Instacart, the grocery delivery app developer backed by corporates Comcast, American Express and Amazon, secured $225m in funding yesterday at a $13.7bn valuation.
Venture capital firms DST Global and General Catalyst co-led the round, which included investment firm D1 Capital Partners. The cash was raised at a valuation almost double that of Instacart’s last round in late 2018, and the company’s total funding stands at about $2.1bn.
The increased valuation is mainly due to the large uptick in the use of Instacart’s grocery delivery service, which collects items on behalf of customers and delivers the products to them, during Covid-19 lockdowns in the United States and Canada.
The company’s network of ‘shoppers’ now stands at more than 500,000 and it works with some 400 retailers covering 30,000 stores. It has also expanded from basic groceries and household goods to prescription medication and alcohol.
Instacart plans to direct the funding to its staff, having increased the size of its care team from 1,200 to 3,000 in April this year following a strike from its shoppers over a lack of protective equipment or hazard pay. It will also invest further in technology and look to launch new strategic initiatives.
D1 Capital Partners led the $600m first tranche of Instacart’s series F round, which closed at $871m in November 2018 with backing from Tiger Global Management, Coatue Management and Valiant Capital at a $7bn pre-money valuation.
The first corporate investment for Instacart came in a $44m series B round in 2014 featuring American Express Ventures, a subsidiary of payment services firm American Express, as well as Andreessen Horowitz, Canaan Partners, Khosla Ventures, Sequoia Capital, Sam Altman and Aaron Levie.
The series B valued the company at $400m and won GCV’s sub-$50m investment of the year. It preceded a $220m series C in 2015 featuring mass media group Comcast’s corporate venturing unit, Comcast Ventures, that bumped up Instacart’s valuation to $2bn.
Kleiner Perkins Caufield & Byers (KPCB) led the 2015 round, which included Valiant Capital, Andreessen Horowitz, Khosla Ventures, Sequoia Capital, Dragoneer Investment Group, Thrive Capital, Levie and Altman.
Whole Foods, the grocery chain since acquired by e-commerce firm Amazon, invested $36m in Instacart in 2016 before it added $400m from Sequoia Capital, Andreessen Horowitz, Khosla Ventures, KPCB, Initialized Capital, Thrive Capital, Valiant Capital, FundersClub, Wellcome Trust and Y Combinator Continuity the year after.
The company subsequently completed a $350m series E round in April 2018 that included Coatue Management and Glade Brook Capital Partners, valuing it at $4.4bn post-money.
