Instacart is an innovative company transforming the landscape of grocery shopping in the United States and Canada, offering a user-friendly online platform for grocery delivery and pickup services. Its core value proposition lies in the convenience it provides consumers, eliminating the need for physical grocery store visits. With technology-driven business models such as Instacart’s, the online grocery sector has experienced exponential growth over the last decade, with Instacart alone commanding a roughly $12 billion valuation as of early 2023. For savvy investors eager to capitalize on this promising sector, Instacart’s potential may be appealing. However, it’s vital to note that as of 2023, Instacart remains privately held, thus constraining direct investment opportunities for the public. However, per Instacart’s Form-S1 filing in May of last year, the company has outlined plans to go public.
Can You Buy Instacart Stock? Is Instacart Publicly Traded?
- Instacart operates as a private company, so its shares are not available for purchase on public stock exchanges like NYSE or NASDAQ.
- Private companies like Instacart raise capital through private funding rounds, often limited to accredited or institutional investors.
- As a privately held company, Instacart is not subject to the same disclosure requirements as public companies.
- Publicly traded companies are obligated to regularly disclose financial information through annual reports (10-Ks), quarterly reports (10-Qs), and major event notifications (8-Ks).
- This financial information is important for investors to make informed decisions about the company’s financial health, operational performance, and strategic direction.
While Instacart may share some financial highlights or milestones, there is no legal requirement for it to divulge detailed financial statements or disclose operational specifics regularly. This scarcity of information can make it challenging for potential investors to fully understand the company’s financial health and future prospects, forming another significant hurdle in the investment process.
Who Owns Instacart?
- Instacart was founded in 2012 by Apoorva Mehta, Max Mullen, and Brandon Leonardo.
- The founders, along with a diverse group of reputable investors, retain the primary ownership of Instacart.
- The significant capital collectively invested by the founders and investors has fueled the company’s growth and expansion initiatives.
- Ownership and investment patterns play a crucial role in influencing a company’s future trajectory.
- Instacart’s robust financial backing indicates a high level of confidence in the company’s future potential.
Beyond its founders, Instacart operates under the control of a board of directors and is part of the parent company, Maplebear Inc. Its current CEO, Fidji Simo, oversees the strategic direction and operational management of the company. As a testament to its growth, Instacart attracted a whopping 9.6 million users in 2020 alone. Looking forward, there are plans for the company to transition from a privately held entity to a publicly-traded one, highlighting the ongoing evolution of this pioneering grocery delivery service.
Is Instacart’s Parent Company Publicly Traded?
As previously mentioned, Instacart is a subsidiary of its parent company, Maplebear Inc., a holding company that acts as a safeguard to limit liability and presides over several small companies under its umbrella, which include Ridley’s Family Markets, Shop United, Shop Cash Saver, and Homeland Grocery Delivery. Like Instacart, Maplebear Inc., is not publicly traded.
Instacart was the inaugural venture of Maplebear, both companies launching concurrently in June 2012. Moreover, despite being under the umbrella of Maplebear Inc., Instacart operates with a high degree of autonomy. Unlike many startups, Instacart functions as a standalone entity, seemingly unencumbered by the influences of its parent company. Nevertheless, this operational structure precludes the possibility for potential investors to indirectly acquire a stake in Instacart through Maplebear, further highlighting the need to explore alternative investment opportunities in the online grocery and delivery sector.
How to Invest in Instacart Stock
- Currently, there is no separate Instacart stock available for purchase.
- Instacart’s parent company, Maplebear Inc., is also private, preventing direct or indirect investment as a retail investor.
- Instacart has raised funds through multiple rounds of venture capital funding.
- The possibility of Instacart going public is uncertain.
- Buying shares in venture capital firms that have invested in Instacart could provide exposure to the company’s potential success.
- Investors can consider other publicly traded companies like Amazon, Walmart, and Ocado for investment opportunities in the grocery delivery sector.
- Amazon, with its subsidiary Whole Foods, and Walmart, the world’s largest retailer, offer reasonable investment opportunities in the grocery industry.
- Ocado, a UK-based company, is a pioneer in online grocery retailing and is publicly traded.
- Companies like Shopify and Adobe, which focus on technological advancements and improving the customer’s online shopping experience, are also highly rated investment options.
How to Buy the Instacart IPO
Speculation around an Initial Public Offering (IPO) from Instacart has been circulating since the company filed for an IPO confidentially in May 2022. Analysts initially anticipated a late 2022 IPO date; however, due to market volatility, these plans have been postponed, as reported by the New York Times. Nevertheless, Instacart hasn’t withdrawn its filing and is said to be waiting for more favorable market conditions to go public. The company has also enlisted Goldman Sachs as its underwriter. To partake in this opportunity and purchase Instacart shares during the IPO, investors will need an active brokerage account. The investors would then express their interest for shares during the IPO phase, and subsequently, wait for the allocation of these shares before they are publicly traded.
Buying Instacart stock post-IPO involves three key steps.
- The first step is to select a brokerage service and set up an account based on your investing goals.
- Depositing funds into your account is the second step, considering that different brokers have varying access and waiting periods.
- The final step is to search for Instacart and purchase the shares once the company successfully completes its IPO.
