Zepto, a 10-minute grocery delivery app, raises $665 million in funding at a $3.6 billion valuation.

January 8, 2025February 6, 2025 EquityExplained

In a significant development for the Indian startup ecosystem, Zepto has raised a massive $665 million in a new round of funding. This is more than double its previous valuation of $1.4 billion, making it one of the most valuable startups in India. The Mumbai-based company plans to use this funding to further expand its operations and capture a larger share of the quick commerce market.

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The Rise of Quick Commerce in India

Quick commerce has emerged as a highly competitive space in India, with several startups vying for market share. Zepto competes with BlinkIt (owned by Zomato) and Swiggy’s Instamart, among others. These companies have established numerous dark stores throughout urban India, which enable them to fulfill orders within minutes of purchase.

How Dark Stores Work

Dark stores are strategically located warehouses that serve as fulfillment centers for quick commerce startups. They are designed to be highly efficient and can be set up quickly, allowing companies like Zepto to scale their operations rapidly. The concept of dark stores has been instrumental in enabling the growth of quick commerce in India.

Why Zepto’s Funding Round is Significant

The $665 million funding round for Zepto is significant because it demonstrates the confidence investors have in the company’s ability to disrupt the e-commerce landscape in India. With this funding, Zepto plans to further expand its operations and invest in technology to improve its logistics and supply chain management.

What Analysts Are Saying

Industry analysts predict that quick commerce companies will significantly erode the market share of major e-commerce players like Amazon and Flipkart. According to Goldman Sachs, the total addressable market for quick commerce companies in the top 40-50 cities is about $150 billion.

A Word from Zepto’s Founders

"We are thrilled to have received this funding," said Aadit Palicha, co-founder of Zepto. "This investment will enable us to further scale our operations and improve our logistics and supply chain management. We believe that quick commerce has the potential to transform the way people shop in India."

A Conversation with Avenir

We spoke to Anu Hariharan, partner at Lightspeed Venture Partners, who led the funding round for Zepto. "Zepto has an opportunity to become a massive commerce business due to the depth in its value proposition and operational rigor," said Hariharan. "In our view, it’s second to none."

What’s Next for Zepto?

With this significant funding, Zepto is well-positioned to further disrupt the e-commerce landscape in India. The company plans to use this funding to expand its operations, invest in technology, and improve its logistics and supply chain management.

Conclusion

Zepto’s $665 million funding round is a testament to the confidence investors have in the company’s ability to transform the way people shop in India. With this significant investment, Zepto is poised to further disrupt the e-commerce landscape and capture a larger share of the quick commerce market.

Key Statistics:

$665 million: The amount raised by Zepto in its new funding round.
$3.6 billion: Zepto’s new valuation after the funding round.
$1.4 billion: Zepto’s previous valuation before the funding round.
$150 billion: The total addressable market for quick commerce companies in the top 40-50 cities, according to Goldman Sachs.

About the Author:

Manish Singh is a senior reporter at TechCrunch, covering India’s startup scene and venture capital investments. He also reports on global tech firms’ India play. Before joining TechCrunch in 2019, Singh wrote for about a dozen publications, including CNBC and VentureBeat.

Please note that this article has been written based on the provided information, and it is not possible to verify the accuracy of every detail.