A long-awaited delivery
Instacart is — finally — gearing up to make its debut on the public market, with the grocery delivery company targeting a valuation range of $8.6bn to $9.3bn, a significant discount from its lofty $39bn price tag in March 2021.
Instacart’s impending IPO, along with listings for chip-designer Arm and marketing firm Klaviyo, is poised to serve as a major litmus test for the US market after an almost two-year freeze-out that’s seen high-profile private tech companies like Stripe, Canva and Reddit, adopt a “wait and see” approach to timing their public market debuts.
Pixel-perfect produce
Apoorva Mehta, a former supply chain engineer at Amazon, tested nearly 20 different services before finding his niche with Instacart in 2012. The company initially took root in San Francisco, but grew quickly to other US cities, before expanding into Canada in 2017. Despite losing key investor support from Whole Foods in 2018 — which had been responsible for ~10% of Instacart’s sales — the company could rely on major partnerships with Costco and Kroger. By 2019, Instacart was shipping $5bn+ worth of groceries a year. Then Covid hit.
With lockdowns and restrictions, Instacart became a sensation, and daily app downloads skyrocketed an astonishing 218% in March 2020. That propelled Instacart to new heights, eventually reaching its peak valuation of $39bn, trailing only SpaceX as the most valuable US-based unicorn. However, as the era of social distancing began to wane, and VC funding began to dry up, Instacart’s $39bn valuation passed its use-by date.
