Quick commerce startup Zepto, which delivers groceries and office supplies in ten minutes in a range of Indian cities, is reportedly in advanced talks to mop up fresh $100 million in investment. According to TechCrunch, this is reportedly the third capital raised by the company in just six months.
The committed funding is expected to come in from Indian family offices and high-net-worth individuals in the country. Asset management company Motilal Oswal will fill in the funding gap as it had earlier invested $40 million in Zepto. According to the report, Zepto had already received commitments that were above half of the total funding committed; however, the identities of these investors are not known as all said negotiations are privately set.
Zepto originates from Singapore and is moving its headquarters to Mumbai. According to reports, it may be relocating to Bengaluru, an Indian city recognized as the technology capital of India. This round of fundraising will likely be used to increase the domestic investor base in Zepto ahead of its scheduled IPO in 2025.
Avra, Lightspeed, Nexus, StepStone Group, YC Continuity, Glade Brook, and Contrary are some of the prominent backers of Zepto. It is well-positioned to boost its market presence as it battles with significant competition from giants in India’s quick commerce sector: BlinkIt, owned by Zomato; Instamart, Swiggy’s preferred e-commerce company backed by Prosus; and Tata’s BigBasket.
India’s E-commerce ecosystem in the making
India is now ranked third in the global startup ecosystem, according to broader indications. Recently, the Department for Promotion of Industry and Internal Trade (DPIIT) revealed statistics of 11 percent growth in incubators and accelerators. As reported, startups in India have secured $7.5 billion in venture capital funds between January and August 2024. “Strong investor confidence in a dynamic entrepreneurial ecosystem” will be the outcome.
Not only this, but S&P Global Market Intelligence has also stated that India’s nominal gross domestic product, or GDP, is expected to reach $7 trillion by the financial year 2030-31, thus making it the third-largest economy in the world by 2030. According to experts, India is an emerging ‘bright spot’ in the global economy that further elevates its startup ecosystem.
Zepto Flourishes Amid Unicorn Slowdown
Zepto became the country’s first unicorn in 2023, a notable feat since 2023, and has been described as the year of severe slowdown for unicorns in the country. The company co-founders Kaivalya Vohra and Aadit Palicha have also found a place in a league of their own as India’s youngest billionaires with net worths of Rs 3,600 crore and Rs 4,300 crore, according to the 2024 Hurun Rich List. Zepto has zoomed its way to near the top of LinkedIn’s list of Indian startups for 2024.
The Indian e-commerce market is expected to hit $12 billion in gross merchandise value between October and December 2024, up a whopping 23 percent from $9.7 billion a year ago, according to logistics unicorn Shiprocket. Zepto is perfectly positioned for this moment, with quick commerce demand growing across the nation.
