Zepto’s early investors see returns as high as 6,000% in secondary markets ahead of latest funding round
With Zepto set to become India’s first unicorn of 2023, some of its early backers are being given secondary exits to make room on its cap table.
Quick commerce platform , which was last valued just north of $900 million after it raised $350 million, is set to enter the unicorn club if its latest funding efforts succeed.
The Y Combinator-backed startup is reported to be in talks to raise about $150 million from StepStone group and existing investors Nexus Ventures and Gladebrook Capital. Inc42 was the first to report on Zepto's latest fundraising efforts, which will see it valued at ~$1.3 billion.
The funding is a much-needed one as it’s locked in a battle with rivals Swiggy’s Instamart and Zomato-owned Blinkit—the three players combinedly rule the quick commerce space in India, cornering around 80% of the market.
Meanwhile, seemingly to make room on its cap table, the Singapore-headquartered company is offering exits to a clutch of its early investors, who will offload shares worth $9.6 million in a secondary transaction, as per regulatory documents sourced by The CapTable.
As per the filings, eleven investors—including Jim Breyer (former Managing Partner at Accel), Mohandass Kalaichelvan (Founder of SaaS player Spenmo), Nilam Ganenthiran (ex-President of Instacart), and Ravi Inukonda (Chief Financial Officer of US-based foodtech player DoorDash)—will be transferring their shares out of the company and into a special-purpose vehicle to facilitate this transaction.
These investors had picked up stakes in Zepto across several equity rounds between January 2021 and May 2022.
Further, some of these early investors are likely to earn returns as high as 6,000% on their initial investments via this secondary exit.
For instance, New York-based investor Jacob Honig wrote a $50,000 cheque for Zepto back in early 2021. He is transferring out his entire stake in the company and is expected to make around $3.1 million for his troubles.
While Zepto is yet to allot fresh shares to its incoming investors, holdings of its early backers, including Oliver Jung and Global Founders Capital, have increased in value by over 200% over the startup’s successive funding rounds during the last two years.
As Zepto seeks to turn profitable in 2024, the upcoming capital infusion will play a great role in achieving the feat.
Head on to The CapTable to know more.
Edited by Jarshad NK