Instacart, the popular grocery delivery app, has made its filing for a stock market flotation in New York, announcing a 31% increase in revenue for the first half of the year. This highly anticipated listing comes 15 months after Instacart submitted its initial public offering (IPO) paperwork confidentially, indicating an imminent listing. The San Francisco-based company initially planned to go public in the fourth quarter of the previous year but postponed its plans due to a sell-off in technology stocks and the Federal Reserve’s rate hikes that caused a market decline. For the first time, Instacart has provided a detailed look into its financials, reporting a revenue surge of 31% to $1.48 billion in the six months ending on June 30. The fact that the company is generating a profit could draw favor from IPO investors, who have shown a preference for profitable companies over ambitious but loss-making startups. Notably, Instacart’s net income in the six-month period amounted to $242 million, compared to a loss of $74 million the previous year. Instacart, founded in 2012 and led by Fidji Simo, former head of the Facebook app, is preparing for a promising IPO as it aims to go public in one of the most anticipated listings in recent years. The anticipated IPO of Instacart, along with SoftBank Group-backed chip designer Arm, is anticipated to revitalize the US IPO market, which has seen limited activity in previous years. So far this year, excluding special purpose acquisition companies (SPACs), $10.3 billion has been raised through 77 IPOs, nearly double the amount for the same period in 2022, according to Dealogic. As the IPO market shows green shoots, with hopes that the Federal Reserve will guide the economy to a “soft landing,” experts predict that more companies will embark on their IPO process in 2024, signaling a healthy IPO market. Instacart has appointed Goldman Sachs and JPMorgan as the lead underwriters for the offering, with its shares set to be listed on Nasdaq under the symbol “CART.” The journey to the IPO market has not been without hurdles for Instacart. The company reportedly lowered its internal valuation to as low as $10 billion in December 2022, a 74% decrease from its previous valuation of $39 billion over two years ago. However, the company later increased its valuation by 18% in April. Instacart had also considered a direct listing, where no shares are sold in advance and investors can sell their shares directly to the public. As part of its preparations for the IPO, Instacart added Snowflake CEO Frank Slootman, a software industry veteran known for his involvement in several successful IPOs, to its board in March 2021. The filing for the IPO was submitted under the name “Maplebear,” the company’s original name during incorporation.
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