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Instacart has raised another $200M at a $4.2B valuation

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Re: Instacart has raised another $200M at a $4.2B valuation

#21

Post by jotm »

jimmy1 wrote: post #12
spiderPig wrote: post #2

Wow, so they've raised close to $1bn so far! Wonder how many of these delivery services like Doordash, Postmates, Grubhub, Caviar, Uber eats etc will survive the next economic downturn.

As a former restaurateur, I would like to tell you, contrary to popular opinion, during the last major economic downturn in 2008 (2009 for me since I was in a southern state, and the downturn hit us a bit later than most), spending money out to eat actually went up . The theory goes a little something like this -- people actually spend more money on themselves to cheer themselves up when life gets shittier. So folks,…

Surprisingly, most poor people order takeaways the most around here, as well.

Re: Instacart has raised another $200M at a $4.2B valuation

#22

Post by usaphp »

clay_the_ripper wrote: post #14

I have never had a good experience with instacart. I’ve ordered from them probably 10-15 times and every single time, without fail, they either forget an item or replace an item with another item that I don’t want. This makes the service unusable, because if I’m cooking dinner that night and want to order instacart, there’s a high likelyhood I’ll be missing something crucial for my recepie, meaning I’ll have to go to…

> Amazing prime now on the other hand has never messed up an order.

Not sure if it’s possible in prime now (could not find it) but I like the option in Instacart to describe an item you need which is not present in their directory, it saved me lots of times when something is not listed on prime now and I can just request it using Instacart, worked perfectly for me every time

Re: Instacart has raised another $200M at a $4.2B valuation

#23

Post by jotm »

jxub wrote: post #10

Another valueless "disruption" being injected play money to destabilise the semblance of healthy capitalism we had on a macro level. Venture capital enables subsidies to speculative companies in hope of a small probability of profit, which destroys perfectly good small companies [0] , and acts as a libertarian version of socialism [1]. This exposes the fabric of a normal economy to small stressors, a couple of which…

Prove it yourself or get downvoted to shit (not by me). This isn't a real discussion, it's HN.

Re: Instacart has raised another $200M at a $4.2B valuation

#24

Post by lerie82 »

I was in virginia this past year (for a year) and I bought a little car, sold it. I didn't think about groceries when I sold it, I walked to work, it was close. I found a place online that actually delivered groceries to where I was and it was instacart.

I loved this service while I was there, and even in this little place in Arizona they are looking for drivers.

This service was amazing, you can substitute items for other items, you track them on a Google maps widget on their site, you get texts and instant communication with your delivery person and can choose to tip after the delivery is done.

Not once did the driver forget an item (multiple drivers) and one time they didn't have the item I wanted and the driver felt bad and for Christmas without notice left me a coffee cake tree on my doorstep with the item they didn't have previously.

This service deserves the valuation they have and I couldn't believe it was as big as it was when I found it last year, I thought it was a rinky-dink service that turned out to be amazing.

Re: Instacart has raised another $200M at a $4.2B valuation

#25

Post by whoisjuan »

spiderPig wrote: post #2

Wow, so they've raised close to $1bn so far! Wonder how many of these delivery services like Doordash, Postmates, Grubhub, Caviar, Uber eats etc will survive the next economic downturn.

UberEats will likely win in the long run... On-demand is just a long-term game of leading and losing money... Uber has the distribution and the money that will allow them to lead and lose for longer than anyone else.

How much money can all these companies lose before finding themselves in a dead-end? (no positive cash-flow, no more investors willing to invest, no more local market first mover advantage).

People who deliver for these companies will do it for the ones that can give them more business and larger commissions. People who order from these companies will do it from the ones with the largest selection and the lowest fees... Only Uber can pull-off the economies of scale to arbitrate those two sides without running out of money.

Re: Instacart has raised another $200M at a $4.2B valuation

#26

Post by octernion »

jxub wrote: post #18
Judgmentality wrote: post #13

Earlier quoted context omitted.

