Grocery delivery startup Instacart announced today that it has raised another $600 million in a new funding round led by D1 Capital Partners. According to Crunchbase, this brings the total amount of funding raised by Instacart to $1.6 billion (with a b).
This latest mega-funding round comes after Instacart had raised $150 million in April, which followed a $200 million round in February. But Instacart isn’t alone, as money has been poured into grocery delivery companies this year. Just during the back half of this summer, Postmates raised $300 million and DoorDash raised $250 million (which followed a $535 million raise back in April for the company).
Phew! With that much money, all these startups should be delivering groceries in warchests instead of reusable totes.
The online grocery space is expected to hit $100 billion by 2022, and all these startups are ramping up to grab your business now so you’ll spend more with them then. In its press announcement, Instacart said that it will be using this new money for “further expansion in North America, marketing investments to increase awareness of Instacart at our retail partners’ stores, and recruiting world-class engineering and product development talent.”
Instacart recently signed a deal to provide grocery delivery for 1,600 Kroger stores by the end of this month. Last year the company signed a deal to be in 1,800 Albertsons stores. But as I noted previously, while Instacart is expanding at a rapid clip, it’s not really innovating.
Kroger has been on an innovation tear this year, ramping up investments in Ocado to do robot-driven smart warehouses, and piloting tests of autonomous delivery vehicles. DoorDash is experimenting with robots. And Walmart is launching its own delivery service.
Hopefully we’ll see some innovation announcements come from Instacart in the near future. At the very least, ideally all this money means any bananas I order from them won’t arrive in a deep shade of unripe forest green.