Vietnamese agriculture start-up TechCoop was founded last year by an entrepreneur whose experience includes C-suite positions at fruit exporter Nafoods, investment bank Auxesia Holdings, and iCare Benefits, a social enterprise for low-income women factory workers. Venture capitalists swooped immediately.

Ascend Vietnam Ventures was an early mover, providing an initial USD 500,000 in pre-seed funding and gradually increasing its capital commitments as it has tracked operational progress. A USD 5m seed round came last March, co-led by Ascend and TNB Aura and featuring Ethos Ventures, Mandala Capital, and Korean impact investor MYSC.

Last week, Ascend and TNB Aura returned to co-lead a USD 70m Series A round that also brought in AppWorks, BlueOrchard Finance, Capria Ventures, and Sogo Energy, among others. The deal comprised USD 42m in debt and USD 28m in equity.

It was touted as one of the largest-ever Series A equity investments in Vietnam, although TechCoop has made its headquarters in Singapore. The start-up, which digitalises distribution networking for smallholder farmers, claims to be profitable and growing 10% month-on-month.

“The TechCoop opportunity is driven by tech’s enablement of more efficient financial and operational linkages in an inherently complex, multi-stakeholder supply chain,” said Eddie Thai, co-founder and general partner at Ascend.

“We’ve long recognized the need for this, but it wasn’t until encountering the TechCoop founders that we found the folks to back, particularly lead founder and CEO Hao Diep, whose prior experience virtually predestined her for this pursuit today.”

TechCoop provides integrated trade, digital financing, and advisory services with a view to multiplying benefits through an ecosystem effect. For example, it can help a farmer acquire an internet-of-things (IoT) tool for crop monitoring by not only facilitating financing but securing offtake partners for the expected increase in yield.

Thai sees upside in this model in the imbalanced nature of the agriculture industry in Vietnam, which accounts for 30% of employment in the country but only 12% of GDP. This discrepancy reveals the plight of the smallholders, who lose out on revenue and profits due to organisation and distribution challenges.

TechCoop has a 5% stake in each of three local partners and rights to acquire them in the future. There are more than 200 organisations such as buyers, suppliers, and exporters – referred to as “anchors” – on the platform, which indirectly connects some 200,000 farmers. Annualised revenue was tracking at USD 100m at the time of the Series A.

“I hope that with this round the company can reach USD 300m-USD 500m in one to two years,” Thai said. “We think this is quite achievable without having to expand the number of anchors one-to-one, as there is substantial revenue expansion potential among even the initial anchors.”

The plan is to focus on export-related operations, which have proven to provide optimum gross margin for both TechCoop and its partners. Development of an enterprise resource planning (ERP) system tracking all the counterparties on the platform is a priority. Expansion areas otherwise include IoT, precision agriculture, and technologies that help minimize risks in crop cultivation.

“They have the industry knowledge, execution ability in operations and finance, relationships, and more required to achieve this massive and complex vision,” Thai said.

“There are a lot of details to consider when looking at something like this, but one simple yet key factor for us was how TechCoop is working primarily with and through farming organizations, rather than directly with smallholder farmers. Much more efficient, effective, scalable.”