Even though I agree with you, it would make for a much better conversation if you provided some evidence yourself instead of insisting the onus is on others to prove you wrong.

You're right, I sound like a prick even though I hadn't meant it. I'll grab some data later on to construct a more compelling case against this type of funding.

as an instacart engineer, i'd be super curious as well. i haven't seen many actual data-driven cases (noting this honestly and thank you for acknowledging the attitude in your initial comment :)

Re: Instacart has raised another $200M at a $4.2B valuation

#27

Post by cryptoz »

jotm wrote: post #20
cryptoz wrote: post #15

Earlier quoted context omitted.

> 2) Economic downturn: Will people still order groceries at a premium? I'm not sure about the data and large trends for this, but here's my anecdote: Right now Instacart is the cheapest way for me to get groceries. Someone with a gun took my driver's license from me a few months ago, my bike was dismantled by thiefs, and I don't live within walking distance of a grocery store. Lyft/Uber there and back is $20. Bus th…

Might be time you move elsewhere, I think...

If you mean the crime, that was Oakland, and I have recently left. But I still don't currently live near a grocery store. Maybe next move.

Re: Instacart has raised another $200M at a $4.2B valuation

#28

Post by kcorbitt »

clay_the_ripper wrote: post #14

I have never had a good experience with instacart. I’ve ordered from them probably 10-15 times and every single time, without fail, they either forget an item or replace an item with another item that I don’t want. This makes the service unusable, because if I’m cooking dinner that night and want to order instacart, there’s a high likelyhood I’ll be missing something crucial for my recepie, meaning I’ll have to go to…

I suspect the fact that Amazon is so good at food delivery is exactly why Instacart has been able to raise at such a high valuation. Amazon's purchase of Whole Foods, their Amazon Go store, and generally competent execution of grocery delivery has put the fear of $DIETY into all the incumbent grocery chains. They realize that they're late to the game and don't have the internal talent to develop an effective and convenient home-delivery competitor, so they're forced to partner with Instacart, who is hoping to commoditize them.

Re: Instacart has raised another $200M at a $4.2B valuation

#29

Post by jjxw »

roymurdock wrote: post #16
jedberg wrote: post #5

From an outsiders perspective this looks like a bad investment. But I'm an outsider, so I know I don't have all the information. I would love to get an insiders perspective on why this is a good investment. My two main concerns: 1) Amazon and Whole Foods: Are they not a concern? 2) Economic downturn: Will people still order groceries at a premium?

I assume instacart has a liquidity event (IPO) lined up for the near future (next 12 months), and a few late stage and previous investors are laying down a cash runway to get the company there. Notably this round ($200m) was less than their last round 1 year ago ($400m) so it seems growth has slowed and its time for an exit. So its not a bet, its a holdover cash infusion until the IPO, and is not exactly risky given…

From one armchair economist to another I suspect the Federal Reserve will have something to do with what I wouldn't call a "recession" per se, but a slowing of growth through interest rate hikes.

Re: Instacart has raised another $200M at a $4.2B valuation

#30

Post by Androider »

clay_the_ripper wrote: post #14

I have never had a good experience with instacart. I’ve ordered from them probably 10-15 times and every single time, without fail, they either forget an item or replace an item with another item that I don’t want. This makes the service unusable, because if I’m cooking dinner that night and want to order instacart, there’s a high likelyhood I’ll be missing something crucial for my recepie, meaning I’ll have to go to…

Exact same experience. Instacart shopper cannot find extremely common items and tries to replace them with 2-3x more expensive options.

The whole model of the shopper walking the isles to pick the products is wrong. It's inefficient and a recipe for disappointment, because what you see on their web page is just a guess at what the store has and the shopper can find.

I too have used Instacart probably 10 times, but never will again. It is also all but guaranteed that Whole Foods will drop Instancart like a hot potato for their own in-house service, so the valuation is completely wrong in my opinion.

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