Instacart chief executive officer Apoorva Mehta wants every household in the United States to use Instacart, a grocery delivery service that allows shoppers to order from more than 300 retailers, including Kroger, Costco, Walmart and Sams Club, using its mobile app.Today, the company is taking a big leap toward that goal.San Francisco-based Instacart has raised $600 million at a $7.6 billion valuation, just six months after it brought in a $150 million round androughly eightmonths after a $200 million financing that valued the business at $4.2 billion.D1 Capital Partners, a relatively new fund led by Daniel Sundheim, the former chief investment officer of Viking Global Investors, led the round.Instacart is raking in cash aggressively but spending it cautiously.
The company still has all of its Series E, which ultimately totaled $350 million, and the majority of its $413 million Series Din the bank, a source close to the company told TechCrunch.
That means, in total, Instacart has $1.2 billion at its fingertips.
Currently, according to the same source, the company is only profitable on acontribution margin basis, meaning its earning a profit on each individual Instacart order.In a conversation with TechCrunch, Mehta said the company didnt need the capital and that itwas an opportunistic round, i.e.
the capital was readily available and Instacart has ambitious plans to scale, so why not fundraise.
Instacart plans to use the enormous pool of capital to double its engineering team by 2019, which will include filling 300 open engineering roles in its recently announced Toronto office, he said.As far as an initial public offering, it will happen eventually.It will be on the horizon, Mehta told TechCrunch.2018 has been a really big year for us, he added.
Thereason why we are so excited is because the opportunity ahead of us is enormous.The United States is a $1 trillion grocery market and less than 5 percent of that is bought online.
Its an enormous category thats highly under-penetrated.In the last six months, Instacart has announced a few notable accomplishments.As of August, the service has been available to 70 percent of United States households.
Thats due to the expansion of existingpartnerships and new deals entirely, like a recently announced pilot program between Instacart and Walmart Canada thatgives Canadian Instacart users access to 17 different Walmart locations across Winnipeg and Toronto, Ontario.The company has also completed several executive hires.
Most recently, it tapped former Thumbtack chief technology officer Mark Schaaf as CTO.
Before that, Instacart brought onDavid Hahn as chief product officerandDani Dudeckas its first chief communications officer.In early September, the company confirmed its chief growth officer Elliot Shmukler would be leaving the company.The six-year-old Y Combinator graduate has raised more than $1.6 billion in venture capital funding from Coatue Management, Thrive Capital, Canaan Partners, Andreessen Horowitz and several others.