Zepto in talks for another fundraise at a valuation of $4.6B: Report

Quick commerce unicorn Zepto is in talks to raise another $400 million at a valuation of $4.6 billion just a week after it secured $665 million in funding, said a report by The Information. 

According to the report, the company is in discussion with several firms for fresh funds after its previous funding that valuated the company at $3.6 billion. DST Global and Avra co-led the last round, which also saw participation from Avenir and existing investors like Nexus Venture Partners, StepStone Group, Contrary and Glade Brook Capital. 

Zepto Co-founder and CEO Aadit Palicha told the publication that the company expects to cross $1.5 billion in annualised sales next month and is currently generating annualised gross profit at a $300 million rate based on its current monthly profit. 

Zepto declined to comment on queries sent by Yourstory.

Zepto had earlier said that its GMV has multiplied year-on-year to a base of more than $1 billion. Additionally, it was reported that nearly 75% of the company's stores, dark stores or warehouses achieved full EBITDA positivity as of May 2024. This level of profitability, which previously took nearly two years to reach, is now attained within just six months.

The company is close to EBITDA positivity with 140% YoY growth on a base of $1 billion annualised GMV. It further plans to operate with “fiscal discipline” as it scales from 350 stores to 700 stores by reinvesting the capital generated from mature stores back into the business. “If we are able to achieve this while continuing to delight customers, I believe we will be ready to go public relatively soon,” Palicha said. 

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Zepto’s fundraise comes at a time when other foodtech and ecommerce startups are focusing on quick commerce as a major driver for growth. Zomato expects the number of monthly transacting users (MTUs) on its quick commerce platform, Blinkit, to cross its parent's figure soon. The company, in its quarterly earnings, also highlighted that it plans to increase the number of dark stores to 1,000 by March 2025. 

Swiggy, which has already filed for its IPO, is focusing on profitability and expansion. The company added additional revenue streams through restaurant advertising and platform fees. Investors expect to see the Sriharsha Majety-led company grow on the back of increased penetration of its quick commerce business, higher order value, and organic customer growth. 

(The story was updated to reflect the company's response.)