.fao.org/fileadmin/templates/esa/smallholders/Concept_Smallholder_Dataportrait_web.pdf
The Plight of Smallholder Farmers

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During Farming: Knowledge Access
Much of the success of farming outcomes is due to elements that are not within the farmer's direct control, like the weather
and the behaviour of predators. Over the course of the production cycle, the farmer's ability to monitor the farm adequately
and act in a timely and optimal manner is very important to maximise farming yields.
Precision agriculture, which entails observing, measuring and then reacting specifically to variable conditions, is gaining
momentum in the region. Notable startups have emerged, like MimosaTEK from Vietnam, whose Internet of Things (IoT)
solutions can address particular farming concerns such as irrigation, or fertigation (see Table 3).
A less capital-intensive model of using information and data to improve farming outcomes has also emerged. With online
social networks connecting people, and the smartphone being able to capture some unique datapoints, knowledge sharing on
farming techniques, best practices and other environmental and market conditions can be crowdsourced and shared easily.
A good example of this is Impact Terra from Myanmar, which has created an Android-based mobile application called Golden
Paddy to dispense daily practical information personalised for the farmer’s location and crops. The mobile application takes up
very little space on the phone, uses limited data and can function even without internet access3
, which suits the mobile phone
and internet data consumption habits of their users. To promote even greater outreach within the farming community, Impact
Terra also has a Golden Paddy Facebook group, which has since amassed a huge following.
Similar startups exist for smallholder farmer communities across Southeast Asia. Ricult, which operates in Thailand and
Pakistan, has reportedly helped to improve farmer yields by about 50 percent on average, and increased their profits by 30 to
40 percent 4
.
Table 3 – Digital farming startups
MimosaTEK
https://mimosatek.com/
MimosaTEK develops IoT-based solutions to help
farmers maximise productivity and minimise crop
production risks and costs.
Vietnam 2014 Seed- US$1M
Ricult
http://www.ricult.com/
Ricult is an agricultural digital solutions startup
that promotes productivity and profitability for
smallholder farmers.
Thailand/
Pakistan
2015 Seed- US$2.5M
Impact Terra
https://www.impactterra.
com/
Impact Terra develops digital market linkages for
farmers, agribusinesses and other agricultural
stakeholders.
Myanmar 2016 Grant- US$3M
3. https://www.impactterra.com/golden-paddy
4. http://news.mit.edu/2018/ricult-thailand-pakistan-farmers-1115

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After Farming: Market Access
Food loss, defined by the FAO as “any food that is lost in the supply chain between the producer and the market”, amounts to
about 1.3 billion tonnes of food globally every year. Not only is that about a third of global food production wasted5
, it is also a
massive loss of income for farmers who put in months of unpaid work prior to the harvest.
Given that agriculture produce is highly perishable, the issue of market access is not only about availability of customers, but
also about the timeliness of it. Agriculture marketplace startups are trying to solve this problem by cutting out the many layers
of middlemen who make it difficult to time the market, and who are also notoriously exploitative in their dealings with farmers6
.
Making its point about that is Indonesian agriculture marketplace Regopantes, created by 8Villages, whose name literally
translates to “fair price” (see Table 4).
Indonesia, in particular, has seen a range of agriculture startups emerge and grow in directions that show the way for the
retailing of agriculture produce. Limakilo (see Table 4), an online platform that links farmers to consumers, also has about 1000
physical kiosks in its network. It was acquired by mom-and-pop retail digitalisation enabler Warung Pintar in 2019, which will
grow their physical footprint even more.
By linking farmers directly to consumers, farmers have more say in negotiations and enjoy more value capture. More
importantly, they are also able to build their own pipeline of customers and deals. Instead of handing their fate over to
middlemen who may leave the fresh produce to languish, farmers now have more control and can plan for the harvest and
delivery of their highly perishable goods.
Table 4 – Agriculture marketplace startups
Tani Group
https://tanihub.com/
https://tanifund.com/
TaniHub is a B2B agriculture marketplace that connects
farmers with hotels, restaurants etc. TaniFund provides
farmers with access to loans and funds.
Indonesia 2015
Series A-
US$10M
8Villages
https://8villages.com/
8villages provides a range of platform services to help
smallholder farmers, including agriculture sharing
community LISA, and agriculture marketplace Regopantes .
Indonesia 2012
Seed -
US$150K
Limakilo
http://limakilo.id/
Limakilo is an online marketplace that helps farmers sell
their harvest directly and efficiently to end-consumers. It
also has about 1000 physical kiosks in its network.
Indonesia 2015
Acquired by
Warung Pintar
- Undisclosed
5. http://www.fao.org/save-food/resources/keyfindings/en/
6. https://www.channelnewsasia.com/news/cnainsider/regopantes-app-champion-exploited-farmers-indonesia-fair-price-9815254
7. https://govinsider.asia/digital-gov/malaysia-launches-high-tech-durians/
Malaysia’s Internet of Durians
The King of Fruits – as durians are affectionately called in Southeast Asia– may taste like heaven and smell like hell to the
uninitiated, but connoisseurs know better than that. Origin of harvest matters to the distinct taste and smell profile that
differentiates the species, and each variant commands a different price tag.
In Malaysia, as part of their smart agriculture drive, the Ministry of Science, Technology and Innovation (MOSTI) rolled out
an agriculture produce tracing platform, focusing first on providing quality assurance for the country's premium grade
durian exports7
. With this platform, consumers are able to track the origin and the journey of the durians with a simple
scan of a barcode.
Information on the consumer is also logged for the benefit of suppliers. When users scan the codes attached to the
durians, information like their location and phone types are also recorded, allowing suppliers to monitor durian deliveries
and plan for better logistics and customer experience.

