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SaaS isn’t always the answer: The case for physical innovation in developing economies

When I first entered the startup world, like many others, I was convinced that the holy grail of innovation was Software-as-a-Service (SaaS). The logic was simple: SaaS is scalable, asset-light, and investor-friendly. But experience has taught me that impact—real, tangible change—often comes not from what’s hosted in the cloud, but from what reaches the ground.

In emerging markets like Indonesia, startups that deal with physical products often face more friction—regulatory, logistical, or financial. Yet it is these startups that are bridging the most vital sectors of our time: agriculture and healthcare. They don’t just solve problems; they solve survival.

The overlooked power of physical innovation

Today, food security and public health are no longer siloed issues. They’re deeply interconnected. According to the World Bank, disruptions in agriculture directly undermine nutritional access, increasing the burden on already strained health systems. Meanwhile, the World Health Organisation emphasises the importance of food systems in preventing malnutrition and diet-related illnesses.

In this context, startups that innovate in the overlap between these sectors—what I call the AgriHealth frontier—are not only relevant, they are essential. Imagine IoT-enabled soil sensors that optimise micronutrient delivery in crops, or solar-powered cold chains that transport vaccines and fresh produce to remote areas. These aren’t futuristic dreams—they’re prototypes being tested today.

Why the world still needs physical products

The startup world’s obsession with SaaS has, to some extent, blinded us to the enduring value of hardware and physical goods. But here’s the truth: in many rural regions, digital-only solutions fall flat. Farmers need sensors they can touch, irrigation pumps they can repair, and clinics need mobile diagnostic kits that work offline.

Also Read: Unlocking agritech’s potential: Can Southeast Asia rise to the challenge?

The World Economic Forum highlights that hybrid solutions—integrating digital tools with physical infrastructure—are driving the next wave of social innovation, especially in food and health security. Startups that combine data-driven insights with deployable products are not only viable—they’re resilient.

Startups in the middle

We are seeing a new breed of entrepreneurs emerge. They don’t call themselves “agritech” or “healthtech.” They build solutions where tractors meet tablets, where wearable devices meet water pumps. These are startups that operate at the intersection, the Venn diagram middle, where creativity meets critical need.

And yes, their products are often physical.

The human side of innovation

As a founder, I’ve seen first-hand the trust a community places in something they can see, feel, and use. A farmer may not fully grasp blockchain, but she understands a smart scale that tells her when to harvest. A clinic in a remote area may not be paperless, but it will embrace a low-cost diagnostic device if it saves lives.

Innovation is not just about disruption—it’s about empathy. It’s about meeting people where they are.

In closing: It’s time to rethink what’s “sexy”

Let’s stop thinking SaaS is the only smart choice. Let’s start building what the world actually needs. At the heart of food systems, climate resilience, and health equity lies a quiet truth: physical solutions are not outdated—they’re just underfunded and underestimated.

And in the era of AgriHealth, they may just be our best hope.

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Jiva’s story: A turning point for corporate venture building in agriculture

The recent closure of Jiva, a venture that reached over 200,000 farmers and created more than 600 jobs, marked the end of a chapter in agri-venture building in Southeast Asia. While some might view it as just another corporate experiment that didn’t succeed, doing so would overlook its contributions and the lessons it leaves behind.

In today’s environment of constant disruption, stepping back entirely from innovation carries its own risks. The real challenge for corporations is to make their innovation processes more efficient, effective, and resilient—so they can build new businesses that thrive in tomorrow’s markets.

Unlike VC-backed startups such as Crowde or even eFishery, Jiva was a bold corporate-led effort to reimagine how farmers in Southeast and South Asia could access services. It was endowed with resources and talent, an ambitious venture that ultimately cost its corporate sponsor more than US$100m over five years.

And even though it didn’t reach its full potential, Jiva leaves us with important lessons for the next wave of corporate venture building as well as hints of an answer to the question on the minds of every executive: how do we achieve more with less?

What Jiva revealed

Jiva was conceived in a different time: easy money, high-risk appetite, and a preference for growth over validation. As the funding climate shifted, the model came under strain and exposed some important realities:

  • Big spending alone isn’t a shortcut. While resources matter, heavy upfront investment and reliance on consultancies can sometimes create distance from the market, making it harder to adapt. While at the same time reduces the ability of institutional investors to justify significant early spend without traction.
  • Overhead must match the stage. Large teams and high-cost structures can put too much pressure on ventures that are still finding product-market fit. And, specifically for agriculture, they often miss the fact that real impact is done on the ground and not in an HQ in a country away.
  • Subsidies aren’t a long-term solution. Farmers appreciated short-term benefits, but long-term traction only comes from solving real pain points. This is true in every industry, but especially with those dealing with cutthroat competition like agri distribution. In Southeast Asia, rice subsidy programs have shown limited sustainable impact on productivity, prompting calls for more enduring, market-based solutions.

Rather than being a failure, Jiva provided a live stress test for a certain approach to venture building—and showed why a new playbook is needed.

Also Read: The agritech challenge in Indonesia: Can AI and mobile apps enhance productivity?

What the next playbook looks like

If Jiva were launched today, it would likely look quite different. Corporates entering this space can take away some clear principles:

  • Start lean, think like startups. Small bets, early proof, and traction as the real validation. A corporate startup should be able to leverage its corporate advantages and leverage it to be as cost-efficient as possible, rivalling a venture in the wild capital efficiency. Spending money in the early days should be around pilots and not decks.
  • Choose partners who share the risk. Collaboration works best when incentives are aligned and everyone has skin in the game. Venture Builders partnering with corporations should offer more than slides, and be willing to invest in their work.
  • Stay close to the ground. In agriculture, credibility comes from rolling up sleeves and working alongside farmers. More than 80 per cent of Southeast Asia’s farmers are smallholders, operating on less than two hectares. Reaching them requires hyper-local trust, which can’t be built from a distant HQ. Normally, high level personnel is used to managing a large team and not spending time on the ground. 
  • Fund with discipline. Stage-gated capital, realistic milestones, and equity structures that drive accountability. PitchBook data shows corporate venture funding fell 35 per cent in 2023 as boards demanded tighter capital discipline. Stage-gated funding mirrors this new normal. Over spending without a view towards profit belongs to the previous era of VC (an era I hope does not come back again), and corporates especially can be more disciplined in how they manage a new business funding.
  • Focus on solving pain points. Sustainable models don’t rely on subsidies; they rely on real value creation.

Also Read: Why agritech is the key to Asia’s food security

Why corporates still matter

Despite the challenges, corporations remain uniquely positioned to help tackle agriculture’s biggest issues. Their networks, balance sheets, and deep industry knowledge can give new ventures an edge that startups alone can’t achieve. But that edge only exists if it translates into faster, cheaper, and more effective execution than what a startup could do “in the wild.”

Jiva also showed how that edge can be dulled when overhead grows or distance from the market increases.

The opportunity now is to reset the model: build leaner, partner smarter, and focus relentlessly on genuine farmer impact.

Jiva should be remembered not only as an ending, but as a significant effort that provides valuable lessons for the next era of corporate venture building in agriculture.

Done right, corporations can still play a decisive role in creating ventures that deliver both returns and resilience for the region’s food systems. 

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Homegrown solutions for a hungry future: Why Southeast Asia must localise agritech by 2050

According to calculations from Our World in Data, the global population grew by 31 per cent between 2000 and 2023, while global rice production increased by 33.7 per cent. Meanwhile, these figures suggest that rice productivity has outpaced population growth over the past 23 years, but they do not guarantee food security by 2050.

A report by the World Resources Institute (WRI) Indonesia indicates that agricultural productivity must increase by at least 100 per cent to meet global food demand by 2050. Without optimisation, food scarcity and hunger could worsen due to uneven distribution, climate challenges, declining agricultural labour, and varying productivity across regions.

For instance, Thailand faces a shrinking young farmer population (ages 15–40), which dropped from 48 per cent in 2013 to 32 per cent of total farmers, alongside severe droughts in areas like Phi Phi Island, Pattaya, and Koh Chang. 

The Philippines struggles with climate volatility, leading to erratic harvests and suboptimal land use. 

