Instacart Co-Founder Apoorva Mehta To Leave Board
Apoorva Mehta - photo on his X account
September 19, 2023
Instacart listed on the Nasdaq stock exchange today at a valuation of $10 billion. “There is much to celebrate today @instacart,” co-founder Apoorva Mehta stated on X, formerly Twitter, where he has 23,000 followers. He came upon the idea of Instacart in 2012, while living as a 24-year-old in the San Francisco Bay area, when he did not have a car to buy and transport groceries to his empty fridge.
San Francisco based Instacart partners with more than 1,400 national, regional, and local retailers to facilitate online shopping, delivery, and pickup services from more than 80,000 stores, including Costco and Kroger, in the United States and Canada. The company hires about 600,000 freelancers who pick, pack, and deliver orders to customer homes.
In 2021, Instacart had a valuation of $39 billion, during the last of its 19 funding rounds. At that time, amidst the COVID-19 pandemic lockdown, Instacart and other delivery firms saw booming demand. The last funding round attracted major venture capital firms including Sequoia and Andreesen Horowitz, who each invested $50 million at the peak valuation, in addition to their earlier investments, according to CNBC.
"The Instacart team unlocked one of the most operationally complex industries and brought it online to the benefit of the entire grocery ecosystem,” Jeff Jordan, Managing Partner at Andreessen Horowitz said in a statement about the funding. "We believe this is just the beginning for online grocery and Instacart is well-positioned to continue to lead in this emerging space."
“Instacart, which has delivered groceries and goods for millions of customers across North America, is the category leader and fulfilling its role as a vital service for consumers, a reliable partner for retailers and an effective platform for advertisers." Michael Moritz, Partner at Sequoia Capital said in the same statement.
Instacart’s public offering today, which was led by Goldman Sachs and J.P. Morgan, valued the company 75% below the $39 billion peak valuation of two years ago. Competitor DoorDash too has lost value, dropping to $30 billion, down 62% from its 2021 peak.
This is because, following the end of the pandemic lockdown, demand for home delivery services has declined. Also, Instacart faces strong competition from DoorDash and several other delivery services as well as ride service Uber. And the big retailers Amazon, Walmart and Target have their own delivery services.
The decline in Instacart’s valuation is a hit to venture capital firms Sequoia and Andreesen Horowitz, according to CNBC.
In 2021, Fidji Simo replaced Mehta as Chief Executive Officer of Instacart. Earlier, she was the Head of the Facebook app at Meta Platforms, which reaches billions of people every month. Simo oversaw the development and strategy for the Facebook app, including News Feed, Stories, Groups, Video, Marketplace, Gaming, News, Dating, Ads and more. She was also a core driver of Facebook’s mobile monetization strategy and led the team in charge of architecting Facebook’s advertising business and developing ad formats for mobile. She also made video a critical part of the Facebook experience, from rolling out videos that autoplay in News Feed, to building and launching Facebook Live and Watch.
Prior to Facebook, she joined eBay in 2007 as part of the company’s Strategy team. Simo, 37-years-old, holds a Master of Management from HEC Paris.
Asha Sharma is the Chief Operating Officer at Instacart, overseeing product, design, research, partnerships, analytics, marketing, operations and customer experience. Like Simo, she joined Instacart from Meta Platforms, where she was Vice President of Product for many private communications products across Facebook, Messenger, and Instagram. Earlier at Meta, she served as Head of Product for Social Impact. Before Meta, Sharma was the Chief Operating Officer of Porch Group and earlier worked in marketing and operations at Microsoft.
Sharma, 34-years-old, earned a Bachelor of Science in Business from the University of Minnesota, Carlson School of Management. In 2022, Sharma earned $813,000 in salary and bonus at Instacart. She owns stock in the company worth $14 million.
Co-founder Apoorva Mehta’s ownership of Instacart is valued at $870 million at the offering price. He was Chief Executive Officer from 2012 to 2021. Since 2012, he served as Chairperson of the company’s board of directors. Mehta, 37-years-old, resigned from the board, including as Chairperson, following the public listing.
Since 2022, he has served as founder and Chief Executive Officer of Cloud Health Systems, a digital healthcare startup. Earlier, from 2008 to 2010, Mehta served as a supply chain engineer for Amazon. He holds a B.S. in Electrical Engineering from the University of Waterloo, Canada.
Mehta failed at 20 businesses, including building a social network for lawyers, within two years after leaving a job at Amazon in 2010 and co-founding Instacart in 2012.
He told Entrepreneur.com, "The reason to start a company is to bring a change that you strongly believe in to this world."
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