08
An economic challenge
A closer look into each of the startups listed in
the previous sections would reveal that many of
them have expanded beyond their initial scope of
services for smallholder farmers.
In Indonesia, Tani Group (see Table 4) started
with TaniHub, a digital marketplace that connects
farmers with individual and corporate customers;
then expanded into TaniFund, which gives
TaniHub farmers the chance to crowdsource
funding and apply for loans. Similarly, iGrow (see
Table 2) may have gained popularity as a real-life
FarmVille and a quirky investment opportunity,
but it also operates a marketplace to ensure that
the harvest from those farming investments can
get sold.
The plight of the smallholder farmer is a
complex economic problem that requires better
coordination on many fronts, and solving the
existing challenges will both alleviate individual
hardship and improve national output. With
burgeoning economic growth in the region from
the manufacturing and service sectors, Southeast
Asian youth are understandably moving into
urban centres for better work opportunities and
foregoing the rural farming lifestyle of previous
generations.
The emergence of new technology and
investment in the agricultural sector can boost
productivity and efficiencies, but the ageing
farmer ultimately needs successors to run the
farms. Perhaps, the youthful startup can elevate
the conditions of farm work, and make farming
attractive once again.

09
The effective coordination amongst disparate actors across the supply chain
requires a reliable stream information. Blockchain technology offers a
game-changing approach to tracking and storing data.
Feeding the Ecosystem with Data
Data collection: a matter of how and why
A US$150 billion global industry, Southeast Asia is home to four
of the top ten fish producers in the world, namely Indonesia,
Thailand, Vietnam and the Philippines8
. Fishery-focused Fishcoin
(see Table 5) issues its own token to incentivise upstream
actors around the world and in Southeast Asia to record and
share information about their activities. Noting that more than
85% of the world’s seafood comes from smallholder farmers
in developing nations who are unlikely to trust cryptocurrency,
Fishcoin has partnered with a network of over 500 mobile
operators in 135 countries, who can transform these tokens into
more tangible benefits for farmers, like redeemable or cheaper
mobile airtime9
.
With a similar dedication to information exchange, Indonesia’s
HARA is invested in being an agriculture sector data collector. It
aims to help farmers establish a digital identity, and deploys local
agents to collect information on farm ownership, size, harvests
and other data points. Such information plugs huge gaps not
just for the agriculture business, but also for the financial sector
where it relates to credit-scoring and loans for farmers10
.
A blockchain-based solution provides infrastructure that can be
useful in this region– as long as there is someone on the ground
to tell farmers how to, and why they should use it.
Enhancing traceability and accountability
As consumers become increasingly concerned about the
source of their food due to ethical considerations or food scares
experienced in recent years, it will be important for businesses
to start collecting quality provenance information to provide
assurances.
In China’s Hema supermarket chain, the poster child for internet
giant Alibaba’s “new retail” concept for brick-and-mortar shopping
in an internet age, traceability from farm to store for over 1700
products is available to customers through the Hema mobile
application11
. With a quick scan of a product’s unique QR code,
product-specific details will be shown to customers, including
photos of the relevant food distributor’s license, dates of delivery,
and even the temperature within the delivery truck when it
transported the fresh produce to the store.
The richness of data at a consumer’s fingertips is made possible
because of the blockchain-based solutions that tech companies
and supermarkets have been pioneering in the past few years.
As IBM’s Food Trust Solution has shown, with blockchain,
food sources can be traced in a mere 2.2 seconds, down from
the typical 7 days12
required for investigation and recall. For
the purpose of public health and safety management, this is
revolutionary– and potentially life-saving.
Table 5 – Agritech blockchain startups
Fishcoin
https://fishcoin.co/
A blockchain-based seafood traceability and
data ecosystem designed to incentivise supply
chain stakeholders to share data from point of
harvest to point of consumption.
Singapore 2017 Undisclosed
HARA
https://haratoken.io/
HARA connects rural smallholder farmers
with banks, insurance companies and input
producers through the collection and sharing of
hard-to-obtain data.
Indonesia 2015 Undisclosed
8. http://investasean.asean.org/index.php/page/view/fisheries
9. https://fishcoin.co/files/fishcoin.pdf
10. https://breakermag.com/in-indonesia-blockchain-powered-farming-blossoms/
11. https://www.alizila.com/hema-food-tracking/
12. https://techcrunch.com/2018/09/24/walmart-is-betting-on-the-blockchain-to-improve-food-safety/

