Online grocery delivery startup Instacart is gearing up for its highly anticipated initial public offering (IPO), setting the stage for a potential boost to the IPO market. Sources familiar with the matter have indicated that the company is in the process of establishing a price range for its IPO and is poised to embark on an investor roadshow, possibly commencing as early as Monday.
While these insiders have requested anonymity due to the confidential nature of the discussions, they have revealed that Instacart is contemplating pricing its IPO on September 19, with trading anticipated to begin the following day. However, it’s important to note that these plans remain subject to fluidity, with the timeline susceptible to alterations based on market conditions.
The potential IPO of Instacart could potentially invigorate an IPO market that has been experiencing intermittent surges of activity. Notably, semiconductor designer Arm Holdings Ltd. recently set a price range for its IPO, which is heralded as the most significant listing of the year and is slated to commence trading as early as next week. Furthermore, e-commerce marketing firm Klaviyo Inc. is also making preparations for its own public listing, reportedly adhering to a timeline that closely mirrors that of Instacart. According to individuals privy to the deliberations, Klaviyo’s price range could be unveiled as soon as Monday, with a possible listing date of September 19.
Klaviyo and Instacart have both declined to comment on these speculations.
Instacart, which was founded in 2012, has been strategizing its move into the public market for several years, with aspirations to capitalize on its exponential growth during the COVID-19 pandemic when online grocery shopping became the new norm. The startup managed to secure $2.74 billion in funding during its early stages, culminating in a valuation of $39 billion in 2021, according to data from PitchBook. However, as the pandemic gradually subsided and diners ventured out of lockdowns to return to restaurants, Instacart’s growth trajectory began to taper. Consequently, the company was compelled to trim its internal valuation thrice in the past year, eventually settling at around $13 billion by October 2022.
PepsiCo Inc. is one of the notable backers of Instacart’s IPO, as disclosed in the company’s prospectus.
This impending IPO marks the inaugural foray of Instacart into the public market, signifying a pivotal moment for the company. Success in achieving its IPO objectives could potentially pave the way for other startups contemplating similar moves. While it may be the first in a series of major IPOs anticipated in 2023, only time will reveal the full extent of its impact.
Instacart’s decision to pursue an IPO underscores the ongoing transformations in the business landscape, with an increasing number of companies shifting their focus from traditional in-store sales to more dynamic online alternatives. This strategic move may very well serve as a harbinger of broader industry trends and developments in the years to come.
Source: Bloomberg
