Zepto raises $450 million at $7 billion valuation as Indian quick commerce market heats up

Indian e-commerce startup Zepto said it has raised $400 million in a funding round led by a new investor, California Public Employees Retirement System (Calpers), a US pension fund. The round, which is a mix of primary and secondary investment, also has participation from existing investors including Avenir, Avro, Lightspeed, Glade Brook, The Stepstone Group and Nexus Venture Partners. After this funding, the company plans to go public next year.

Zepto competes with other fast commerce players such as Eternal’s (formerly Zomato) BlinkIt, Swiggy Instamart, and Tata-owned BigBasket — all part of publicly listed companies. Startups have been on a funding spree as it picks up $1.3 billion in the span of a few months last year. Since Zepto’s last funding round in November 2024, Swiggy has built Its public debut on the Stock Exchange of Indiaand Blinkit Beats Zomato Total order value (total value of customer orders) for Q1 2025.

The company faces competition from legacy ecommerce players viz Flipkart And the amazonwho have started their own express trade delivery services.

Startups are also looking at vertical e-commerce offerings. Axel-backed swish And Jing is working in the food supply space; Nykaa is publicly listedFlipkart-owned Myntra, Silkk, and Blip aim to deliver clothes to customers within an hour; Lightspeed-backed snabbit allowing users to book home services like cleaning within 10 minutes; And startups like FirstClub are taking over A curation approach to grocery delivery.

Zepto and CEO Aadit Palicha are confident about the startup’s growth Palicha said the company has scaled from 500,000 daily orders five quarters ago to 1.7 million daily orders and predicts that growth will continue.

“The key metric for this round of funding was the ability to make dark stores profitable while acquiring more than 10 million new monthly transacting users. We’ve obviously invested incrementally in customer acquisition and store launch. But even after you do that, we’ve been able to keep the stores profitable,” Policha told TechCrunch.

BlinkIt, Instamart, and Zepto operate in many of these spaces, with food delivery being the most prominent. However, Zepto had his break Zepto offers cafes in 44 cities due to staffing challenges.

Signs of a fast-moving trade market in India are encouraging. Morgan Stanley predicts that the rapid commerce market could reach $42 billion by 2030. Bernstein said in a note in March that it could reach $100 billion in a decade. The analyst firm also noted that fast-casual in target markets is the primary way people are buying groceries now.

Zepto has mainly focused on major cities in India for service expansion. JP Morgan noted earlier this month that BlinkIt has a dark store network of warehouses to fulfill online orders in over 204 cities, compared to Swiggy Instamart in over 104 cities and Zepto in over 80 cities in India.

The investment is a significant one for CalPERS. Pension funds typically invest in venture capital through intermediary funds rather than directly investing in startups. Calpers is aggressively expanding its venture exposure through 2022 after what officials called a “lost decade” of underperformance, raising its venture allocation from about $800 million to a target of $5 billion. The fund’s decision to lead a round in an Indian fast-commerce startup apparently signals strong institutional confidence in India’s fast-delivery sector, and perhaps CalPERS’s growing appetite for direct venture investments in emerging markets. Notably, Calpers is an investor in funds from Zepto’s existing backers such as Lightspeed and General Catalyst.