By Kiat Wang Seow and Teddy Peralta

At its core, venture capital is about identifying and empowering companies that tackle complex, high-impact challenges with clarity and precision. In Kita, we saw a company reimagining one of the Philippines’ most entrenched industries—agriculture—with a combination of data-driven innovation and operational excellence.

Agriculture contributes over 8-9% of the Philippine GDP (>$40 billion annually) (Philippine Statistics Authority, 2024), yet systemic inefficiencies across financial services and logistics have stifled its true potential. Our investment in Kita reflects a strategic alignment with our thesis on transforming legacy supply chains through innovative infrastructure and financial technology.

Market
The Philippines’ agricultural sector is fraught with systemic inefficiencies that threaten its long-term viability and the nation’s food security. Despite being the world’s eighth-largest rice producer, the Philippines is paradoxically the largest importer of rice, a clear signal of misaligned production capacity and market inefficiencies.

At the heart of these challenges are structural barriers: low farmer income, fragmented logistics networks, limited access to affordable credit, and an aging workforce. These issues create a compounding effect, stifling productivity and perpetuating a cycle of dependency and underinvestment. For example, vegetable yields in the Philippines average 8.26 tons per hectare (Philippine Statistics Authority, 2022)—far below the regional benchmark of 12.75 tons per hectare (Department of Agriculture, 2022). Addressing these inefficiencies presents a massive market opportunity to modernize the agricultural value chain.

Despite plentiful resources—13.6 million hectares of land for crop cultivation and 5.8 million hectares of arable land (11th most globally) (Statista, 2024)—the Philippines struggles with domestic food supply. The country accounts for 2.8% of global rice production (Global Agricultural Information Network, 2023), however it currently faces regular deficits in domestic capacity.

Worryingly, the average age of the Filipino farmer population is between 57-59 years old (Philippine Statistics Authority, 2023), indicating that the Philippines is facing a labour crisis in its agriculture sector.

The underlying problem can be broken down into two components – most farmers make a very low wage in the Philippines, rendering it an unattractive pursuit, and most farmers lack access to infrastructure that would allow them to innovate and improve their production capabilities and in parallel, their income.

On the first point, farmers make a very small amount from their livelihood at PHP 313 per day or roughly USD 5.73 per day (Philippine Statistics Authority, 2019). Most small-hold farmers don’t earn enough to feed their families and resort to supplemental-income by being tricycle drivers, construction workers, or farmers for other farms.

A large part of this is due to middle-men taking majority of the income generated by the production of a crop. Up to 75% of the end-price that hotels, restaurants, and cafes (HORECAs) pay for vegetables goes to said middlemen because of farmers’ lack of access to market information and heavy reliance on intermediaries. For example, for cabbage, the farmer’s selling price is ~28 PHP/kg, while the end buyer’s price is 100 PHP/kg – a difference of 3.6x, captured by the middle-men.

On the second point, historically farmers have had to use alternative infrastructure to support their farms due to the lack of existing public infrastructure. For example, most farmers are heavily reliant on informal money lenders that charge them exorbitant interest rates for access to financing for agri-inputs such as seeds and fertilizer needed for them to plant crops.

Around 20,020 or 47.6% of all barangays (roughly the equivalent of a town in the Philippines and the smallest unit of government administration) have an individual money lender (most expensive form of credit), while only 334 have access to government banks (cheapest form of credit as subsidized by the government).

As a result, the average farmer is significantly in debt to traders (most individual money lenders) who provide them financing to buy agri-inputs (seeds and fertilizer). The farmer is forced to sell to the same traders at rock-bottom prices come harvest time as the traders also arbitrarily dictate pricing as a condition of their lending, primarily based on gut feel. Farmers also don’t have access to facilities for drying and storing their produce so they can wait for better market prices and lack transportation to bring their produce to markets.