Indonesia grapples with small-scale farming dominance, declining generational turnover in agriculture, and poor market access for farmers.

On the other side, according to the graphic above, Southeast Asia leads global rice production, followed by Africa, the Americas, Europe, and Australia. Countries like Vietnam, Thailand, and Cambodia are key exporters, making regional production stability critical for domestic and international supply chains.

However, achieving global food security requires tailored solutions for each region. Technological adaptation and not just adoption is basically the key to reaching the ultimate goal, that is food security.

The role of localised agritech in boosting productivity and distribution

Farming tech is getting smarter, but for many Indonesian farmers, it’s still out of reach.

The problem is not that they do not want it; it’s that the price tag can be jaw-dropping. FlyeEye, for instance, says a sprayer drone costs around US$18,000–22,000 (IDR 290–350 million), while a crop-monitoring drone is about US$13,000–15,000 (IDR 211–244 million).

Also Read: Why agritech startups will call for the next e-commerce revolution

With costs like these, smallholders are often locked out of the tech revolution. Many still rely on traditional methods such as planting, watering, and harvesting in ways that can be time-consuming, less efficient, and harder to sustain in the long run

This is why the real conversation shouldn’t just be about which technology to use, but how to make it accessible and relevant. For example:

  • Precision farming: Instead of pricey sensor networks, farmers can use smartphone-based mapping apps, shared sensors, or low-cost soil test kits.
  • Smart irrigation: Full IoT setups are great, but smaller options like solar pumps, moisture controllers, or community-managed systems are more realistic.
  • Digital marketplaces: Fancy apps work best when paired with simple solutions like SMS ordering, e-vouchers, or local aggregation points.
  • Post-harvest tech: Community cold rooms, pay-per-use storage, or solar dryers can do a lot without the massive upfront cost.

The key is finding the right mix of tech, financing models, and local know-how, whether that’s renting equipment, joining a cooperative, or paying only when you use the service. After all, one size doesn’t fit farms; what works for a Sumatra rice farmer won’t necessarily suit a Thai sugarcane grower or a Filipino coconut producer.

With 62 per cent of Indonesia’s farmers operating at a small-scale level, we face a significant structural challenge in agricultural development. These smallholder farmers typically focus on immediate, short-term gains and use harvest income primarily for daily subsistence rather than reinvesting in future production cycles. This subsistence mindset creates a critical barrier to developing sustainable farming businesses.

To address this challenge, comprehensive intervention programs are needed. Reliable institutions including agribusinesses, startups, and vocational training centers, must take an active role in providing ongoing mentorship, promoting sustainable business practices, enhancing financial literacy, and teaching business scalability principles.

These efforts are crucial because many smallholder farmers currently lack understanding of long-term investment returns, less knowledge of business growth strategies, and minimal access to financial management tools.

Also Read: Revitalising Indonesian agriculture: Unlocking potential through practical technology innovation

By implementing these educational initiatives, we can help transition subsistence farming into viable, growth-oriented agricultural enterprises.

On the distribution front, supply chains play a critical role in ensuring agricultural products reach people’s tables. In line with the SDGs’ goal to strengthen food security, it is equally important to ensure that distribution processes are efficient. In a geographically complex country like Indonesia, which consists of thousands of islands, distribution presents a major challenge. 

Even established agri-e-commerce platforms such as Sayurbox and Segari currently operate only in select cities and have yet to reach the broader Indonesian market, largely due to geographic barriers. Additionally, the high costs of maintaining production facilities, warehouses, and delivery systems often push these platforms to focus only on cities with stronger purchasing power, where the returns justify the budget and effort. Expanding into smaller cities would make the costs disproportionate to the potential gains.

This situation highlights the urgent need for more localised platforms to emerge across different regions to bridge the gap. 

Moreover, this gap highlights the critical need for investment to support small-scale farmers, improve productivity, and ensure long-term agricultural sustainability.

Investor’s role: Social and economic impact

Investors like impact funds, angel investors, and VCs can drive scalable agri-tech solutions with dual benefits:

Social impact

  • Strengthens local food resilience and reduces import dependency.
  • Attracts youth to farming through tech-driven opportunities (e.g., drones, AI).
  • Boosts rural economies via digital literacy and job creation.

