Pinduoduo, China’s largest agriculture platform, is stepping up its spending on research and development (R&D) as it invests in a future of smart and sustainable agriculture.
Under Chairman and Chief Executive Officer Chen Lei, a computer scientist by training, the six-year-old company reported record R&D spending in the third quarter ended September, rising 34% to 2.4 billion yuan. That’s the highest level of R&D expenses since its IPO in 2018. At the same time, sales and marketing spending declined for a third-straight quarter.
“We are placing more focus on investments in R&D, away from the emphasis on sales and marketing in our first five years,” Chen said on a conference call following the results announcement. “We want to leverage our strength in technology to deepen our digital inclusion efforts in agriculture.”
Pinduoduo’s roots in agriculture – it started in 2015 selling fruits – has placed it in a unique position to capture opportunities in making farming more productive and environmentally sustainable. The company can count on its 16 million farmers and over 860 million consumers to push innovation on both the demand and supply sides. Last year, the platform handled more than $40 billion worth of agriculture-related orders.
Pinduoduo has also spearheaded the creation of an annual precision agriculture competition that has come to be a leading showcase for young agricultural scientists and practical cost-effective technology solutions for smallholder farmers. The company has partnered with Wageningen University & Research of the Netherlands for the Smart Agriculture Competition, with the latter’s world-leading experts sharing their knowledge with participants in a series of exclusive seminars.
Co-organizers China Agricultural University and Zhejiang University, as well as the UN’s Food and Agriculture Organization and Wageningen University and Research have also lent their respective expertise and support to the competition. Bayer Crop Science, a global pioneer in digital farming and precision agriculture, and Ridder Group, a leader in greenhouse technology, are among the companies that have signed on to support the competition’s aims to promote agricultural innovation.
“Technology is transforming agriculture and food production. It is extremely important to implement the digital transformation of agriculture and food safety,” said Carlos Watson, FAO’s representative to China, during the opening of this year’s Smart Agriculture Competition. “We are really looking forward to another successful collaboration to bring farmers real benefits through digitalization.”
Pinduoduo has also been innovating to ensure that agricultural produce reaches its consumers faster and fresher by re-engineering logistics processes through the application of smart routing and cold-chain optimization.