## Mumbai-Based Quick Commerce Unicorn Zepto Aims to Raise $400 Million## Mumbai-Based Quick Commerce Unicorn Zepto Aims to Raise $400 Million Mumbai-based Zepto, a pioneer in the quick commerce industry, is in discussions to secure an additional $400 million in funding. This latest round of financing would value the company at an impressive $5 billion, according to a report by The Information. Just days before this announcement, Zepto raised $665 million at a valuation of $3.6 billion. The recent funding round was led by Glade Brook, Nexus, and StepStone Group, with participation from major investors such as Avenir, Lightspeed, Avra, Goodwater, Lachy Groom, and Contrary. DST Global, an early backer of Swiggy, also joined the round. Zepto’s Market Presence Founded in 2021, Zepto operates in the fiercely competitive quick commerce market, catering to urban Indian consumers by delivering groceries, home goods, and electronics accessories in minutes. They employ a network of ‘dark stores,’ small warehouses strategically located near areas with high demand. This model enables Zepto to guarantee rapid delivery times. Zepto boasts over 50,000 delivery partners, adding 5,000 new partners monthly. The company plans to expand its dark store network to 700 by March 2025. It currently operates 350 dark stores in ten cities across India. Projected Growth and Valuation According to the report, Zepto anticipates reaching an annualized gross merchandise value (GMV) of $1.5 billion next month, generating $300 million in annualized gross profit. This valuation is higher than the $1.1 billion in annualized GMV reported in March, which served as the foundation for the previous funding round’s valuation. Zepto also draws parallels between its valuation and the rapid growth of Zomato, the parent company of quick commerce platform Blinkit. Blinkit, the market leader, has recently been valued at $13 billion, eclipsing Zomato’s market capitalization of $21 billion. Funding for Expansion The latest funding round will enable Zepto to further expand its dark store network and delivery partner capacity. This investment will also support the company’s goal of becoming a dominant player in India’s quick commerce sector.
Mumbai-based quick commerce unicorn Zepto is reportedly in talks to raise another $400 million at a post-money valuation of $5 billion, according to a report by the American publication The Information.
Just five days earlier, the startup raised a whopping $665 million at a post-money valuation of $3.6 billion.
Glade Brook, Nexus and StepStone Group jointly led the round. Other major investors include Avenir, Lightspeed, Avra (a new fund from Anu Hariharan), Goodwater, Lachy Groom and Contrary. DST Global, an early backer of Swiggy, another major player in high-speed trading, also participated in the round.
Zepto’s presence in the market
Founded in 2021 by Stanford dropouts Kaivalya Vohra and Aadit Palicha, Zepto operates in the highly competitive quick commerce market, delivering groceries, home goods and electronic accessories to urban Indian consumers in minutes.
The startup uses a network of ‘dark stores’: small warehouses near areas of high demand. This allows the three-year-old startup to guarantee fast delivery times.
It currently has over 50,000 delivery partners, adding about 5,000 new partners every month, and plans to expand its dark store network to 700 by March 2025.
Currently, Zepto has around 350 dark stores across 10 cities including Bengaluru, Chennai, Delhi, Ghaziabad, Gurgaon, Hyderabad, Kolkata, Mumbai, Noida and Pune.
It currently has over 50,000 delivery partners, adding about 5,000 new partners every month, and plans to expand its dark store network to 700 by March 2025.
On the other hand, Blinkit also aims to expand its network of dark stores from 526 by March 2024 to 1,000 by March 2025. Swiggy has 487 dark stores.
Expect to reach $1.5 billion in GMV
According to the report, Zepto expects to reach $1.5 billion in annualized gross merchandise value (GMV) next month and generates $300 million in annualized gross profit. This is higher than the $1.1 billion in annualized GMV reported in March, which formed the basis for the latest round’s valuation.
Zepto also compares its valuation to the rapid market capitalization growth of Zomato, owner of fast trading platform Blinkit.
In April, Goldman Sachs valued Blinkit at $13 billion, out of Zomato’s market cap of $21 billion. Blinkit is the largest player in this space, followed by Swiggy-owned Instamart, with Zepto in third place.
Earlier this month, it was reported that Zomato is injecting Rs 300 crore into Blinkit.
