Medilytix Bureau:

Nine months after its inception, quick commerce start-up Zepto is inching towards entering the unicorn club. Zepto has raised a $200 million funding at a $900 million valuation led by Y Combinator Continuity along with a new investor, Kaiser Permanente.

Various existing investors, including Nexus Venture Partners, Glade Brook Capital and Lachy Groom, have also invested into this Series D funding round. The fresh fund has been raised nearly three months after Zepto raised $100 million in a Series C round at a $570 million valuation led by Y Combinator Continuity.

Aadit Palicha, Zepto’s co-founder and CEO, told Business Today in an exclusive interaction that the investors doubling down on the young start-up is a testament to the fact that the company’s core business model is strong, where VCs see a growth value.

“During the last quarter we posted 800 per cent quarter on quarter (QoQ) revenue growth, while burn has come down 5X on a per-order basis. Our team achieved this while continuing to delight our customers – we maintained a phenomenal 88-Point NPS and 60 per cent Month-1 Buyer Retention at scale. This unbelievable execution over the past few months has made it clear to investors that Zepto will be one of the winners in Indian Q-Commerce,” the 19-year-old Palicha said.

The fresh capital, as per Zepto’s CEO, would be utilised in expanding the services beyond the metros, and Tier 1 towns. “We are really focused on gaining foothold in the top 30 cities of India when it comes to 10-minute delivery,” Palicha said. He added that the company is also looking to use the funds for consolidating its product development and hire more people across various teams.

Zepto was co-founded by Palicha and his childhood friend, Kaivalya Vohra in August 2021 after they dropped out of a computer science programme in Stanford University and disrupted the e-commerce industry of India by bringing in the concept of 10-minute grocery deliveries at a time when the country was under a strict lockdown. In a matter of few months, Zepto hit over $200 million valuation by bagging $60 million from a clutch of investors.

The cumulative capital raise by the young start-up now stands at $360 million within a period of nine months. Zepto is also likely to be the second youngest start-up to enter the India’s unicorn club after Mensa Brands, a Thrasio style e-commerce brands aggregator.

The company says that it has now built a team of over 1,000 people in a few months and will continue to hire across all functions, including engineering, analytics, operations, marketing, finance, and HR.

“Our rigorous focus on unit economics is the main reason why we’ve had such an amazing trajectory as a company. We’ve turned micro-markets profitable and brought down burn significantly while growing to a scale of hundreds of thousands of orders per day,” co-founder and CTO, Kaivalya said in a statement.

Zepto is also piloting a service to deliver coffee, chai, and other café items within 10 minutes across select areas in Mumbai. The new category, termed ‘Zepto Café,’ is being received quite well by early customers and if the pilot continues to go well, Zepto plans to scale this service across India soon, the company said in a statement.

Leave a Reply

Your email address will not be published. Required fields are marked *