Instacart Files IPO on Nasdaq

Instacart filed for its initial public offering (IPO) on Friday, as the grocery delivery leader aims to create a “truly omni-channel experience” across physical and online stores.

• The company will be listed on the Nasdaq exchange under the ticker symbol “CART.” The number of shares to be offered and the price range for the proposed offering have not yet been determined.
• On May 11, Instacart announced that it had confidentially filed a draft registration statement to go public with the U.S. Securities and Exchange Commission (SEC).
• The San Francisco-based grocery tech company has developed into a e-comm powerhouse, partnering with over 80,000 stores nationwide and generating $242 million in net income during the first six months of 2023, according to the filing. While continuing to fulfill customer orders at major retailers, it has expanded into ready-to-eat meals and sought promotional partnerships with content creators.
• One expanding source of revenue for the company has turned out to be advertising. A recent teardown in The Information noted that the company derives more than 30% of its revenue from digital ads – a high margin add on to its core business.
• However, increased competition from Walmart, Target, Amazon and other deeply resourced retailers has heightened the imperative.
• The most recent quarter is a contrast to 2022, when the company posted a $74 million net loss for the first six months, at one point slashing the company’s valuation by nearly half.
• “Entities affiliated” with Sequoia Capital and D1 Capital Partners (which holds of greater than 5% of outstanding capital stock), director nominee Ravi Gupta and board member Daniel Sundheim have expressed interest in buying up to approximately $400 million in common stock, according to the filing.