Instacart, the US-based grocery delivery service backed by e-commerce firm Amazon, payment services provider American Express and mass media group Comcast, secured $600m in funding yesterday at a $7.6bn valuation.
Hedge fund D1 Capital Partners led the round, with the other participants not disclosed. The valuation represents an increase of about 75% from April this year, when Instacart closed a $350m series E round featuring Coatue Management and Glade Brook Capital Partners that valued it at $4.35bn.
Instacart runs an online service that allows users to order goods from local stores that are then delivered to them, with a small fee attached, in as little as an hour. It has partnerships with more than 15,000 grocery stores including several large chains, such as Aldi, CostCo and Walmart Canada.
The service covers about 70% of US households and 50% in Canada, and Instacart will use the funding to expand its reach in North America while growing its product development and engineering teams.
Apoorva Mehta, founder and chief executive of Instacart, said: “The US is nearly a $1 trillion grocery market, and last year we saw almost every major grocer in North America bring their delivery business online in a significant way.
“We believe we’re in the very early stages of a massive shift in the way people buy groceries and we expect that one in five Americans will be shopping for their groceries online in the next five years.”
Instacart has now raised more than $1.6bn since it was founded in 2012, including $44m in a 2014 series B round featuring Amex subsidiary American Express Ventures, Sequoia Capital, Canaan Partners, Khosla Ventures, Andreessen Horowitz and various private investors, at a $400m valuation.
The company secured $220m at a $2bn valuation in a 2015 series C round led by Kleiner Perkins Caufield & Byers (KPCB) that included Comcast unit Comcast Ventures, Sequoia, Khosla, Andreessen Horowitz, Dragoneer Investment Group, Thrive Capital and Valiant Capital.
Whole Foods, the retailer since acquired by Amazon, invested $36m in Instacart in 2016, before Khosla Ventures, KPCB, Thrive Capital, Valiant Capital, Initialized Capital, Wellcome Trust, Y Combinator Continuity and FundersClub added $400m in a March 2017 round that valued it at $3.4bn.
Image courtesy of Instacart.
