The Coronavirus pandemic continues to challenge traditional assumptions about supply chains across the food and agribusiness sector. In order to balance novel health and safety considerations with changing consumption patterns—coronavirus related and otherwise--firms are reconsidering consumers, production sources and distribution channels. In turn, these questions have contributed to a myriad of pressures on policymakers and commercial entities. As balance sheets weaken (especially for early stage companies) and both social need and opportunity have become even more widespread, fund managers looking for sustainable food and agriculture investment opportunities must rethink the meaning of social impact. Governments and businesses must adapt policy and strategy to balance circumstantial exigencies with long standing consumption and demographic trajectories. Essential sectors like food and agriculture are uniquely sensitive to this dynamic, especially so in developing markets like India and Southeast Asia.
Uncertain and changing conditions in markets—either from within or exogenously—challenge existing supply chains and necessitate innovation. Like never before, innovation must be tailored to achieve sustainable food and agriculture investments at scale. There is no dearth of innovation in food and agriculture and companies throughout the sector will need to innovate to ensure they are also poised to accommodate the consequences of the coronavirus on their category in the supply chain and ultimate consumer. As fund managers consider how to either invest in innovation or ensure their existing assets have access to innovation, they must evaluate the role innovation can play in this context. How can LP capital be allocated efficiently to achieve optimal impact in an era of restrained capital and capital scarcity? Is it through technology, commercial methodology or some hybrid of both? Is obtainable impact realised through drastic shocks to the supply chain or incremental development?
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Mandala Capital is a private equity firm focused on long term and sustainable investments across the food value chain in India and South East Asia. We partner with visionary promoters and management by providing complete financial and operational support to increase the companies’ value and help companies achieve sustained leadership in their sectors.