Grocery delivery startup Instacart will start 2015 with a bundle of money in the bank. The startup, which is an app that enables consumers to order groceries from multiple stores via one web site and get them delivered that day, has raised nearly $210 million in fresh capital according to a regulatory filing this week. The funding round follows one in June that raised $44 million.
That previous Series B round was led by venture capital firm Andreessen Horowitz and included existing investors Sequoia Capital, Khosla Ventures and Canaan Partners. Neither the new U.S. Securities and Exchange Commission filing nor an Instacart spokeswoman would say who participated in the latest funding round. Requests for comment to previous investors and firms rumored to be part of this new round were not immediately answered. Instacart “will release more detail in the coming weeks,” the spokeswoman says.
The filing with the Securities and Exchange Commission says that 17 investors have already participated in the funding round. The new investment round would reportedly value Instacart at $2 billion.
The filing indicates that San-Francisco-based Instacart could raise an additional $10 million in new capital, bringing the total for this newest round to $220 million. The filing gives no suggestion about what Instacart plans to do with the new money. For the previous round, Instacart founder Apoorva Mehta said the company will use the funds to expand into new regions, to improve customer service and to experiment with new delivery models.
Today the web accounts for 1% of grocery sales in the United States, that rate grows to 3% in France, 4% in South Korea and 5% in the United Kingdom, according to a study earlier this year from Boston Consulting Group. But Instacart is trying to grow and gain more of that share. In September, for instance, upscale grocer Whole Foods Market and Instacart boosted the number of cities where Whole Foods Market customers can receive same-day or even one-hour delivery of their online orders.
Instacart also faces more competition. Amazon.com Inc., for example, already offers same-day delivery to at least 17% of the U.S. population and has launched one-hour and two-hour deliveries of e-commerce orders to consumers in Manhattan, the first phase of a new program called Prime Now. In October, the U.S. Postal Service won approval to expand a test of delivery groceries to online shoppers; the Postal Service has been testing early-morning grocery deliveries in recent months with Amazon.com Inc., No. 1 in the 2014 Internet Retailer Top 500.
For more about what Amazon might do in 2015, check out the January cover story of Internet Retailer magazine.