Instacart has cut its valuation to about $10 billion, a 20% drop from its valuation in October, and a nearly 75% drop from early last year when it was valued at $39 billion, according to reporting from The Information, which citied two persons familiar with the situation.
Last October, the company postponed its planned IPO because “the markets are still extremely tumultuous,” Instacart CEO Fidji Simo told employees via email. Instacart has raised over $2.5 billion from investors including Andreessen Horowitz and Sequoia Capital and spent much of last year meeting with more than 50 potential investors ahead of the highly anticipated IPO, The Information reports.
Instacart spokeswoman Lyndsey Grubbs declined comment on the report.
The San Francisco-based company has over 3,000 corporate employees and Grubbs said there have been no company-wide layoffs. Instacart competitor DoorDash Inc., meanwhile, announced in November that it was reducing its workforce by about 1,250 persons after occurring net losses each year since its founding.
While Instacart’s activity grew rapidly in the initial stages of the pandemic, sales slowed as the pandemic ebbed and more supermarkets and third parties began offering grocery delivery services.
Instacart said in 2020 that its customer demand increased by 300% year over year while the company expanded its shopper base to 350,000 from 200,000.
Despite the financial troubles, Instacart has been continuing to enhance its programs and services. In 2022, the company launched the Instacart Platform, a suite of enterprise-grade tools that is designed to enable more retailers to use the same technology behind Instacart’s consumer marketplace to power their own websites, apps, and retail operations.
Late last year, Instacart also began offering discounted memberships to participants in the Supplemental Nutrition Assistance Program (SNAP) program and added functionality that makes it easier for consumers to shop for flexible spending account (FSA) and health savings account (HSA) eligible items.