Maplebear Inc.
Instacart
TypePublic
IndustryRetail
FoundedJune 2012 (2012-06)
Founders
Headquarters50 Beale Street
San Francisco, California, U.S.
Area served
United States and Canada
Key people
Fidji Simo (CEO)[1]
ServicesGrocery delivery
RevenueIncrease US$2.55 billion (2022)
Increase US$62 million (2022)
Increase US$97 million (2022)
Total assetsIncrease US$3.67 billion (2022)
Total equityNegative increase US$−64 million (2022)
Owners
Number of employees
3,486 (2023)
SubsidiariesCaper AI
Websitewww.instacart.com
www.instacart.ca
Footnotes / references
[2]
The Instacart logo is a simplified carrot. Logo since 2022.

Maplebear Inc.,[2] doing business as Instacart, is an American delivery company based in San Francisco that operates a grocery delivery and pick-up service in the United States and Canada accessible via a website and mobile app.[3] It allows customers to order groceries from participating retailers with the shopping being done by a personal shopper.[4] The company also provides alcohol delivery in states and provinces where it is allowed. It has partnerships with 1,400 retail banners comprising 80,000 stores. In 2022, it fulfilled 262.6 million orders with a total transaction value of $28.8 billion and an average transaction value of $110.[2]

History

Corporate history

After getting inspiration from being low on groceries without owning a car[5] as well as his trips to the grocery store by bus in the cold while growing up in Canada,[6] Apoorva Mehta founded Instacart in 2012 at age 26. He tried to apply for funding through Y Combinator but missed the deadline. He eventually got a meeting by using the Instacart mobile app to deliver a six-pack of beer from 21st Amendment Brewery to a Y Combinator partner[5] and was admitted to the summer of 2012 batch.[7] Y Combinator helped Mehta raise $2.3 million in funding[5] and enabled him to meet his two co-founders, Max Mullen and Brandon Leonardo.[6] The company’s name is a combination of "maple," in reference to Canada, and "bear," for the logo on the California state flag, as Mehta grew up in Canada and moved to California.[8]

In July 2021, Fidji Simo was appointed CEO, while Mehta transitioned to Executive Chairman of the Board.[9]

In July 2022, Simo was appointed to succeed Mehta as chairperson once the company completed its initial public offering.[10]

In September 2023, the company became public through an initial public offering raising $660 million, valuing the company at about $10 billion.[11][12] Mehta left the company after it went public.[13]

Service launches and grocery partnerships

Instacart was first launched in San Francisco in 2012.[14]

In November 2013, Instacart added alcohol delivery in areas where alcohol delivery was legal.[15]

The company expanded across the United States in the following years.[16] [17][18]

In November 2017, the company expanded to Canada, first with a partnership with Loblaw Companies in Toronto and Vancouver.[19][20]

By May 2018, Instacart was available for use in 11 Canadian markets and was planning expansions for five more markets.[21]

In September 2018, Instacart announced national expansions with retailers, including Walmart Canada, Staples Canada, M&M Food Market,[22] Kroger, Aldi, Sam's Club, Publix, and Costco.[23][24]

In November 2018, Instacart announced the national expansion of Instacart Pickup, a grocery click-and-collect service, whereby users pick up their pre-packaged orders at the grocery store.[25]

In March 2019, Instacart expanded its same-day alcohol delivery service in the U.S.[26]

Effective May 2019, Whole Foods Market ended its partnership with Instacart.[27][28]

By the end of December 2019, Instacart's alcohol delivery service included over 30 new partners in more than 20 states and Washington, D.C., such as Albertsons, Aldi, Sam's Club, BJ's Wholesale Club, Sprouts Farmers Market, The Fresh Market, and Total Wine & More.[29][30]

In April 2020, during the COVID-19 pandemic, Instacart introduced a contactless delivery option, safety kits and guidelines for shoppers, and new sick leave policies and pay for those affected by COVID-19.[31][32]

In May 2020, Instacart began a partnership with Rite Aid, offering its service across 2,400 locations in 18 states.[33] In August 2020, Instacart entered its first partnership with Walmart in the U.S. to offer same-day delivery services. The partnership is a pilot program beginning in Los Angeles, San Francisco, San Diego, and Tulsa.[34][35] Additional partnerships in June included C&S Wholesale Grocers and Staples.[36][37]

On March 16, 2022, in partnership with TikTok, Hearst Magazine and Tasty, Instacart launched Shoppable Recipes with new product integrations that allow food creators to make their recipes shoppable on Instacart.[38]

On March 23, Instacart introduced the Instacart Platform, a program with services for retailers. The platform launched with features for advertising, home delivery, and inventory counting.[39][40]

