India grocery delivery start-up Zepto gets $200m
Zepto, an Indian grocery app that claims it can deliver food in 10 minutes, has raised a USD 200m round led by Y Combinator at a valuation of USD 900m.
It follows a USD 100m investment in December that valued the company at USD 570m and a USD 60m round in October at a valuation of USD 200m. Y Combinator, Glade Brook Capital, and Nexus Venture Partners took part in all three rounds. Total funding since inception in April 2021 is USD 360m.
Zepto was set up by Stanford University dropouts Aadit Palicha and Kaivalya Vohra, who assembled a team including former executives from Uber, Flipkart, Dream11, Pepperfry, and Pharmeasy. It currently operates in 11 cities and plans to use the latest funding to expand its dark store network across India.
The company’s closest competitors include BigBasket and Grofers, which have recently been estimated to have 37% and 13% market shares, respectively. BigBasket, which was acquired earlier this year by Tata Group's digital unit at a USD 2bn valuation, typically requires 2-3 days for delivery.
Zepto claims to have achieved quarter-on-quarter growth of 800% in recent months while reducing cash burn by 5x. Annualised revenue is USD 200-400m and it is on course to hit USD 1b in the first half of 2023, according to TechCrunch, which cited Palicha.
The latest round reportedly included participation from Contrary Capital, healthcare provider Kaiser Permanente, and US angel investor Lachy Groom. Previous backers include Breyer Capital, GFC Global Founders Capital, and India’s 2 a.m. Ventures.
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