Grocery delivery firm Instacart hits $39b valuation

Instacart has announced a $265 million funding round, giving the US grocery delivery giant a valuation of $39 billion, making it one of most valuable startups worldwide.

The valuation represents a $21.3 billion increase compared to the at $17.7 billion achieved during Instacart’s last funding round in October, which raised $200 million.

Investors in the round included Andreessen Horowitz, Sequoia Capital, D1 Capital Partners, Fidelity Management & Research Co. and T. Rowe Price Associates Inc.
The company, founded in 2012, claimed it is available in more than 85 per cent of U.S. households and over 70 per cent of those in Canada and has partnered with over 45,000 stores.

Instacart is the most popular grocery delivery company in the U.S, and controls 46 per cent of market share as of last summer according to research from retail analyst Second Measure.

Instacart said it would use the cash injection to increase its corporate headcount, targeting a 50 per cent increase this year across business units.
The company has encountered a massive surge in demand during the pandemic but cut 1,900 jobs early this year, including its only union roles.

“Today’s fundraising reflects the strength of Instacart’s business, the growth our teams have delivered and the incredible opportunity ahead,” said Nick Giovanni, chief financial officer for Instacart. “This past year ushered in a new normal, changing the way people shop for groceries and goods.”

“While grocery is the world’s largest retail category with annual spend of $1.3 trillion in North America alone, it’s still in the early stages of its digital transformation.”

He added: “As online grocery penetration increases over the coming years, we’ll continue to invest in our people, products and partners to support all of the communities we serve.”

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