Economic impact

  • Taps into underserved smallholder markets with high ROI potential.
  • Streamlines supply chains, increasing margins for farmers and startups.
  • Enables regional scaling across SEA due to shared agricultural challenges.

On the other hand, to have a good risk mitigation system for investors there has to be something like conducting rigorous due diligence, including on-site visits to verify operations. Then, monitor farmer-business partnerships and audit financial health via third parties. After that, acknowledge seasonal fluctuations and profitability isn’t always linear.

Preparing for 2050 is not only about higher yields but it is about smarter farming and fairer distribution. Southeast Asia doesn’t need imported fixes; it needs homegrown innovations built by those who understand its fields, weather, and markets.

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Digital farming’s false promise: Why Asia’s US$180B bet on agritech-driven farming is failing smallholders

Thailand’s agricultural struggles ripple far beyond its borders. As global rice prices surge 47 per cent following climate disruptions and geopolitical instability from the Ukraine conflict, Thailand’s productivity stagnation carries implications beyond domestic food security. The kingdom’s 3.1 tons per hectare yield represents lost export revenue of approximately US$2.3 billion annually compared to Vietnam’s efficiency rates, according to commodity trading data.

This productivity gap undermines Thailand’s position as the world’s third-largest rice exporter at a critical moment when global food systems face unprecedented strain. While competitors like Vietnam achieve 5.8 tons per hectare through targeted agritech investments, Thailand’s billion-dollar Smart Farmer program has delivered minimal returns — a cautionary tale as global agricultural investment climbs to 43 billion annually.

The paradox of connected farming

Farmers like Somchai Thanakit, a third-generation rice farmer in Thailand’s Pathum Thani province, embody the paradox facing countless smallholders caught between the promises and pitfalls of digital farming. He owns a smartphone worth more than his monthly income.

Through government programs and private partnerships—most notably Kasetsart University’s SMART Platform—his 2.3-hectare plot has been introduced to ‘smart’ tools: soil sensors measuring moisture, satellite imagery used to track crop health, and mobile apps providing weather and market updates.

Yet Thanakit’s yields have stagnated at 3.2 tons per hectare for three consecutive seasons—well below the 5.5-ton national target and far from Vietnam’s average of 5.8 tons per hectare, according to FAO statistics.

“I get so many notifications, I don’t know which ones to trust,” says Thanakit, echoing a sentiment heard across Asia’s rice bowls. “My father knew when to plant by watching the sky. Now I have five apps telling me different things.”

This disconnect between digital promise and agricultural reality represents a broader crisis in Asia’s approach to agricultural modernization.

The scale of misalignment

Since 2010, ASEAN countries have invested approximately US$180 billion in agricultural modernisation initiatives, including digital infrastructure, according to the Asian Development Bank’s agricultural investment database.

Since 2017, Thailand has channeled an estimated US$12 billion into transforming its agricultural sector, a cornerstone of the nation’s ‘Thailand 4.0’ strategy. A significant portion of this investment has been directed towards government-led initiatives, most notably the ‘Smart Farmer’ program.

Also Read: Indonesia’s agritech landscape: Keys to building a scalable agriculture startup

Despite this investment, productivity gains remain modest. Thailand’s agricultural Total Factor Productivity (TFP) grew just 0.8 per cent annually between 2015-2023, according to World Bank data—insufficient to meet the 2.1 per cent growth needed to ensure food security for Asia’s growing population by 2050, as outlined in the International Rice Research Institute’s latest projections.

The problem is particularly acute among smallholders, who represent 80 per cent of Asia’s 200 million farm households but receive less than 15 per cent of agritech investment, according to McKinsey’s 2023 agriculture report.

Thailand’s digital divide

Thailand exemplifies both the promise and the shortcomings of agricultural digitalisation. As the world’s third-largest rice exporter and the global leader in durian exports, the kingdom also holds dominant positions in rubber, cassava, and tropical fruit markets. Its agricultural sector employs 32 per cent of the workforce and contributes 8.2 per cent to GDP.

