Zepto nabs $200 Million funding, reaches valuation of $900 Million

The quick commerce platform has witnessed nearly 60% growth in valuation from $570 million last year to $900 million post latest influx 

Mumbai-based instant grocery delivery startup, Zepto has secured $200 million in a fresh funding round led by YC Continuity Fund.

YC Continuity is an existing investor in Zepto, providing growth-stage funding under Silicon Valley’s renowned accelerator Y Combinator.

Thanks to the latest funding round, Zepto’s valuation has escalated to $900 million, showcasing an approximately 60% rise as compared to the earlier fundraiser last year that rendered the startup’s valuation at $570 million.

Reportedly, the latest round saw existing investors including Glade Brook Capital, Lachy Groom, and Nexus Venture Partners joined by a new investor, Kaiser Permanente.

The quick commerce platform, that offers grocery delivery service in 10 minutes is a part of a fiercely competitive environment consisting of well-capitalised rivals such as Reliance Industries-funded Dunzo, Swiggy, and Tata Digital’s BigBasket exploring the space with different delivery timings.

Last year, Swiggy’s Chief Executive Sriharsha Majety, announced that the food delivery platform has dedicated capital worth $700 million to ramp up its ultra-fast commerce initiative “Instamart”.

Post emergence of the Covid-19 pandemic, firms in the ultra-fast commerce landscape gained significant momentum. However, these firms are now scrutinized for their unit economics and high cash burn – which in some cases seems to have escalated as far as $10 million-$15 million per month.

Another competitor of Zepto, Blinkit – formerly known as Grofers – is in later stages of a major merger agreement with food delivery app Zomato to overcome the lack of external investments and new capital with the aim of sustaining amidst burgeoning competition.

With this, Blinkit is expected to value at around $750 million, relatively lower than the funds raised by the platform during its last round.

Meanwhile, Swiggy’s Instamart has also put a leash on its previously aggressive campaigns, promoting 15-minute deliveries.

Source Credit: https://economictimes.indiatimes.com/tech/funding/quick-commerce-firm-zepto-valued-at-900m-gets-200m/articleshow/91267634.cms