Within just five months of inception, quick grocery delivery app Zepto on Tuesday has raised $100 million in a Series C round led by Y Combinator's Continuity Fund at a valuation of $570 million.
The round also saw participation from new and existing investors, including Glade Brook, Nexus, Breyer Capital, Lachy Groom, Global Founders Capital and Contrary Capital.
The startup's newest funding comes 45 days after it had bagged a $60 million at $225 million valuation. Zepto, founded by 19-year-olds, Aadit Palicha and Kaivalya Vohra, has raised $160 million till date.
The company plans to expand coverage across multiple cities in India and scale its team rapidly and is currently hiring across all functions, including operations, supply chain, marketing, finance, product, engineering, and human resources, it said in a statement.
The firm which promises to deliver grocery and daily essentials in 10 minutes, started in Mumbai earlier this year and has since expanded to Bengaluru, Delhi and four other cities. Zepto claims its user-base is tripling every month.
"Today, our Month-on-Month Buyer retention is 65 percent with an 88-point Net Promoter Score (NPS). This data has given us the confidence to expand the 10-minute model across the country. In just 5 months, we’ve launched 100 micro-warehouses - each of which has the capacity to do 2,500+ orders/day - and we’re planning to launch at an even faster rate going forward," said co-founder and CTO, Kaivalya Vohra.
India's e-grocery market that is estimated to be worth $25 billion by 2025, according to a note from Sanford C. Bernstein. Zepto is competing against startups like SoftBank Group Corp.-backed Blinkit, Google-backed Dunzo and Naspers Ltd-backed Swiggy, as well as the likes of Amazon.com Inc and Walmart Inc-backed Flipkart.
While speaking to CNBC-TV18 about the highly competitive quick-commerce industry in India, Aadit Palicha, founder and CEO, Zepto said, "The biggest advantage we have is that – historically, fast-paced, up starch companies with high-quality teams that are exuding a very strong way – usually win in the startup ecosystem. Right now, we are seeing that. Our customer experience metric is through the roof, with an NPS at 98 percent. Its league is beyond what we have seen with other startups. When we look at the competitive market, the others seem to have reached an incumbent status and aren’t really able to execute the 10-minute delivery model successfully."
Zepto's leadership includes senior executives and operators from Flipkart, Uber, Dream11, Pharmeasy, PepperFry, and Amazon. The firm has 100 so-called dark stores, or micro-warehouses and now delivers over 2,500 items including fresh produce, cooking essentials, snacks and beverages, personal care items and home cleaning products.
(Edited by : Jomy Jos Pullokaran)
First Published: IST