Just when it looked like Instacart could have gone the way of a Jackass shopping cart stunt (read: directly into a cement wall at high speeds), the company raised $200M in venture capital at a $4.2B valuation.
This is the on-demand grocery service’s first funding round since Amazon threw a wrench in their tiny little shopping cart spokes with the purchase of Whole Foods. Last week Amazon announced it will be offering 2-hour Whole Food’s deliveries via Prime directly competing for the hearts and gluten-free stomachs of Instacart’s asparagus water drinking, upper middle class, clientele.
Instacart will earmark its war chest to outflank Amazon. Using its existing infrastructure, the personal-grocery-shopper can continue to to sign on chains that share a similar disdain for Amazon … like Albertson’s with whom they recently partnered. Because remember, the enemy of your enemy is your friend … or something like that.
Water Cooler Talking Point: “This business model just screams “for that reason, I’m out.” Every shark on Shark Tank would want to know how a grocery delivery service will scale, how something with such thin margins will work and what’s proprietary about the operation. But this isn’t Shark Tank, this is Silicon Valley, folks. Hence the nearly $1B in VC money.”