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🍌 This banana empire collapsed
How Greenikk died because of fake PMF (it was too late to pivot)
Admond Lee
October 06, 2024
Hey Founders,
Welcome to The Runway Ventures — a weekly newsletter where I deep dive into failed startup stories to help you become the top 1% founder by learning from their mistakes with actionable insights.
Today’s failed startup was in the banana business. Let’s get to it! 🚀
Today at a Glance:
☠️ 1 Failed Startup → Greenikk
⚠️ 2 Mistakes → No product-market fit (PMF)
🧠 3 Lessons Learned → PMF = Retention
🔗 The Runway Insights → How to market a product you don’t use
💰 Southeast Asia Funding Radar → Clout Kitchen raises $4.45M co-led by a16z Games' Speedrun and Peak XV's Surge
☠️ 1 Failed Startup: Greenikk
🚀 The Rise of Greenikk
Founded in 2020 by Fariq Naushad and Previn Jacob Varghese, Greenikk wanted to revolutionise the banana industry in India by creating a full-stack banana system that would digitise the entire banana value chain.
The Problem — 🧑🏻🌾 Banana farmers face significant challenges in banana farming, including low productivity, lack of financial resources, and inadequate market access.
In short, the banana farming market was very inefficient.
The Solution — 🙌🏻 Greenikk provided a comprehensive solution that connected farmers directly to markets while offering them the financial tools they needed to succeed.
It established Enablement Centres across major banana-producing regions, providing crucial support services.
This included everything from financing and crop advisory to weather forecasts and market linkages.
Their goal was to solve the myriad problems faced by stakeholders in the banana value chain—from farmers and processing units to bulk B2B buyers.
🍌 The Vision
They envisioned a digital ecosystem where banana farmers could thrive through access to financial assistance, quality seeds, crop advice, insurance protection, and market connections.
The vision was to become the "DeHaat for banana cultivation", akin to a comprehensive agricultural service provider.
 | Greenikk wasn't just another agritech startup. It was a lifeline for banana farmers 🛟 Because of its innovative approach, Greenikk got huge attention and traction 🌊 |
Riding on its remarkable growth, Greenikk grew by 300% in 2022, generating sales of ₹1.58 crore (~$200k). They had ambitious plans to reach out to 50,000 farmers within 15 months and were projected to end of 2023 with sales of ₹6 crore (~$800k).
🔥 That’s 4x revenue within 1 year.
💰 At its peak, Greenikk raised around $643k from notable investors like 100Unicorns, IIM A Ventures, Mastermind Capital, and prominent angels. Their momentum seemed unstoppable as they prepared for a Series A funding round aimed at raising an additional $5 million with their traction:
Provided jobs to 30+ employees and 150+ women artisans.
Helped 5000+ agriculture stakeholders go digital, moving ₹120+ crore from cash to digital.
Converted 500 tons of banana waste into fibre and traded 10,000+ tons of bananas, giving farmers better prices.
Traction was great. Excitement was sky-high. Greenikk was poised to become a major player in the agritech space in India.
📉 The Fall of Greenikk
Huge receivables were stuck from certain clients as they resisted paying after reaching a significant amount.
However, building startups in India is not easy (as you can see from other failed startups in India), and Greenikk was no exception.
💸 Despite initial growth, Greenikk hit a wall due to a critical issue — loan defaults. Even worse, it was stuck in this financial services arm as it couldn’t scale other verticals.
📌 Here’s what happened to Greenikk:
☀️ The Good Days
Jan 2020 — Greenikk was founded by Fariq and Previn.
Built enablement centres (EC) to provide farmers with financing, seeds, crop advisory, insurance coverage, agri inputs, weather forecast, and market connect.
2022 — Achieved 300% growth with sales of ₹1.58 crore (~$200k).
💰 Raised ₹5.4 crore (~$643K) in pre-seed funding from 100Unicorns, IIM A ventures, Mastermind Capital, Smart Sparks and other angels such as Mayank Tiwari of ReshaMandi.
🌈 Agritech was at its peak + Low-interest capital = Easy money
⛈️ The Bad Days
Late 2023 — 💸 Loan defaults escalated. Business losses mounted.
Greenikk extended loans worth ₹6 crore (~$720k) to farmers, but many borrowers failed to repay.
This created a snowball effect of financial losses, with mounting receivables that the company struggled to collect.
They spent 6 months trying to recover around 80% of the defaulted amount, but the damage was done.
Jan 2024 — 💰 Raised another ₹3 crore (~$362k) from 100Unicorns.
Greenikk sought to raise a $5 million Series A round but failed to find investors.
The funding landscape had shifted drastically, and without PMF, Greenikk couldn’t sustain its operations.
Even worse, banana farmers primarily saw them as a working capital provider, not as a comprehensive solution for their needs, further limiting their scalability.
As a result, investors said NO because they were doubtful of getting the promised returns given its current model in the agritech domain.
30 Sep 2024 — 🥺 Fariq announced on LinkedIn of shutting down Greenikk due to high loan defaults and financial losses.
Farid later admitted that they had chased the wrong metrics for growth and failed to pivot effectively when market dynamics shifted.
As they prepared to shut down operations, Greenikk returned 50% capital to its investors while offering 2-month severance packages to their remaining employees.
We may be able to build a low profitable business but justified VC level returns to our investors was not possible.
Greenikk’s mission was noble. The societal impact was real. Traction was great. But it’s extremely tough to scale the business meaningfully as a VC-backed startup.
