Instacart Raises Money and Experiences a Valuation Boost
Grocery delivery startup, Instacart has raised $200 million in fresh funding, boosting its valuation to a grand $4.2 billion and providing new resources for the startup to compete against Amazon.com Inc. This round of investment was led by Coatue Management, Glade Brook Capital Partners as well as it’s existing investors. Uptill now, Instacart has raised close to $900 million in total funding. Read more about Instacart here!
Instacart was valued at $3.4 billion last year. But this was before Amazon said it would acquire Whole Foods. Whole Foods has been one of Instacart’s largest and most important grocery store partners, as they signed a multi-year deal to be the exclusive delivery provider for most Whole Foods goods. Instacart is going to have to find new ways to outshine Amazon as it tries to drive into some of its biggest markets. Amazon, which has been exploring the grocery delivery market has been testing free two-hour delivery of Whole Foods groceries to Amazon Prime customers in certain U.S. cities.
CFO Ravi Gupta says Instacart won’t raise another round before going public and the Amazon-Whole Foods effect has given the start-up “tremendous momentum.” He also mentioned a 160% growth in Instacart‘s business in the last year from the previous one. As Amazon’s acquisition of Whole Foods threatens to disrupt the entire grocery industry, American grocers are increasingly looking for ways to boost their e-commerce offerings and are increasingly finding a delivery partner in Instacart. He says Amazon’s acquisition of Whole Foods “served as a catalyst for the entire industry to suggest that e-commerce is for real and everyone needs an e-commerce solution.” As a result, Instacart has become every grocer’s first call! Instacart could also work on expanding beyond areas where Amazon currently operates, something it can do with it’s seamless structure for acquiring new partners and then empowering them with a network of couriers and shoppers. Want to know how Instacart works? Read more.
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