Yet productivity lags. Thai rice yields average 3.1 tons per hectare compared to China’s 6.7 tons and Vietnam’s 5.8 tons, according to FAOSTAT 2023 data. Post-harvest losses in fruits exceed 30 per cent, and 40 per cent of smallholder farmers remain without access to formal extension services, according to Thailand’s Ministry of Agriculture and Cooperatives.

The government’s response has been to digitalise. The Smart Farmer program, launched in 2017, aims to connect 2.8 million farmers through mobile platforms providing weather data, market prices, and agricultural advice. To date, 1.2 million farmers have registered, but active usage remains below 25 per cent, according to program data obtained through freedom of information requests.

The design problem

The core issue isn’t technological but anthropological. Most agritech platforms are designed by urban engineers for farmers they’ve never met, creating tools that are technically sophisticated but practically useless. This is starkly evident in Thailand’s own flagship digital initiatives.

For example, the government’s Smart Farmer program provides a platform with weather data and market prices, yet less than 25 per cent of its 1.2 million registered users are active. The reason is not a lack of technology, but a failure of design.

Farmers like Thanakit are left overwhelmed by multiple, often conflicting, notifications rather than being empowered with clear, actionable advice. The platforms create information overload instead of solving problems. It exemplifies a challenge common across the sector: building digital ‘Ferraris’ for farmers who simply need reliable ‘bicycles’ to address their immediate, practical needs.

Algorithmic dependency

The digitalisation push has created new vulnerabilities. When severe flooding disrupted internet connectivity across central Thailand in October 2023, thousands of farmers lost access to planting schedules and irrigation controls managed through cloud-based systems.

This highlights what agricultural economists call “algorithmic dependency”—the gradual erosion of traditional farming knowledge as decisions migrate to digital platforms. A 2023 study by Kasetsart University found that farmers using automated irrigation systems for more than three years showed decreased ability to manually assess soil moisture compared to control groups

This creates a fundamental paradox: digital tools designed to enhance productivity may actually undermine the agricultural autonomy and traditional expertise that enable farmers to adapt to changing conditions

The challenge extends beyond simple technology adoption to questions of whether sustainable productivity gains can coexist with the preservation of essential farming skills “We’re creating digital sharecroppers,” warns Dr. Nipon Poapongsakorn, a agricultural economist at the Thailand Development Research Institute. “Farmers become dependent on platforms they don’t control, using algorithms they don’t understand.”

Promising alternatives

Some startups are pursuing different approaches. Bangkok Silicon, a Thai agritech startup founded in 2021, has completed development of voice-based solutions in local dialects and is preparing for distribution to farmers across Thailand. Their AI assistant “BKS Agrichat, tentatively called “Kruu Naa”,” trained through extensive field research with farming families across dozens of provinces. It provides simple binary recommendations rather than complex data dashboards.

Also Read: How Southeast Asia’s agritech startups are turning smallholder farms into high-tech powerhouses

Similarly, India’s CropIn has developed “contextual intelligence” systems that consider local farming practices, weather patterns, and cultural preferences.

Policy recommendations

Addressing agricultural digitalisation’s failures requires systemic changes:

  • Farmer-centred design: Mandate user research with actual farmers before deploying digital tools. The Thai government should establish design standards requiring extensive field testing with target users.
  • Local data sovereignty: Critical agricultural data should be stored and processed within national borders. Thailand’s proposed Personal Data Protection Act should include specific provisions for agricultural data.
  • Integration over innovation: Rather than launching new platforms, focus on integrating existing tools with established systems like cooperatives, banks, and extension services.
  • Digital literacy investment: Expand rural digital education beyond basic smartphone use to include critical evaluation of digital information—essential as farmers navigate competing recommendations.

The path forward

Agricultural digitalisation isn’t inherently flawed, but its current trajectory serves technology companies more than farmers. Success requires shifting from technology-push to demand-pull innovation, prioritising farmer autonomy over data collection.

Thailand, with its strong agricultural base and growing tech sector, is well-positioned to lead this transition. But it must abandon the assumption that more technology automatically means better farming.

The goal shouldn’t be to make farmers more digital, but to make digital tools more agricultural. Only then can Asia’s agricultural revolution move from the conference room to the rice field.

Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic.