In the end, Greenikk died because they couldn’t hit product-market fit (PMF) given the remaining runway.
Farewell LinkedIn post by Farid (co-founder of Greenikk)
Want to learn more about Greenikk’s downfall?
⚠️ 2 Mistakes
Mistake 1: No product-market fit
Initially, we had tons of inquiries, and it looked like demand was booming. But it wasn’t real—it was created… After a few deals, they didn’t come back. The truth? They already had other sources of working capital… We even tried selling to mandis, buying at INR 38 per kg, only to sell at INR 35 per kg because traders manipulated prices. The more we dealt with them, the more we realised this was a dead end—and we stopped scaling there.
🤔 Remember the 300% growth in 2022? Based on Previn’s sharing, it was because their customers only saw them as “another vendor offering working capital” instead of an ecosystem facilitator that provided end-to-end agricultural services.
🤑 In short, farmers or traders only wanted to borrow money from Greenikk and nothing else. Once they had other sources of working capital, they stopped dealing with Greenikk 👋🏻
😮💨 Here’s the dilemma:
Greenikk gave loans to banana farmers and achieved high growth.
Loan defaults became higher and higher because farmers couldn’t repay.
If Greenikk stopped giving loans, it couldn’t grow because farmers didn’t want to use its other services.
In the end, Greenikk had no choice but to pivot in March 2023 and started focusing on working with artisans and farmers to build handicrafts and textiles from the waste material produced in the banana farming process.
However, since Greenikk was already losing money due to loan defaults, it didn’t have enough capital to scale this business (after the pivot) and it couldn’t fundraise from investors due to market conditions.
🍌 Basically, Greeniik was stuck with an unscalable business and a diminishing runway.
Mistake 2: Over-reliance on financial services to grow
Greenikk extended loans worth ₹6 crore (~$720k) to farmers, but many borrowers defaulted. This over-reliance on financial services created a snowball effect of losses, as they struggled to collect receivables.
Instead of diversifying their offerings, they became too focused on being a working capital provider (or at least this is how customers perceived them).
In the end, even when Greenikk pivoted away from offering financial services, it was too late.
🧠 3 Lessons Learned
Lesson 1: PMF = Retention
Greenikk didn’t achieve true PMF because they misunderstood what their customers really valued. Its initial growth was a “fake” PMF in disguise. It seemed that their customers weren’t after a complete agricultural solution — they just needed some money.
🌟 Key Takeaways:
🚨 Don’t mistake initial demand for product-market fit
Validate whether your customers need your full solution or just one aspect of it. If the latter is true, you risk losing them to competitors offering that single feature.
Test the stickiness of your product. Ask yourself, “Will they still use us if I remove X feature?”
If the answer is NO, you’re probably too reliant on that one thing and need to diversify your value proposition.
Imagine running a marketplace for organic foods. If people only come for your discounts and leave once those vanish, you’re missing PMF. You need to dig deeper to find out what would make them stay long-term (i.e. superior product selection, delivery speed).
🔥 PMF = Retention
I recently read this book (Fall in Love with the Problem, Not the Solution) written by Uri Levine — the co-founder of Waze which Google acquired in 2013 for $1.15 billion.
One of the insights I learned from this book is that PMF is all about retention.
If you don’t have retention, you don’t have PMF. And if you don’t have PMF, you’ll die.
This book is truly a handbook for entrepreneurs — highly recommended!
Lesson 2: Diversify revenue streams
Greenikk leaned heavily into the loan business to grow, but that strategy backfired big time.
🌟 Key Takeaways:
🥚 Don’t put all your eggs in one basket.
Consider how you can offer complementary products or services that can generate income without relying solely on one aspect of your business.
Before fully committing to a new revenue stream, run pilot programs or MVPs to gauge interest and feasibility.
For example, a food delivery startup might start with restaurant partnerships but could later explore meal kits, grocery delivery, or subscription services to diversify its income sources.
Lesson 3: Pivot fast
Greenikk eventually realised they were stuck in a dead-end business model. They tried to pivot in March 2023 by moving into banana waste handicrafts, but by then, it was too late. The damage from loan defaults had already piled up, and they lacked the capital to scale their new venture.
A slow pivot sealed their fate.
🌟 Key Takeaways:
⚠️ Listen to early warning signs
If customers aren’t sticking around after a first purchase or using your product in a way you didn’t intend, something’s off.
Regularly track key metrics like customer retention, churn, lifetime value (LTV), and conversion rates.
Set thresholds where, if numbers drop below a certain point, you have a system in place to immediately review and adjust your strategy.
📊 Trust the data, not your ego
Define KPIs that clearly show whether your current strategy is working.
If the data isn’t aligning with your success metrics, don’t wait for things to “turn around” on their own. They won’t. Be prepared to cut losses and shift focus.
🔗 The Runway Insights
💰 Southeast Asia Funding Radar
Clout Kitchen raises $4.45M co-led by a16z Games' Speedrun and Peak XV's Surge (Link)
Rey, an Indonesian insurtech, raises $3.5M seed extension (Link)
DOON, a Philippine car-sharing platform, raises $1.5M pre-seed (Link)
Truely, a Singapore-based eSIM provider, raises $3.5M led by 1982 Ventures (Link)
Salmon secures $30M in Series A-2 financing round to expand financial services in Southeast Asia (Link)
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That’s all for today
Thanks for reading. I hope you enjoyed today's issue. More than that, I hope you’ve learned some actionable tips to build and grow your business.
You can always write to me by simply replying to this newsletter and we can chat.
See you again next week.
- Admond
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