Stellapps, a Bengaluru-based dairy tech startup, is in advanced discussions to secure around $20 million in its Series C funding round.
Nearly 70% of the funding will be raised from existing investors, including Celesta Capital, Omnivore, Gates Foundation, IDH Farmfit Fund, Blume Ventures, and Qualcomm Ventures.
Ranjith Mukundan, the CEO and Co-Founder of Stellapps, mentioned that a few new investors are expected to join the funding round. However, he did not reveal the identities of these new investors or the valuation sought by the startup in the fundraising process.
The startup plans to use the new capital for its expansion initiatives, particularly emphasizing the development of value-added dairy products.
Established in 2011 by IIT alumni and former Wipro employees, including Mukundan, Ravi Shiroor, Ramakrishna Adukuri, Praveen Nale, and Venkatesh Seshasayee, Stellapps offers a full-stack Internet of Things (IoT) platform. This platform is designed to digitize and enhance the efficiency of the entire milk supply chain, spanning from production to procurement and storage. Additionally, the platform facilitates connections between farmers and financial institutions, insurance providers, cattle nutrition suppliers, and agro-input providers.
Around July last year, the startup also began processing milk to supply value-added dairy products to B2B companies.
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The startup currently supplies curd, ghee, paneer, buttermilk, double-toned milk, and other products to FMCG brands. With processing plants in Uttar Pradesh and Bengaluru, it aims to expand further by adding two more facilities.
“We are also considering making ice-cream and selling it under a private label to other businesses,” Mukundan added.
Addressing a query regarding the selection of the B2B approach for its dairy products, Mukundan explained that B2C businesses demand substantial capital for brand creation and customer acquisition.
According to the CEO, the dairy tech startup is considering an initial public offering within the next 36-48 months.
“We’re building our brand towards IPO and (want to) provide our investors a 5X return. We are working towards listing our company at around $450 Mn-$500 Mn valuation during the IPO,” Mukundan added.
The startup is set to conclude the current financial year with a revenue of INR 400 Cr and aims to achieve INR 2,000 Cr in the upcoming three to four years.
Stellapps secured an undisclosed amount of funding from IDH FarmFit in 2022, following its Pre-Series C funding round where it raised $18 Mn from Nutreco, a global animal nutrition and aquaculture company, a few months earlier.