Mumbai-based grocery delivery startup Zepto raised US$ 60 million at a post-money valuation of US$ 225 million, backed by prominent angel investors led by Glade Brook Capital, Y Combinator, Nexus Venture Partners and WhatsApp former Chief Business Officer Neeraj Arora.
Quick e-commerce is poised to transform how many shop around the world. Zepto has emerged as a leader in India, with exponential growth and best-in-class execution.”~ Paul Hudson, Chief Investment Officer, Glade Brook Capital
The startup – instituted in September 2020 and operational since April 2021 – entered the quick commerce latitude with a competitive edge of 10-minute delivery and aims at a larger ground coverage, even with bigger names like Swiggy, Zomato and BigBasket already at play.
Express delivery in terms of groceries has made a gigantic leap in the post-pandemic economy and ‘dark stores’ are a key aspect of the whole idea of doorstep grocery delivery within 45 minutes. Dark Stores are smaller warehouses that make a dense network in a city, to aid companies achieve the shortest possible delivery time. The operational efficacy of such dark stores ends up being directly related to the delivery efficiency.
Zepto has a network of self-owned cloud stores or micro-warehouses which help in achieving the target delivery time. It plans to leverage the newly acquired equity to proliferate the market by increasing its micro-warehouses and manpower to facilitate increased operations throughout the supply chain. While the startup operates in Mumbai, Delhi NCR and Bangalore, a major expansion in Hyderabad, Chennai, Pune and Kolkata is expected over the next 30 days. The bigger picture includes servicing about 100 pin codes by the end of this year.
Nobody has really perfected commerce in India, comprehensively. If you look at some of the older companies that are trying to execute on this model, a lot of them are terribly unfocused, they just don’t have the discipline of execution on operating one model. They get into multiple different things, which is sort of the biggest downfall for any large company.”~ Aadit Palicha, Co-Founder, Zepto
Palicha also said that along with a stable median delivery time of 8 minutes, the company has been seeing a 200% month-to-month increase in revenue, but did not reveal the exact numbers.
Research firm RedSeer published a report that valued quick commerce at US$ 300 million by end of this year and at US$ 5 billion by 2025. It also mentioned that quick commerce addressed about 20 million households and occupied a US$ 50 billion market size in India (in 2020).