Quick commerce in India continues to rise, with Zepto becoming the fastest-growing startup in the segment. Zepto raised nearly $1 billion in the last two months, with $665 million in June for a valuation of $3.6 billion and $340 million this month for a valuation of $5 billion. According to sources, Zepto was planning to raise $400 million but reduced it by $60 million to avoid further equity dilution of the existing investors.
General Catalyst led the current round of funding, with Epiq Capital and Dragon Fund joining as new investors. Also, Zepto‘s existing investors, such as StepStone, Lightspeed, DST, and Contrary, increased their stake in the company.
The co-founder and CEO of the company, Aadit Palicha, explained the rationale behind the funding as twofold: “First, the opportunity to take on board a lead investor of Neeraj Arora’s caliber from General Catalyst was one we couldn’t pass on. Second, strengthening our balance sheet is a strategic move, particularly as the company continues to deliver robust growth and operating leverage.”
Also read, Zomato Board Likely To Sign Blinkit Deal Next Week
Why Investors are Bullish on India’s Quick Commerce Segment?
Quick commerce is currently soaring in India, with e-commerce giants like Flipkart and Amazon foraying into the 10-minute delivery segment. Further, the e-grocer giant Bigbasket also announced that 10 minutes was the default on its platform. Also, the investors are bullish after getting the report on the feasibility of the quick commerce business model. According to Zomato, its quick commerce business, Blinkit, outperformed its core food delivery segment in the first quarter of FY25 in terms of adjusted revenue and Gross Order Value (GOV) growth. The quick commerce vertical saw a quarter-on-quarter (QoQ) increase of over 22 percent in both GOV and revenue, while the food delivery business recorded growth of over 10 percent in both metrics.