- Instacart has chosen Goldman Sachs to lead the IPO effort, and the debut on the public markets is expected in early 2021, although the precise date hasn’t been confirmed yet.
Instacart Stock Price Chart
Instacart, a private company, lacks a publicly available stock price chart for tracking its share performance. Nevertheless, its valuation trajectory as a private entity has been remarkable, reaching an impressive $39 billion in 2021. Any fluctuations in its private valuation could provide valuable insights into the potential stock price if Instacart were to go public.
In late February, Instacart experienced an 18% increase in its internal stock price compared to December. This adjustment took into account the company’s financial results from December, January, and February, as well as the stock performance of similar publicly traded technology companies. As a result, the new stock price suggests a valuation of approximately $12 billion, representing an increase from the previous valuation of around $10 billion. These adjustments provide further indications of Instacart’s growth and market potential, potentially influencing its potential stock price in the future if the company decides to enter the public market.
Instacart’s Future Projections
Given its steep trajectory in the e-commerce industry, many analysts believe Instacart’s future to be bright. Its rapid user base expansion, partnerships with several leading grocery chains, and widespread availability across the U.S and Canada have contributed to its increasing market dominance. Furthermore, with an increase in online grocery shopping trends, the market potential for Instacart’s services appears vast.
In terms of financials, while the company is not mandated to disclose its earnings, some reports suggest Instacart’s gross merchandise volume (GMV) crossed $35 billion in 2020, marking a 300% year-over-year growth. With such high revenue growth and an expanding market, the company’s profitability outlook seems strong. However, as with any investment, there are potential risks. Market competition, regulation changes, and profitability concerns are some of the issues that could potentially affect Instacart’s future growth.
Potential Risks for Investing in Instacart
While the prospects of investing in a high-growth company like Instacart may be attractive, potential investors should be aware of the associated risks. One primary risk lies in its intense competition. Online grocery delivery is a burgeoning market, and Instacart faces competition from retail behemoths such as Amazon, Walmart, and Target. These competitors not only have significant resources but also possess their own grocery chains, which could allow them to offer similar services at lower prices.
Additionally, while the COVID pandemic fueled a significant surge in demand for Instacart’s services, it’s uncertain if this trend will continue as shoppers gradually return to normalcy. The company’s ability to retain its customers and keep up its growth rate post-pandemic will be crucial to its success. Finally, Instacart’s profitability is a significant concern. Despite its high revenue growth, the company has reportedly not turned a profit since its inception due to its high operational costs. For Instacart to prove a profitable investment in the long term, it will need to find a way to translate its revenue growth into net income.
Alternative Investment Options
Given the current unavailability of Instacart’s public shares, investors seeking exposure to the online grocery delivery market may consider alternative investments. Investing in companies with strong online grocery delivery operations such as Amazon (AMZN), Walmart (WMT), or Target (TGT) is one such option.
- Consider investing in exchange-traded funds (ETFs) focused on e-commerce or the technology sector for broader exposure to the industry.
- Some ETFs to consider include the Global X E-commerce ETF (EBIZ), the Amplify Online Retail ETF (IBUY), or the ProShares Online Retail ETF (ONLN).
- Conduct thorough research and consult with a financial advisor before making any investment decisions.
Instacart’s growth trajectory and dominant position in the online grocery market make it an attractive investment opportunity. However, as a private entity, direct public investment is not currently possible. Instacart’s potential transition to a publicly-traded company could provide investors a chance to partake in its promising future. Investors should closely monitor developments, including the much-anticipated IPO, and prepare to participate through an active brokerage account.
That being said, alternative investment avenues such as investing in competitors like Amazon, Walmart, and Target, or relevant ETFs, may offer exposure to the online grocery sector. While the prospects are enticing, investors must evaluate risks, including market competition, potential post-pandemic shifts, and profitability concerns. Understanding these dynamics in the context of individual investment goals, the broader market environment, and with expert advice is crucial in making informed investment decisions.
Instacart is an American company that offers a platform for grocery delivery and pick-up services in the United States and Canada. The company operates through partnerships with several major retail stores to deliver goods to customers within as little as an hour.
As of the present time, Instacart is a privately owned company, which means its shares are not available for purchase on public stock exchanges. Therefore, direct investment in Instacart is not currently possible for most individuals.
Instacart is owned by its founders, Apoorva Mehta, Max Mullen, and Brandon Leonardo. It also has the backing of several high-profile investors who have invested heavily in the company’s growth over the years.
There is ongoing speculation about a possible Initial Public Offering (IPO) from Instacart. If this were to occur, it would present a significant investment opportunity. However, as of now, no definitive timeline or plans for an IPO have been announced by the company.
While direct investment in Instacart is not currently possible due to its private status, there are several other companies in the grocery delivery and e-commerce sector that are publicly traded, such as Amazon and Walmart. These companies can offer alternative investment opportunities in this industry. As always, any investment decisions should be made in consultation with a financial advisor, taking into account your personal investment goals and risk tolerance.
StockHax strives to provide unbiased and reliable information on cryptocurrency, finance, trading, and stocks. However, we cannot provide financial advice and urge users to do their own research and due diligence.Read More