The Silicon Valley – and Canadian-founded – tech darling raised another US$100 million last week, adding to the US$225 million it attracted from private investors in June.<\/p>\n
That gives Instacart a valuation of US$13.8 billion. Not bad for a company that University of Waterloo graduate Apoorva Mehta founded in 2012 when he decided his former employer, Amazon, couldn’t figure out the fresh food business. <\/p>\n
Mehta once called grocery delivery \u201cthe largest market in plain sight.” Delivery services had been around since the 1800s but failed to transform in the Internet age because they didn’t put the customer first. Instead, they expected people to wait for refrigerated trucks that operated on a company’s schedule. A bit like the cable guy.<\/p>\n
Mobile apps and the gig economy changed that, allowing intermediaries like Instacart to access different suppliers and hire freelance \u201cshoppers” to get groceries to you on your schedule. <\/p>\n
COVID-19 turned the model into a rocket ship. In the U.S., Instacart’s share of the online grocery market spiked to 55% in the third week of May, up from 30% in February, and customer order volume has been up by as much as 500% year-over-year.<\/p>\n
But that doesn’t spell the end of grocery stores.<\/p>\n
\u201cCustomers love their local grocery stores, and that connection has been built over generations,” Instacart President Nilam Ganenthiran (also a Canadian) says on a new episode of the RBC Disruptors podcast.<\/p>\n