In May 2022, Instacart unveiled new partnerships with Canada's top 5 grocers: Metro, Giant Tiger, Galleria Supermarket and more, expanding same-day delivery countrywide.[41]

In July 2022, EBT SNAP was accepted in 10 additional states: Colorado, Hawaii, Idaho, Louisiana, Montana, New Mexico, Oregon, Utah, Washington, and Wyoming - with launch partners Albertsons Companies and Sprouts Farmers Market.[42]

In August 2022, Instacart added Carts to the app to allow users to buy items listed in shopping carts by celebrities, influencers, retailers, and other public figures.[43][44]

Pricing changes

In August 2013, Instacart began offering an annual membership service called Instacart Express.[45] In June 2022, Instacart Express was renamed Instacart+ and new family shopping features, including sharing membership and shopping-cart collaboration with another family member for free, were added.[46]

In April 2018, Instacart changed its prices by instituting a mandatory 5% service fee on all orders. It originally offered an optional 10% service fee that went directly to Instacart that could be turned off. It also returned the gratuity option back to the checkout screen and raised the default value from 0% to 5%.[47]

Worker classification issues

In June 2015, Instacart allowed some shoppers to choose to be part-time employees, starting with Chicago and Boston[48][49] and extending its offer to shoppers in Atlanta, Miami, and Washington, D.C. the following month.[50]

In March 2017, Instacart agreed to pay $4.6 million to settle a class action settlement stemming from the alleged misclassification of its personal shoppers as independent contractors. The suit, filed in March 2015, alleged 18 violations, including improper tip pooling and failure to reimburse workers for business expenses.[51][52]

Worker relations and pay issues

In November 2016, the company removed the option to leave a gratuity in exchange for a service fee that would be used to pay workers instead. The backlash against the policy from customers and some shoppers forced the company to reinstate the option only weeks later with modifications that placed the tip under the service fee section on a separate page.[53][54]

In November 2017, some Instacart workers participated in a strike action, alleging wages as low as $1 an hour. Instacart claimed that the strike had no impact on its operations.[55]

In February 2018, Instacart mistakenly withheld tips given by customers to shoppers, blaming a software bug. In addition, customers were often charged for service fees that were supposed to be waived.[56]

In November and December 2018, Instacart again changed its pay system for its personal shoppers; shoppers claimed this pay system resulted in substantially lower pay and boycotted. Instacart customers complained on social media that their orders were being delayed.[57][58][59]

In February 2019, an online organizing campaign, including shoppers, provided examples of payments to shoppers as low as $0.80 per delivery. The company announced that it would revise its pay system and give back pay to some workers.[60][61] Under the revised pay system, tips were no longer factored into the minimum base wages, which were newly set at $7–10 for a full-service shopping order (based on delivery market) and $5 for delivery only.[62][63]

On April 11, 2019, the company expanded its services to offering an on-demand option for its workers, in order to allow workers to work more flexible schedules.[64]

In February 2020, Instacart employees in Skokie, Illinois voted to form a trade union. Instacart said it "will honor" the vote, pending certification of the results. In the lead-up to the election, high-level Instacart managers distributed anti-union literature at a Skokie grocery store where some of the unionizing workers picked up groceries for delivery.[65] At the time, about 12,000 of Instacart's 142,000 workers were employees with the option of unionizing.[66]

From mid-March to mid-April 2020, during the COVID-19 pandemic, as a result of a surge in usage of the mobile app, Instacart hired an additional 300,000 workers to meet the surge in demand for grocery deliveries.[67][68][69]

Instacart workers threatened to strike on March 27, 2020 due to a lack of COVID-19 safety measures.[70] Workers demanded hazard pay and personal protective equipment.[71] In early April 2020, Instacart began providing safety kits to workers.[72] In May, workers reported being denied sick leave despite quarantining under the advice of a doctor. Instacart required that workers either get a positive COVID-19 test or be under a mandatory quarantine by a public health agency or other government agency.[73][74] By June, Instacart changed its sick leave rules in an agreement reached by it and D.C. Attorney General, Karl Racine. Under the agreement, Instacart provided paid leave to workers who were clinically diagnosed with COVID-19 by a doctor or other medical professional along with those who had a household member contract COVID-19. The agreement also provided access for workers to telemedicine services.[75][76]

In January 2021, Instacart announced a $25 stipend to provide financial assistance to company shoppers who choose to get the COVID-19 vaccine.[77][78]

