Instacart IPO rumors are spreading. The company is one of the most anticipated IPOs of 2022 after facing rapid growth. However, the company may be in over it’s head…

So, what’s the latest news on Instacart stock? Here’s what we know…

Instacart IPO: The Business

Instacart IPO rumors are spreading that the app-based grocery delivery service is going public.

CEO Apoorva Mehta co-founded Instacart alongside Max Mullen and Brandon Leonardo in 2012. The San Francisco-based company provides an online marketplace with delivery and pickup services. Currently, Instacart is available in 5,500 cities in North America. It’s estimated that the app can be used by 85% of U.S. households and more than 70% of Canadian households.

Instacart offers services from over 700 retailers. In addition, it operates across over 65,000 stores with over 500 million products to choose from. While it was originally designed for groceries, Instacart offers a variety of new categories, including…

  • prescriptions and over-the-counter medications
  • office supplies
  • electronics
  • health, beauty and wellness
  • home decor
  • sports equipment

This allows consumers to shop for nearly anything through the app without ever leaving the comfort of home. Moreover, the effects of the pandemic caused many people to stay home, which accelerated the company’s growth.

Pandemic Accelerates Demand for Online Ordering

The past two years have been a wild ride for many companies. When COVID-19 came to the U.S., there were mandatory quarantines across the nation. People couldn’t leave their homes, restaurants and stores closed and a lot of people were (and are) afraid to get infected or infect others. Instacart became a huge hit during this time. People can now do all of their shopping without leaving their houses. The company offers no-contact delivery, with workers leaving the groceries at the customer’s door.

The company added over 200 new retailers in 2020. In addition, it expanded more than 15,000 new store locations to the Instacart marketplace. Instacart’s growth, combined with the “new normal,” makes it an appealing investment opportunity to investors. In an April 2021 report, Laurentia Romaniuk, Instacart’s Trends Expert, said

Online grocery fits seamlessly into the more flexible schedules that the world is moving toward after a collective awakening to the benefits of remote work. Given the trends we’re seeing, we expect many consumers to stick with their new mid-week grocery delivery routines, now that they’ve experienced the flexibility that online platforms like Instacart give them to build and maintain shopping lists throughout the week and easily place an order in between meetings and personal time, to be delivered in as fast as two hours.

Many people have gotten used to the hands-free and efficient use of online ordering and delivery/pick-up services. Moreover, they plan to continue using these services past the pandemic. This became evident when the company’s valuation more than doubled in less than a year, catching the eye of major investors.

Instacart Slashes $39 Billion Valuation

In March 2021, Instacart completed its latest funding round. Existing investors included Andreessen Horowitz, Sequoia Capital and Fidelity. Altogether, the funding round raised $265 million.

The funding gave Instacart a staggering $39 billion valuation. Moreover, the company doubled its valuation from $17.7 billion in less than 5 months. The figure landed Instacart the title for the 4th largest United States unicorn.

However, this proved short-term with the latest news. As pandemic restrictions ease and Covid-19 caseloads decline, stay-at-home stocks become less attractive to investors. And this is proving to be true with Instacart. The company announced in March that it had lowered its own valuation almost 40%, to $24 billion. The lowered valuation reflects the challenging market conditions.

Because Instacart is private right now, its finances are, too. However, The Information reported that the company’s 2021 revenue stands at $1.65 billion. The figure represents 10% growth year-over-year.

After the cut valuation, analysts are wondering how much an Instacart IPO could raise. Most importantly, when can investors expect Instacart stock?

Instacart IPO Filing Details

Right now, an Instacart IPO is a rumor. There are no filings or official announcements. Nevertheless, there are rumors that the company is going to go public via a direct listing. Prior to the slashed valuation, sources believed that the company behind Instacart stock could debut with a $50 billion valuation. So, it’s unknown where the company’s value stands in a public debut for now.

Instacart hasn’t released any official statements. However, investors think an Instacart IPO is closer than some may think. The company originally planned to go public in the fourth quarter of 2021. But in late 2021, the company said it was shifting focus “until next year” to strengthen its services beyond delivery. So, investors should start preparing for Instacart stock to list in 2022.

As always, make sure to research before you invest. IPOs can be volatile for the first few months. And share prices can change quickly. But if IPO investing interests you, check out our top recent IPOs and our IPO calendar. We update it daily to give you the latest news on upcoming and filed IPOs.

Investors appear bullish about the possibility of Instacart stock. However, the company relies on online shopping trends continuing post-pandemic. Instacart will have to time the market right to have a successful offering. If you’re interested in an Instacart IPO, keep an eye out for updates as we release new information.