Report: Instacart planning $30 billion IPO

Online grocery delivery giant Instacart reportedly is readying an initial public offering valued at about $30 billion.

San Francisco-based Instacart has enlisted investment bank Goldman Sachs to lead the IPO, which could be launched in early 2021, Reuters reported, citing anonymous sources.

The IPO is being stepped up, Reuters said, after California voters on Election Day approved Proposition 22. The ballot measure, supported by companies such as Uber, Lyft and DoorDash, reaffirms the independent contractor status of app-based “gig economy” workers — such as drivers and delivery personnel — and essentially quashes California Assembly Bill 5, which would have classified them as employees receiving full benefits and labor protections.

Instacart declined to comment on reports about an upcoming IPO.

Last month, Instacart said its valuation rose to $17.7 billion after a $200 million round of funding led by current investors Valiant Peregrine Fund and D1 Capital Partners. At the time, Danny Karubian, partner at the Valiant Peregrine Fund, noted that Instacart has navigated “through an operating environment unlike any we’ve ever seen.”

“We are excited to increase our investment in Instacart as the company further establishes itself as a leader in the massive North American online grocery space,” Karubian added.

Related:Aldi, Instacart team on EBT integration for SNAP online grocery purchases

Reports of an impending Instacart IPO emerged late last week, when last-mile food delivery provider DoorDash filed for an IPO. San Francisco-based DoorDash specializes in restaurant delivery but has recently made a bigger foray into on-demand grocery delivery and delved into prescription drug delivery.

Currently, Instacart offers its online marketplace, delivery and pickup services in more than 5,500 cities across North America, reaching over 85% of U.S. households and more than 70% of Canadian households. Since March, the company has launched or expanded with roughly 150 retailers and introduced delivery at more than 8,000 stores and pickup at over 1,500 stores. And in response to surging demand during the COVID-19 pandemic, the company has enlarged its base of personal shoppers by more than 500,000 to a total of over 750,000.

Instacart also has continued to expand retail partner base beyond grocery. In September, the company made forays into three new retail markets — home goods, specialty beauty care and convenience stores — through partnerships with Bed Bath & Beyond, Sephora and 7-Eleven. Previously, Instacart entered markets such as off-price/closeout retail with Big Lots, office retail with Staples U.S. and Canada, vitamins and supplements retail with Vitamin Shoppe and prescription delivery with Costco Wholesale. Instacart also delivers household decor from Walmart, pet care supplies from Petco, and over-the-counter medicines and health care products from CVS Pharmacy and Rite Aid.

Related:Instacart bags $200 million in latest financing round