In January 2021, the company announced plans to lay off nearly 2,000 employees, including all of its employees who had voted to unionize. Instacart said that the layoffs were due to stores increasingly using Instacart to have consumers place orders, but have their own employees fulfill the order instead of Instacart's workforce, reducing reliance on Instacart's in-store shoppers.[79][80][81]

Acquisitions

In January 2018, the company acquired Toronto-based Unata, a white-label platform for grocers, for $65 million.[82][83][84]

In October 2021, Instacart acquired smart cart and checkout company Caper AI for $350 million.[85]

In September 2022, Instacart announced the acquisition of Eversight, an artificial intelligence pricing platform for brands and retailers.[86][87]

Also in September 2022, the company acquired Rosie, an e-commerce platform for local and independent retailers and wholesalers.[88]

Service model

Orders are fulfilled and delivered by a personal shopper, who picks, packs, and delivers the order within the customer's designated time frame—within one hour or up to five days in advance.[89][90]

Alcohol

Instacart provides alcohol delivery and pickup in 27 states,[91] 2 provinces in Canada, and Washington, D.C.[92] Instacart has alcohol delivery partnerships with more than 500 retail banners that span more than 25,000 stores.[93][94]

References

  1. ↑ Sorvino, Chloe (July 8, 2021). "Instacart Taps Facebook Executive As CEO, Names Founder Apoorva Mehta To Executive Chairman". Forbes.
  2. 1 2 3 "Maplebear Inc. Form S-1". U.S. Securities and Exchange Commission. August 25, 2023.
  3. ↑ Captain, Sean (April 11, 2019). "Instacart offers drivers more flexibility on when and what they deliver". Fast Company.
  4. ↑ "How Instacart Works, What It Costs, And What You Should Know About Using It for Grocery Delivery". The Kitchn.
  5. 1 2 3 Huddleston Jr., Tom (September 20, 2023). "37-year-old quit Amazon and started 20 companies before coming up with Instacart—now he's worth $1.1 billion". CNBC.
  6. 1 2 "Q&A with Apoorva Mehta, Founder & CEO, Instacart". Y Combinator. October 17, 2018.
  7. ↑ Novellino, Teresa (December 31, 2014). "How this ex-Amazon engineer launched $2 billion startup Instacart". American City Business Journals.
  8. ↑ Moyer, Liz; Cho, Janet H. "Instacart Is Also Called Maplebear. What's in a Name?". barrons. Retrieved November 21, 2023.
  9. ↑ HINCHLIFFE, EMMA (July 8, 2021). "Fidji Simo tapped as CEO of Instacart, shrinking the ranks of top female execs at Facebook". Fortune.
  10. ↑ Jacob, Denny (July 22, 2022). "Instacart's Founder to Step Down as Chairman After IPO". The Wall Street Journal. ISSN 0099-9660.
  11. ↑ Durbin, Dee-Ann (September 18, 2023). "Instacart sets IPO price at $30 a share, valuing the company at about $10 billion". Associated Press.
  12. ↑ "A day after a blockbuster debut, Instacart's shares go in reverse and briefly sink below their IPO price". Fortune. September 20, 2023.
  13. ↑ "Instacart's cofounder has a net worth of $1.3 billion after IPO—and today he cut all ties with the company". Fortune. September 19, 2023.
  14. ↑ Empson, Rip (August 1, 2012). "Y Combinator-Backed Instacart Wants To Be Amazon With One-Hour Delivery". TechCrunch.
  15. ↑ Wilhelm, Alex (November 21, 2013). "Wine-As-A-Service Company Rewinery Has Shut Down". TechCrunch.
  16. ↑ Gorden, Audrey (April 20, 2017). "Instacart expands online grocery shopping to Oak Park, Oak Lawn and Franklin Park". Chicago Tribune.
  17. ↑ "Instacart Expands In OC, Adds 99 Ranch". SocalTech. October 10, 2016.
  18. ↑ Mayerle, Jennifer (November 16, 2016). "Which Grocery Delivery Service In The Twin Cities Is Best?".
  19. ↑ George-Cosh, David; Bensinger, Greg (September 28, 2017). "Instacart Is Expanding to Canada in Amazon Battle". The Wall Street Journal.
  20. ↑ Kopun, Francine (November 15, 2017). "Walmart, Loblaws face off over home delivery of groceries". Toronto Star.
  21. ↑ "Loblaw expanding online grocery pick-up and delivery business across Canada". Global News. The Canadian Press. May 2, 2018.
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  26. ↑ Redman, Russell (March 12, 2019). "Instacart ramps up alcohol delivery". Supermarket News.
