Zepto, a Mumbai-based instant grocery delivery app founded by two teenagers, has raised $100 million at a $750 million valuation, bringing its total capital raised to $160 million.
The latest funding round was led by Y Combinator’s Continuity Fund, with participation from Nexus, Global Founders Capital, Glade Brook, Contrary Capital, Breyer Capital, and Lachy Groom.
Co-founder and CEO Aadit Palicha said in an interview that the company’s latest funding comes 45 days after a previous capital raise of $60 million at a valuation of $225 million.
Zepto was started by Palicha and his childhood friend Kaivalya Vohra, both 19-year-old , who dropped out of the computer science program at Stanford University to return to India. Promising to deliver grocery and daily essentials within 10 minutes, Zepto started in Mumbai earlier this year and has since expanded to Bangalore, Delhi and four other cities.
Kaivalya Vohra said that the monthly buyer retention rate is 65% and they have established a network of micro warehouses, each with the capacity to place more than 2,500 orders per day.
“We are excited to double down and lead this round in Zepto (YC W21). Since Aadit and Kaivalya went through Y Combinator, we have observed that they’re exceptional founders who bring relentless focus and “Doordash-like” execution to the quick commerce model,” said Anu Hariharan, a partner at Y Combinator, in a statement.
“They originally launched with a different model, swiftly pivoted to quick commerce in August 2021 and are now adding 100,000 new customers every week, 60% of them women. Their attention to detail on the logistics experience is unparalleled and this has enabled them to scale to most major metros in just 5 months. Simply put, we’re confident Zepto will win in this space over the long-term.”
Zepto is currently competing against companies such as Flipkart, Amazon, Blinkit, Dunzo, and Swiggy. Walmart’s India-based e-commerce giant Flipkart raised $3.6 billion at a post-money valuation of $37.6 billion in July. Indian food delivery startup Swiggy raised $800 million in a new funding round at a $5 billion valuation in April.