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Instacart IPO: Everything you need to know

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Axi Team
Everything you need to know Instacart IPO

Instacart´s IPO seems to be getting closer and could even happen in 2023. The company has been publishing stellar financials recently, fuelling speculations about an upcoming IPO.

Instacart already filed its paperwork to the SEC in 2022 but decided to put its IPO plans temporarily on hold and wait for better market conditions.

The good news is that Instacart should be well prepared once it is ready to pull the trigger on the IPO.

 

Instacart company stats

Founded 2012
Headquarters San Francisco, California, United States
Number of employees 3,000
Revenue 2021 $1.8 billion
Stock Exchange -
Potential Valuation $10 billion

Source: Bloomberg

 

What is Instacart?

Instacart is a US-based company that specializes in grocery delivery and pick-up services. It operates in the United States and Canada and has more than 3000 employees. Its headquarters is located in San Francisco.

Instacart rose to fame for its grocery delivery service, but it sells a variety of products ranging from electronics to clothing and toys.

The company has partnered with over 900 retail partners across tens of thousands of store locations - including some big players such as ALDI, Kroger, Costco, and many smaller retailers.

How does Instacart work?

Once you place an order, a personal shopper will pick up your groceries and deliver them to your preferred location. Similar to Uber and Deliveroo, personal shoppers are not full-time employees but independent contractors who are paid for each delivery.

Instacart doesn´t sell any groceries directly, which is why their personal shopper will notify the customer if an order is not available.

How does Instacart make money?

Instacart receives a commission for each product that is sold through their platform - meaning the retailer who sold it has to pay a percentage of the price to Instacart.

The company also charges a service and delivery fee for each order fulfilled. Delivery fees start from $3.99, while service fees will be 5 percent of the order´s subtotal.

Instacart also operates a subscription model called Instacart Express. For a $9.99 monthly or $99 annual fee, customers get unlimited free deliveries.

Furthermore, the company also sells in-app advertising space.

 

The IPO: When, where and what to expect

Instacart has recently cut its internal valuation to $10 billion. This is almost 75% lower than its early 2021 valuation of $39 billion.

Despite the challenging environment, Instacart has performed extremely well. Its FY2022 revenues increased by 39% while gross transaction volumes rose by 16%.

Instacart has profited from its push into advertising, which is paying off. Considering the company´s impressive growth and diversification, investor interest is likely to bounce back quickly once market sentiment has stabilized.

Instacart announced on September 11th, 2023, that it would offer 22 million shares at a price range of $26-28 per share. This would give the company a valuation of $7.17 to $7.73 billion, a number that could go up to $9.3 billion if all stock options and other rights are exercised. The company is expected to go public later this month.

 

3 steps to trade Instacart IPO with Axi

An Initial Public Offering (IPO) is an investor’s first chance to gain exposure to an organisation. An IPO is an important milestone for a company looking to raise capital and an opportunity for investors to get involved in a hopefully growing business.

With Axi you can get exposure to Instacart IPO as soon as it’s listed on a specific exchange and prices from the exchange become available to our liquidity providers.

  1. Login to your live MT4 trading account (sign up with Axi if you don’t have one)
  2. Navigate to market watch, right-click, and select ‘show all’. Search for Instacart.
  3. Choose your position and size and go long or short on share prices. Don’t forget to set risk management tools like a stop loss and take profit order.

 

Sources: Bloomberg

 

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The data is sourced from third-party providers. This information is not to be construed as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product, or instrument; or to participate in any trading strategy. It has been prepared without taking your objectives, financial situation, or needs into account. Any references to past performance and forecasts are not reliable indicators of future results. Axi makes no representation and assumes no liability regarding the accuracy and completeness of the content in this publication. Readers should seek their own advice.



Axi Team

Axi Team

The Axi team is full of people with decades of financial industry experience and knowledge of almost every aspect of trading. The Axi team blog, in addition to regular posts from our daily market analysis contributors, is a place to share wider insights and ideas. In this section, you’ll find posts about everything from forex education and helpful hints for new traders to product updates and important market announcements.


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