Cloud Farm Continues to Lead Internet Plus Agriculture, Boosting China's Agricultural Development
Driven by the rapid penetration of the Internet and policy support, agricultural e-commerce is currently spreading like wildfire, and capital from all sides is actively positioning itself to seize this new blue ocean. At the end of 2014, China's leading large-scale investment group - Legend Holdings - made a strategic investment of tens of millions of US dollars in Cloud Farm, providing strong support for Cloud Farm to integrate upstream and downstream resources and become the industry's largest Internet agricultural inputs and technology service platform. This move was interpreted by industry insiders as the arrival of the tipping point for agricultural e-commerce.
Recently, Cloud Farm announced that it had received another investment of over 100 million yuan from Spring Capital, and the two parties will work together to build a high-tech, full-industry-chain model for agricultural Internet.
Agricultural e-commerce ushers in rapid development
At present, Chinese agriculture is undergoing earth-shaking changes, and the era of Agriculture 3.0, marked mainly by intelligence, precision and customization, has arrived. In the era of Agriculture 3.0, the Internet” is closely connected with agricultural modernization, penetrating informatization into all links such as agricultural production, agricultural product sales and comprehensive rural information services.
On May 7, the State Council officially issued the "Opinions on Vigorously Developing E-Commerce and Accelerating the Cultivation of New Economic Momentum," emphasizing the need to actively develop rural e-commerce. From the perspective of agricultural production factors, agricultural machinery, chemical fertilizers, pesticides, seeds and other agricultural input products can all be produced in a standardized way, fit the characteristics of repeat purchases, and are suitable for sale through e-commerce models.
According to industry analysis, against the backdrop of the current rapid penetration of the Internet and favorable policy support, the external foundations required for the development of agricultural e-commerce are mature, and the sector has entered a golden period of accelerated transformation and innovative development.
Cloud Farm receives another investment of over 100 million yuan
The agricultural inputs market exceeds one trillion yuan in scale, and leading agricultural inputs e-commerce companies have room for revenue growth of more than tenfold. Agricultural inputs e-commerce, which combines the two hot themes of modern agriculture and “Internet Plus,” is bound to be enthusiastically pursued by the capital market.
It is reported that China's first agricultural Internet high-tech comprehensive service provider—Cloud Farm has established more than 300 county-level service centers, more than 25,000 village-level service stations, more than one million registered users and nearly one million consumer users. Its market covers 13 provinces including Shandong, Henan, Hebei, Jiangsu and Heilongjiang, serves a land area of 300 million mu, and has developed into the country's largest online agricultural inputs mall, leading “Internet Plus agriculture.”
According to the head of the relevant department of Cloud Farm, in early June this year Cloud Farm successfully completed its Series A+ financing, obtaining an investment of over 100 million yuan from Spring Capital. This is another time Cloud Farm has won the favor of the capital market after receiving a strategic investment of tens of millions of US dollars from Legend Holdings, injecting capital strength into the company's further development.
The management team of Spring Capital has been deeply engaged in the enterprise services field for many years and is skilled in investments in areas such as B2B trading platforms, SaaS and Internet finance. Relying on its original financial service model of “equity investment + data debt,” it quickly became a rising star in the field of industrial Internet investment.
Regarding this strategic investment in Cloud Farm, He Wen, a partner at Spring Capital, said: “The circulation of agricultural inputs and agricultural products has many pain points, such as information asymmetry and low efficiency of capital flow. This is exactly an area where the Internet can shine. Spring Capital has long been optimistic about business models that deeply integrate traditional agriculture and the Internet, and has already made deep arrangements in related fields. Cloud Farm is a leading enterprise in agriculture plus the Internet and, after several years of development, has formed a relatively clear business model. At the same time, Cloud Farm also has a team that is very down-to-earth yet full of Internet thinking. We believe Cloud Farm will certainly quickly become a leader in agricultural Internet and lead the development of the industry. Going forward, Spring Capital will also leverage its own advantages, integrate relevant financial resources, provide financial support to the upstream and downstream of the Cloud Farm platform, and help Cloud Farm continue to develop rapidly.”
May accelerate the oligopolization trend of agricultural inputs e-commerce
Competition in the Internet industry is far more brutal than in traditional industries: only first place counts, not second. Shen Yunchang, a researcher at the Ministry of Commerce, predicts that the future landscape of agricultural inputs e-commerce will show an oligopolistic trend. Facing the continuous sinking of agricultural inputs terminals, if existing e-commerce platforms can integrate technical services, business services and platform services into one, they will stand out in the e-commerce era.
Some industry insiders said that how much impact Cloud Farm's successful financing will specifically have on the agricultural inputs e-commerce industry remains to be seen, but it is foreseeable that the entry of capital will to a certain extent affect the landscape of the e-commerce industry, or may spur more platforms to accelerate their search for capital support and the pace of interested capital entering the agricultural inputs e-commerce industry, accelerating the process of the oligopolization trend in agricultural inputs e-commerce.