Until the end, the year 2022 will have been complicated for Instacart. While the American start-up, which offers a home grocery delivery service, planned to launch on Wall Street this year, it finally backtracked in a chaotic stock market for technology stocks. Worse still, the valuation of the San Francisco-based company has steadily declined in recent months.
During the Covid-19 pandemic, the American unicorn had taken advantage of the explosion of online orders generated by the multiple confinements, to the point of seeing its valuation reach 39 billion dollars in March 2021 after a round of financing of 265 million. dollars. But since then, the economic context has changed radically and Instacart now estimates that it is no longer worth “only” 10 billion dollars, according to two sources familiar with the matter cited by The Information.
Initially, the company’s valuation was reduced to $24 billion last March, then to $15 billion in July, before dropping to $13 billion in October. With 3 billion less in December, the valuation of Instacart has therefore been almost divided by four in less than two years.
Bringing Instacart to Wall Street, the challenge of Fiji Simo
The blow is tough for the company, which has raised nearly $ 3 billion since its creation in 2012 to finance its development. However, the Californian start-up hopes to take advantage of this correction in its valuation to get as close as possible to market reality and avoid suffering a dizzying fall when it enters the Nasdaq. No doubt Instacart has been cooled by the misadventure of meal delivery giant DoorDash, another big winner of the pandemic, which has seen its market capitalization drop by two-thirds since the start of the year.
Bringing Instacart to the stock market is the main challenge facing French Fiji Simo, a former Facebook executive who succeeded Apoorva Mehta as head of the company in the summer of 2021. During her ten years at the group of Mark Zuckerberg, the French leader has faced many crises. She will have to rely on this experience to enable Instacart to overcome a delicate economic context and make a successful debut on Wall Street.