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A new era of impact: Beyond the bottom line in Southeast Asia’s tech revolution

We’ve witnessed firsthand how a new generation of entrepreneurs in Southeast Asia (SEA) is redefining success. Growth is no longer measured solely by speed or scale, but by the depth of impact. The shift from asking ‘How fast can it scale?’ to ‘How meaningful is its contribution?’ is a growing debate in Southeast Asia, one that is increasingly shaping how entrepreneurs, investors, and policymakers define success.

Across the region, impact-oriented investors are increasingly adopting a ‘Theory of Change’ approach that channels capital toward technology solutions addressing Southeast Asia’s most pressing challenges. At TNB Aura, this lens guides much of our investment activity. Based on our 2024 Impact Report, our largest investment sectors are 37 per cent consumer and retail/e-commerce, 23 per cent agritech, 13 per cent edutech, and 12 per cent healthtech, reflecting the areas where technology is delivering the most meaningful and measurable impact.

Consumer and retail: Breaking access barriers

Across SEA, millions living outside Tier 1 cities face limited access to basic goods and services. Infrastructure gaps mean essentials cost more and are harder to find, leaving underserved communities at a disadvantage.

Without innovation, this inequality would persist. Super is changing that through its social commerce group-buy model, which aggregates community demand to lower prices and improve distribution. In 2024, Super engaged more than 40,000 active agents coordinating group buying and end consumers who purchased directly from the platform. By reimagining last-mile access, Super has enabled goods that were once out of reach to become part of everyday life for households in remote areas.

Agritech: Building resilient food systems

Millions of small-scale farmers form the backbone of SEA’s food supply, yet most remain trapped by systemic inefficiencies. Left unaddressed, these challenges would continue to depress productivity and incomes.

In agritech, new digital platforms are flipping this reality, creating market access and supply chain efficiencies. TNB Aura’s portfolio companies, such as Eratani and Techcoop, are among those helping farmers secure fairer prices and more sustainable practices. In 2024, Techcoop improved the livelihoods of 233,250 farmers through expanded market access and input financing. Collectively, our portfolio has supported 209,000 small-scale enterprises, many of them farmers now participating in more equitable and efficient food systems.

Also Read: Built for all or built to fail? Why tech for social impact must start with inclusion

Edutech: Expanding quality learning

For students across SEA, geography and cost have long dictated educational opportunity. The challenge is not just about access, but about the quality of education available to students from diverse socioeconomic backgrounds. Without intervention, this gap would only widen with each generation.

Edutech innovators across the region are tackling this challenge head-on. One example is VUIHOC, which delivers affordable online learning to underserved students in Vietnam. Its dual-teacher live-streamed classes reach nearly 2,000 students at once, while its AI-powered platform personalises learning and provides an extensive library of resources to over a million more each year, demonstrating how tech can fundamentally transform a country’s educational landscape.

Healthtech: Closing the care gap

Healthcare inequality is one of SEA’s starkest divides. Rural and remote communities often lack access to even the most basic consultations, forcing patients to travel long distances or go untreated.

Technology has emerged as one of the most powerful tools for democratising healthcare in Southeast Asia. Our portfolio includes companies like Ora, which leverage digital platforms to expand access, offering affordable, timely medical consultations and delivering essential supplies that would otherwise remain out of reach. Ora delivered 63,750 online consultations in 2024.

Also Read: Why investors are betting big on Asia’s social impact startups

A deliberate and data-driven approach to impact

These individual successes point to a broader, deliberate trend: investments in the region are increasingly aligned with both financial value creation and measurable impact. Looking ahead, investors are doubling down on development-eligible countries and climate resilience, with many, including TNB Aura, allocating significant capital to these priorities.

We challenge the traditional view that impact investing is a concession. Instead, we see it as the most strategic and sustainable way to build category-defining businesses in the region. By focusing on the sectors that truly matter and by backing the founders who are solving real problems, we are not just investing in companies; we are investing in a better future for Southeast Asia.

This article was co-authored by Amanda Nway Htwe, Corporate Development and Sustainability Manager at TNB Aura, and Jessie Cruz, Value Creation Analyst at TNB Aura.

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