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.
|Headquarters||San Francisco, California, United States|
|Number of employees||3,000|
|Revenue 2021||$1.8 billion|
|Potential Valuation||$10 billion|
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.
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.
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.
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.
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.
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