  27. ↑ Boyle, Matthew (October 7, 2019). "No Whole Foods, No Problem: Instacart Shakes Off Loss of Grocer". Bloomberg News.
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  29. ↑ Redman, Russell (December 17, 2019). "Costco, Instacart expand alcohol delivery to 200 club stores". Supermarket News.
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  42. ↑ McCarthy, Kelly (July 28, 2022). "SNAP benefits expanded to help with access for online grocery shopping". Good Morning America.
  43. ↑ Best, Mariana (August 31, 2022). "Instacart's latest feature lets you shop Lizzo's vegan grocery list". SFGATE.
  44. ↑ Walsh, Karla (August 29, 2022). "You Can Now Shop Lizzo's Personalized Grocery List on Instacart—See What Made the Cut". Dotdash Meredith.
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  53. ↑ Del Rey, Jason (February 20, 2017). "Instacart is playing games with its workers' pay — and will eventually suffer for it". Recode.
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  65. ↑ Gurley, Lauren Kaori (January 27, 2020). "Leaked Memos Show Instacart is Running a Union-Busting Campaign". Vice.
  66. ↑ Gurley, Lauren Kaori (February 3, 2020). "Instacart Workers Win Historic Union Election". Vice.
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  71. ↑ Olson, Alexandra; Anderson, Mae (March 30, 2020). "Some Instacart, Amazon workers strike as jobs get riskier". ABC News. Associated Press.
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  73. ↑ Kerr, Dara (May 20, 2020). "'An artificially high bar': Instacart's COVID-19 sick leave is hard to get". CNET.
  74. ↑ Brandom, Russell (May 26, 2020). "The human cost of Instacart's grocery delivery". The Verge.
  75. ↑ Brandom, Russell (June 2, 2020). "Instacart will expand sick pay to more gig workers". The Verge.
  76. ↑ "Instacart Survived Covid Chaos — But Can It Keep Delivering After The Pandemic?". Forbes. January 27, 2021.
  77. ↑ Crist, Ryan (January 14, 2021). "Instacart offers $25 stipend for shoppers who take the COVID-19 vaccine". CNET.
  78. ↑ DiFeliciantonio, Chase (January 15, 2021). "Instacart to provide $25 vaccine stipend for gig-work shoppers". San Francisco Chronicle.
  79. ↑ Kaori Gurley, Lauren (January 21, 2021). "Instacart will lay off all of its unionized workers". Vice Media.
  80. ↑ O'Brien, Ashley (January 21, 2021). "Instacart is cutting more than 1,800 jobs, including its only unionized workers". CNN.
  81. ↑ Albrecht, Chris (January 22, 2021). "Instacart Expands Curbside Pickup Options for Retailers". The Spoon.
  82. ↑ Crook, Jordan (January 16, 2018). "Instacart acquires Toronto-based Unata". TechCrunch.
  83. ↑ Sawers, Paul (January 16, 2018). "Instacart acquires Canada-based grocery ecommerce platform Unata". VentureBeat.
  84. ↑ "Instacart Acquires Unata" (Press release). PR Newswire. January 16, 2018.
  85. ↑ Wiggers, Kyle (October 19, 2021). "Instacart acquires smart checkout startup Caper AI for $350M". VentureBeat.
  86. ↑ Malik, Aisha (September 1, 2022). "Instacart acquiring AI-powered pricing, promotions platform". TechCrunch.
  87. ↑ Bursztynsky, Jessica (September 1, 2022). "Instacart acquires AI pricing platform Eversight". Fast Company.
  88. ↑ Malik, Aisha (September 7, 2022). "Instacart acquires Rosie to offer new e-commerce solutions for local and independent retailers". TechCrunch.
  89. ↑ Lori (January 8, 2019). "Instacart Launches Same-Day Grocery Delivery Service in Winchester". iHeartMedia.
  90. ↑ "The Fresh Market Expands Instacart to All Stores". Progressive Grocer. May 16, 2019.
  91. ↑ "Instacart Alcohol Delivery: How It Works and How Much It Costs". Shopfood.com. April 19, 2022. Retrieved January 31, 2023.
  92. ↑ Biryukov, Nikita (August 26, 2022). "New Jersey will allow DoorDash, Instacart to deliver alcohol and cocktails". New Jersey Monitor. Retrieved January 31, 2023.
  93. ↑ Campbell, Jeff (May 11, 2020). "Can Instacart Deliver Alcohol? (Yes, but not in every state)". The Grocery Store Guy. Retrieved January 31, 2023.
  94. ↑ Horwath, Bryan (September 12, 2022). "Demand grows for streamlined local liquor-delivery laws - VEGAS INC". Las Vegas Sun. Retrieved January 31, 2023.
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