Instacart (www.Instacart.com), the grocery delivery service whose personal shoppers hand pick and deliver items from trusted local stores, announced that it has closed a $220M round of Series C financing led by Kleiner Perkins Caufield & Byers (KPCB). Other participants in the round include Comcast Ventures, Dragoneer Investment Group, Thrive Capital, Valiant Capital and previous investors Andreessen Horowitz, Khosla Ventures and Sequoia. This brings Instacart’s total funding to date to approximately $275M.
“We look for visionary entrepreneurs who are re-imagining big business opportunities – in Instacart, we found both,” said Mary Meeker, general partner at KPCB, who will be a board observer for Instacart. “Many Americans spend hours per week grocery shopping. Combining its elegant app with on-demand delivery, Instacart allows consumers to save time – and discover new products – while shopping from their favorite local stores.”
Instacart Founder and CEO Apoorva Mehta said that the company plans to apply the funds primarily toward category expansion, continued geographic growth and technology enhancements.
“Instacart’s offering really resonates with customers,” said Mehta, “We’ve got robust processes in place to support category and geographic expansion. Our vision is to help all types of local retailers get online and offer their customers one-hour delivery. This financing round will help us accelerate and scale those efforts.”
Instacart has disrupted the traditional grocery delivery space with its crowdsourced labor force dubbed personal shoppers who shop for and deliver orders using their own transportation in as little as one hour. This eliminates the need for costly infrastructure such as inventory, warehouses, trucks and full-time drivers. Rather than trying to disintermediate local stores as some delivery services have done, Instacart’s strategy is to partner with retailers to help them expand their geographic reach and overall revenue.
Over the past year, Instacart has achieved several significant milestones:
- The company’s revenue grew by more than 10 times in 2014, doubling in Q4 alone.
- Instacart signed partnership agreements with major retailers such as Whole Foods Market, Fairway Market and Fresh & Easy.
- The company signed business development agreements with HomeAway and Yummly.
- It more than doubled its full-time employee base, which now exceeds 100.
- The company now has more than 4,000 personal shoppers, independent contractors who shop for and deliver customer orders.
Michael Moritz, chairman of Sequoia and an Instacart board member, said, “Instacart has become the best friend of the U.S. supermarket industry - making it possible for them to have much closer ties and provide a bevy of new services to their customers. Instacart is helping supermarkets across the country take full advantage of the full power of broadband internet connectivity."
“Instacart’s smart use of technology has enabled it to soar in a category that’s been plagued by infrastructure issues for many years – they have a completely new way of enabling retail delivery,” said Jeff Jordan, Partner at Andreessen Horowitz and an Instacart board member. “We’re looking forward to working side-by-side with Apoorva and Instacart’s other investors to ensure that the company continues on its fast growth trajectory.”
