Zepto raises $350 mn to increase domestic shareholding ahead of India IPO

Zepto co-founders Aadit Palicha (L), and Kaivalya Vohra (R)

Quick commerce unicorn Zepto has extended its fundraising spree with a $350-million round, the third in five months, led by Motilal Oswal’s Private Wealth division. It saw participation from a clutch of high net-worth individuals (HNIs) and family offices (FOs) as the startup looks to raise its domestic shareholding ahead of a potential listing next year.

Motilal Oswal’s Raamdeo Agrawal, the Taparia Family Office, Mankind Pharma Family Office, RP Sanjiv Goenka Group, Claypond Capital, Cello Family Office featured among the participants in Zepto’s latest round which retained the earlier valuation of the company at $5 billion.

The Haldiram Snacks Family Office, Sekhsaria Family Office, Kalyan Family Office, Happy Forgings Family Office, Mothers Recipe Family Office (Desai Brothers), actor Abhishek Bachchan and cricketer Sachin Tendulkar also pumped in money to buy shares in Zepto, the company said.

At least three investors – Motilal Oswal’s Agrawal, Bachchan and Tendulkar – had earlier backed Zepto’s rival Swiggy, according to media reports.

Upsized round
Zepto had earlier set out to raise $150 million, as Moneycontrol had reported last month, but later increased the round size to accelerate its plans to become a domestic company majorly owned by Indian investors.

“When we started this venture, the risk appetite among domestic investors was limited—especially to trust 18-year-olds with their money. Today, we are humbled to have reached a place in India’s economic growth where we’ve not only fostered that trust but also spearheaded a fundraise of this magnitude, which will hopefully set a precedence for the startups that follow,” Aadit Palicha, CEO and co-founder of Zepto, said in a statement.

Zepto had previously raised $665 million at a valuation of $3.6 billion in June and then scooped up another $340 million when it was valued $5 billion a few weeks later in August, as was first reported by Moneycontrol. In total, out of the nearly $2 billion that the three-year-old startup has raised, over $1.3 billion has come only in the last five months, underscoring investor appetite for the sector.

The investors are rushing to back rapid delivery players at a time when quick commerce has gone from a good-to-have sector to an indispensable one in just a few years. The red-hot industry reached a size of $5.5-6 billion in just four years.

Zepto’s back-to-back fundraise coincides with its plans to go public. The company has picked Goldman Sachs, Morgan Stanley, and Axis Capital as part of its IPO syndicate, as was first reported by Moneycontrol on September 7.