Instacart's Valuation Reaches $9.9 Billion Amid Resurgent IPO Market

Maplebear Inc., the parent company of grocery delivery platform Instacart, has announced a fully diluted valuation of $9.9 billion for its initial public offering (IPO). The IPO was priced at $30 per share, reaching the upper end of its indicated range, following strong investor demand. It raised $660 million through the sale of 22 million shares, with trading set to commence on Nasdaq.

While this valuation is considerably lower than the $39 billion valuation assigned to Instacart in a private funding round in March 2021, during the peak of the COVID-19 pandemic, it reflects the current market conditions.

The IPO market in the United States has been revitalized after a relatively dry spell this year and in 2022, with successful offerings like SoftBank Group Corp's chip designer Arm, which achieved a fully diluted valuation of $62 billion within three days of trading on Nasdaq. Additionally, marketing automation company Klaviyo Inc. has increased its proposed IPO price range, targeting a fully diluted valuation of up to $9 billion in its upcoming stock market debut.

Instacart's IPO attracted strong interest from investors, with some committing to buy up to $400 million worth of shares, representing nearly two-thirds of the total proceeds. Notable investors in this group include Norges Bank Investment Management, TCV, Sequoia Capital, D1 Capital Partners, and Valiant Capital Management. PepsiCo also agreed to purchase $175 million in preferred convertible stock.

The successful pricing of Instacart's IPO signals a positive turnaround in the U.S. IPO market, driven by investor appetite and strong demand for tech-related offerings.