Skip to content

Home Delivery From TJ’s and Costco Via Instacart Raises $8.5M

July 10, 2013

Screen Shot 2013-07-10 at 11.36.58 AM

San Francisco-based Instacart has raised $8.5M led by Sequoia Capital. Also backing are Khosla Ventures, Canaan Partners, SVAngel and Paul Buchheit, the creator of Gmail.

Instacart will shop for and deliver groceries to your door within 2 hours for a fee of $3.99. You can order from Costco, Whole Foods or Trader Joes,which don’t deliver. The comparable here is not to Webvan or Amazon groceries but to a freelance car service like Lyft where anybody with a car can be a driver. We don’t get how at that price they will get someone to drive to a store and buy groceries then drive to the customer’s home.

The deal is notable because Sequoia’s Mike Mortiz was on the board of Webvan. He says“We had still been receiving outpatient therapy for our Webvan fiasco,” says Moritz, who’s joining the year-old company’s board. Still, with Instacart, he says, “There is little danger of a relapse.”  Everyone we know who was involved with Webvan says that the model works and there are a number of companies providing it today. Other than the pricing we wonder what happens if Trader Joes and Costco start to home deliver.

Instacart today says it has 200 personal shoppers in the Bay Area. The Instacart app has maps of local supermarkets and can direct  personal shoppers to specific aisles. Founder Apoorva Mehta says Instacart’s “secret sauce” is its fulfillment software, which allows the online retailer to combine orders placed at different times and fill them from different stores.

Screen Shot 2013-07-10 at 11.47.46 AM

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: