Stanford dropouts’ firm bags $60m to speed up grocery delivery in India

Zepto, an India-based platform for instant grocery deliveries, has raised US$60 million in a round led by equity firm Glade Brook Capital.

The round, which values the firm at US$225 million, saw participation from Nexus and Y Combinator as well individual investors like former Stripe issuing head Lachy Groom, ex-WhatsApp chief business officer Neeraj Arora, and senior Microsoft executive Manik Gupta.

Kaivalya Vohra (left), Zepto’s CTO, and Aadit Palicha, CEO and founder/ Photo credit: Zepto

Established by Aadit Palicha and Kaivalya Vohra – both dropouts from Stanford University – Zepto aims to deliver groceries in 10 minutes through a network of stores. 

The Mumbai-based company has set up “dark stores” across Delhi, Chennai, Gurgaon, Bengaluru, and Mumbai. As of now, Zepto has 40 stores across India and plans to raise that number to 100 by the end of this year. 

Zepto also plans to hire up to 1,200 employees by May 2022 from the current 300. It will recruit people for roles across operations, marketing, finance, and engineering, among other business sgements. According to the company, its management includes senior leaders who have previously worked at startups like Flipkart, Uber, Dream11, Pharmeasy, and Pepperfry. 

The firm added it is “expanding quickly” across Mumbai, Bangalore, and the Delhi-National Capital Region (NCR) and will roll out in Hyderabad, Chennai, Pune, and Kolkata within the next 30 days. 

The latest funding will also be used to accelerate its growth, customer acquisition, and for setting up more stores. 

Photo credit: Zepto

“Once we started delivering in 10 minutes, our NPS (net promotor score) shot up and has constantly remained at around 85 [out of 100] with an over 50% week-on-week user retention rate, which shows the incredibly strong customer love for our product,” Vohra said in a statement.

Palicha told Tech in Asia that the company will soon raise more funds, though did not divulge the timeline or a target amount.

Zepto’s arrival comes at a time when the likes of Zomato (via Grofers), Dunzo, and Swiggy are doubling down on the instant delivery segment. Earlier this year, Grofers launched a 10-minute delivery service in as many as 10 Indian cities. Hyperlocal delivery startup Dunzo is also experimenting with a similar service in Bengaluru. InstaMart, owned by foodtech major Swiggy, also operates a network of dark stores for speedy grocery delivery.