Market Structure
The incumbent supply chain structure broadly follows the following steps:

  • Farmers harvest to sell all their produce and bring said produce to a Trading Post. This is normally a central regional location that can take a day to travel to.
  • Disposers (financiers of the farmers’ agri-inputs prior to the initial planting) take all the farmers’ produce at the Trading Post and sell it to Traders at the trading post. Disposers act as the farmers’ agents at the trading post and dictate price to them based on an arbitrary pricing methodology.
  • Traders (representatives of Buyers – the end-stakeholder) buy from Disposers based on requirements from their Buyers.
  • After Traders and Disposers agree on price, goods are passed on to Assemblers for processing (e.g. washing, trimming, packing).
  • The supply chain then diverges at this point based on if the Trader has its own truck:
  • a. If the Trader does not have its own truck, a Trucker loads the goods onto their truck and transports the items from the Trading Post to the Buyer.
  • b. If the Trader has its own truck, another Assembler (separate from step 4) loads the goods onto the truck. The Trader then transports the goods to the Buyer.



    • The Opportunity
    The Philippine government is acutely aware of the issue and has made improving the current situation a flagship project of the current administration. Under the current iteration of the Philippine Development Plan (PDP) 2023-2028, the government plans to improve productivity of agricultural facilities through technology and systems reform, create better distribution and access to markets, and strengthen the resiliency of the existing supply chain.

    The government is implementing key legislation to help alleviate this including increasing the allocation of government banks and farming insurance institutions, improving trading and storage facilities, creating access to grants, and strengthening farming cooperatives among other measures.

    Kita’s Solution
    Kita is currently modernizing the infrastructure layer of the agricultural industry in the Philippines in coordination with existing stakeholders with the goal of providing farmers with better distribution, access to cheap and usable credit to amplify their farming output, clearer price transparency.

    Kita intervenes at three different stages of the supply chain.

  • Horeca trading – Kita purchases directly from small hold farmers and then sells to HORECAs. This eliminates a significant chunk of the middle-men within the current supply chain, allowing farmers and end-buyers to capture more value.
  • Trading Post Digitization – Kita is digitizing the trading posts (where all buying and selling of produce from farmers is done) in the Philippines to create a standardized and streamlined bidding system and accurate measure of quantity of goods. This creates a fair and transparent pricing system, allowing for true market pricing as opposed to the current system where certain agents are able to dictate price arbitrarily and small-hold farmers are purely price-takers. Kita is then able to leverage its role at the heart of the trading operation to receive transaction data for step 3.
  • Agri-Inputs financing – Kita is creating a closed loop agri-inputs financing business in partnership with key banks. Currently these banks find it difficult to lend to farmers because of a lack of data for underwriting and proper distribution channels to reach the farmer.
    Kita provides a credit score via the trading post data that will be used to underwrite loans issued by its onboarded lenders and more importantly, a closed loop system wherein the bank lends to farmers directly in agri inputs as opposed to cash and then gets paid back when the farmer sells the goods at the trading post.



    • This significantly reduces the risk that funds will be misused or that a farmer does not pay the loan back. Because transactions both on the disbursement and payment side (via the trading post) are processed by Kita in conjunction with the bank, they can automatically deduct and repay the principal, leading to significantly lower rates of abuse of capital.

    Kita’s intervention addresses both upstream and downstream challenges, creating a more equitable and efficient ecosystem for all stakeholders.

    Our investment in Kita reflects a broader thesis on the convergence of supply chain modernization and financial service penetration in emerging markets. We believe that legacy industries in Southeast Asia, particularly agriculture, are poised for disruption at the intersection of logistics and fintech. The structural inefficiencies in these markets present not only challenges but also immense opportunities for value creation through scalable, tech-enabled solutions.

    Kita exemplifies this thesis. By embedding itself at the core of the agricultural supply chain, the company is not merely optimizing processes but redefining the industry’s foundational architecture. Its collaborative approach—partnering with government banks, HORECAs, and smallholder farmers—ensures alignment across stakeholders, amplifying its impact.

    Kita’s strategy is predicated on creating systemic, long-term improvements rather than incremental fixes. By addressing inefficiencies in transparency, logistics, credit access, and post-harvest infrastructure, the company is building the foundational layers necessary for a more resilient and equitable agricultural ecosystem.

    As venture investors, we are committed to supporting transformative businesses that align with our conviction in market-shaping innovation. Kita’s vision and execution make it a paradigm-shifting force in Philippine agriculture and a model for driving sustainable change across Southeast Asia’s legacy industries.