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For the foreign taste bud, Southeast Asian food is generally seen
as exotic, and traditional ingredients from the region have since
been co-opted into a hipster’s eclectic ricebowl. With the likes of
Impossible Foods and Beyond Meat coming to Asia in recent years,
there is a growing buzz and excitement around plant-based and
lab-grown meats, and a resurgence of interest within the region on
what Southeast Asia could possibly whip up for the global palette.
Strong Hindu and Buddhist cultural influences in the region have
made vegetarianism a rather mainstream idea, but while the idea
of mock meat is not unfamiliar to the Southeast Asian person, the
idea of cellular cultivation of meat is. Buddhist chefs may have
perfected the art of rolling gluten to look and taste like char siew
(roast pork), but it took scientists behind Shiok Meats (see Table
6) to prepare authentic siew mai (prawn dumpling) without killing a
single prawn13
.
Also being transformed by scientific intervention is white rice, a
staple for the Southeast Asian diet. Alchemy Foodtech has created
a patent-pending formula to reduce the high glycemic index in
traditionally planted rice, creating a healthier option for diabetic
patients, without sacrificing the gastronomical value of it.
Table 6 – Alternative foods startups
Shiok Meats
https://shiokmeats.com/
A cell-based, crustacan meat producing
company.
Singapore 2018 Seed- US$ 4.8M
Alchemy Foodtech
https://www.alchemyfoodtech.com/
A food science and technology company
that develops novel active food ingredients
that fights diabetes.
Singapore 2015 Seed- S$ 2.5M
Insectta
https://www.insectta.com/
Singapore's first black soldier fly farm; also
a biotech company which uses insects to
convert food waste into valuable products.
Singapore 2017 Undisclosed
Southeast Asian Alternative Foodie
Are insects the answer to food security and sustainability?
With increasing concerns around the environmental impact of farming animals for their meat, an alternative has cropped up – an
insect diet. Swedish furniture maker IKEA, also famous for their meatballs, has fueled the imagination of many with their alternative
meatball experiments14
, including one made of bugs.
While some parts of the world would need to overcome psychological barriers to this idea15
, it might be worth noting that eating
insects - in their full glory - is commonplace in Southeast Asia, as it is with reportedly over 2 billion people globally16
. For a long time,
Southeast Asians have been frying up and eating silkworms, grasshoppers and even scorpions as snacks.
The potential for insects is beyond their delectable corn puff-like crunchiness, slathered in spicy, oily saltiness. Insectta (see Table
6), a Singapore-based startup that houses Singapore’s first black soldier fly farm, uses insects to convert food waste into valuable
products such as fertilisers. In addition, their larvae is also an alternative supply of livestock feed.
With the right education and investment, insects may one day become an important part of our global food chain.
13. https://www.channelnewsasia.com/news/singapore/siew-mai-goes-high-tech-singapore-s-first-cell-based-shrimp-11393320
14. https://space10.io/project/tomorrows-meatball/
15. https://www.researchgate.net/publication/320280993_Understanding_Westerners'_disgust_for_the_eating_of_insects_The_role_of_food_neophobia_and_implicit_associations
16. http://scienceinpoland.pap.pl/en/news/news%2C28495%2Cexpert-more-2-billion-people-worldwide-eat-insects-every-day.html

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Food forms the very sustenance of humanity, and making food
is a complex and multi-dimensional economic problem. The
food supply chain is global and very fragmented, posing a huge
challenge to accountability and raising questions about its
efficiency.
Southeast Asia contributes significantly to the global food supply
chain in the categories of palm oil, rice, fisheries, and even
coconuts, which sustains an estimated 25 million people in the
Philippines alone17
. The output from the agriculture industry has
huge implications on the long-term economy and welfare of people
in the Southeast Asian nations, where a large number of people are
dependent not just as consumers, but also as smallholder farmers.
Smallholder farmers have very little control over critical
macroeconomic factors that can have a major impact on their
livelihoods, including weather variations, geo-political tensions in
the region, and even national policies. Despite that, agritech and
foodtech startups have shown many ways in which the potential
for higher efficiency remains untapped.
Often, these startups are also the ones on the ground encouraging
farmers to adopt new technology, in order for them to gain greater
access to knowledge, capital and markets. In modernising the
trade for these farmers through their tech-enabled solutions,
these startups are also rejuvenating a traditional industry that is
losing successors to the allure of urban opportunities in one of the
world’s fastest-growing regions.
With the mobile smartphone penetrating even rural parts of
Southeast Asia, solutions to persistent problems on both the
producer and consumer ends are starting to emerge. It will be a
transformative era for a traditional sector, and the seeds for the
future have been sowed.
Conclusion
17. http://www.fao.org/3/a-bt099e.pdf

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