Zepto has raised $200 million in a new funding round at a valuation of $1.4 billion. With this, Zepto has become the first unicorn of 2023 in India. This round was led by StepStone Group and Goodwater Capital, with participation from existing investors Nexus Venture Partners and GladeBrook Capital.
The funding will be used to expand Zepto’s operations across India and to develop new products and services. Zepto is seen as one of the few players in the market that has the potential to be successful.
Zepto business model was developed by a couple of successful instant grocery delivery startup founders. The company was founded by two teenagers Aadit Palecha and his childhood buddy Kaivalya Vohra who were both 19 at the time. The Zepto business model works within the quick commerce segment in India.
Both the Zepto founders were studying computer science at Stanford University and left the course to enter quick commerce in India. The Zepto business model promises to deliver your grocery in 10 minutes.
The company began its operations in Mumbai in 2021 and has since extended its operations.
The arrival of Zepto in India
Even the arrival of the startup in India was a bit serendipitous. Both Kaivalya Vohra and Aadit Palicha had returned to the country for a break just before the coronavirus pandemic engulfed India. Both these teenagers had partnered on several other projects earlier. They created a ride-hailing commute app suitable for school-going kids. But this time they found themselves locked in their homes when they arrived in Mumbai.
With the pandemic raging on mercilessly, both the teenagers were struggling to get their grocery supplies. This was even though grocery deliveries were categorized as essential by the government. They felt the need for having an online player for the grocery delivery sector in India. Despite being one of the largest markets in the world they were still grappling with some execution errors.
How Zepto works
Zepto has places called dark stores or micro fulfillment centers that lie in higher-demand neighborhoods. These dark stores use technology for performing tasks such as the placement of products. Some other tasks they perform include deciding the store locations, and mapping delivery routes for avoiding heavy traffic congestions. The company is already delivering items that include cooking necessities, fresh produce, personal care items, snacks and beverages, and home cleaning items.
One of the main things that went in the right direction for the startup was the talent acquisition department. They were able to attract several top-profile executives from Amazon Uber, Pharmeasy, Flipkart, and Dream 11 to join their organization.
The main thing that led to so many top executives deciding to join Zepto was that it allowed several people that moved to Bangalore to come back to Mumbai. However, the aggressive growth of the startup, its ambition, and its disciplined execution have led to several people that are similarly inclined to be attracted to the company.
Several other players are trying to participate in the market and trying to grow quickly. But they cannot promise things such as 10-minute delivery as consistently as Zepto. This period extends to 30, 40, and 45 minutes in most cases. Zepto is a detail-oriented and intense business with strong technical and operating discipline that allows them to pull off the 10-minute delivery.
Build your own app like Zepto
If you are looking to set up an on-demand business one of the best places to visit for a technology-based solution will be Jungleworks. With the powerful ordering, delivery, and growth suite, Jungleworks allows you to deliver faster to your customers. Visit the page for more information.
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