Zepto might become the first unicorn of 2023

Amid a litany of woes that marks the once-hallowed world of unicorns, Zepto, the Mumbai-based quick commerce delivery platform, is promising to emerge as India’s first unicorn this year as it is poised to tie up fresh funding that could send its valuation soaring to $1.3 billion – well past the $1 billion eligibility mark to be recognised as a unicorn.

The Business Standard has reported that the company is about to raise $150 million in series E funding. The series E funding is a crucial one since it usually takes place before a company goes for an IPO.

This round of funding comes a long gap after funding for Indian startups and indeed elsewhere too ran dry. The years 2021 and 2022 were the heydays for unicorns when as many as 67 startups turned unicorns in the country – 44 in 2021 and 25 in 2022. The flood of unicorns started turning into a trickle in the second half of 2022 when only six unicorns were reported compared to 19 in the first half.

Zepto operates in the quick commerce domain, the demand for which shot up during the pandemic when people depended on these for delivery of sundry items. It promised delivery in 10 minutes.

Zepto is a close competitor of Swiggy Instamart and Blinkit that happens to be backed the other biggie in the domain Zomato.

According to the report, this round of funding will be anchored by StepStone Group which is a limited partner of Nexus Venture Partners, an existing investor of Zepto.

The other companies that are backing Zepto include Combinator, Kaizer Permanente and Glade Brook Capital.

However, Zepto’s bottom line is awash with red. It suffered a standalone loss of Rs 390.3 crore in 2021-22 on a revenue of Rs 142.3 crore while it expenses zoomed to Rs 532.7 crore.

The company was set up by Palicha and Kaivalya Vohra in 2021.

Zepto raised $60 million in October 2021 and $100 in December of the same year. IN May 2022, it raised a further $200 million. It is now valued at $900 million.