During the COVID-19 lockdown, Instacart became an essential service for millions of Americans trapped at home. Even as early as February, Instacart started noticing unusual demand for items such as toilet paper, canned vegetables and long-life milk.
The next few months accelerated the growth of Instacart, which in 2019 was losing $25 million every month. It recorded its first monthly profit in April 2020, netting $10 million, and CEO Apoorva Mehta said the company had passed its 2022 goals.
While Instacart doesn’t publish usage statistics, it added 300,000 more ‘shoppers’ – the riders responsible for picking up and delivery groceries – in the first half of 2020. At the end of 2019, it employed less than 100,000. It expects to have 750,000 shoppers in total by the end of the year and generate $35 billion in grocery sales.
Instacart was one of 20 businesses started by Mehta in the early 2010s, in a wave of entrepreneurial spirit in which he created a social network for lawyers and an ad network for gaming companies. Using his experience as a supply chain engineer for Amazon, Mehta built the system which took aim at his old boss.
It wasn’t long before Amazon shot back. In August 2017, it acquired Whole Foods for $13.7 billion. At the time, Whole Foods was responsible for 10 percent of Instacart sales, and some investors worried that Amazon would end the partnership.
Instead of shutting down the upstart, the Whole Foods acquisition scared the rest of the retail world, which quickly penned agreements with Instacart. What was considered an extension of the Whole Foods brand became a marketplace for all types of retailers, which were more accommodating to Instacart out of fear of the Amazon machine.
The rise of a food delivery app would not be complete without several controversies. Like DoorDash, Instacart has been accused (and taken to court) for withholding tips and paying workers less than minimum wage. In 2019, Instacart workers set up a union and during the COVID pandemic, many walked out in protest of the lack of protective equipment.
Instacart has since provided PPE and made it much easier for customers to tip.
Will Instacart remain an essential service after lockdown? The company has no doubt received one of the greatest boosts to its chances of survival, there are even whispers of an IPO in the not too distant future. But once the US reaches a state of normality – already occurring in some areas – customer loyalty will be tested.
We have collected data and statistics on Instacart revenue, users and shoppers. Read on below to find out more.
|Launch date||1 July 2012|
|HQ||San Francisco, California|
|People||Apoorva Mehta (CEO, co-fonder), Sagar Sanghvi (CFO)|
Note: Instacart increased order volume by 500 percent during the COVID-19 lockdown. We expect Instacart has already generated more revenue in the first half of 2020 than all of 2019.
Note: Instacart does not publicise net profit / loss. According to a leaked report, it made its first monthly net profit in April 2020.
Source: The Information
Source: Progressive Grocer
Note: Due to increased demand, Instacart is currently hiring 300,000 more ‘shoppers’, the name of the employees who pick up and deliver groceries. It is on track to have 750,000 shoppers by the end of 2020.
Note: Partners refers to retail and grocery companies that operate on Instacart.
Instacart Cities Available
Sources: CB Insights
Instacart other key stats
- Instacart earned its first profit in April 2020, netting $10 million (The Information)
- It reached its 2022 goals in the fifth week of lockdown
- It is on track to process more than $35 billion in grocery sales this year (Bloomberg)
- In 2020, it has expanded its support staff from 1,200 to 18,000
- Due to the demand increase, Instacart’s value ballooned from $7.6 to $13.7 billion (TechCrunch)
- It has added more than 300,000 workers this year and may have over 750,000 by the end of year (TechCrunch)
- Instacart Express customers spend on average $5,000 per year and at double the frequency
- A study found Instacart generates $620 million in incremental state revenue (Supermarket News)
- The same study said Instacart has added 23,000 jobs and improves local job growth by four percent
- Instacart is available in 5,500 cities
- Annual user spend is $512 (Rakuten Intelligence)
- Over 500 million products are listed on Instacart
- These are provided by 300 retail partners