Ahead of its latest funding round, early investors in Zepto are witnessing remarkable returns, reaching as high as 6,000% in secondary markets.

Ahead of its latest funding round, early investors in Zepto are witnessing remarkable returns, reaching as high as 6,000% in secondary markets.

As Zepto prepares to become India’s first unicorn of 2023, select early backers are being offered secondary exits to create space on its capitalization table. Zepto, a quick commerce platform, is on track to join the unicorn club if its latest funding efforts prove successful. The startup, backed by Y Combinator, is reportedly in discussions

As Zepto prepares to become India’s first unicorn of 2023, select early backers are being offered secondary exits to create space on its capitalization table.

Zepto, a quick commerce platform, is on track to join the unicorn club if its latest funding efforts prove successful. The startup, backed by Y Combinator, is reportedly in discussions to raise approximately $150 million from StepStone group, as well as existing investors Nexus Ventures and Gladebrook Capital. This latest fundraising round, as reported by Inc42, would value Zepto at around $1.3 billion.

The funding is crucial for Zepto as it faces competition from rivals Swiggy’s Instamart and Zomato-owned Blinkit, with the three companies collectively dominating around 80% of the quick commerce market in India. Meanwhile, Zepto is offering exits to a select group of early investors, allowing them to sell shares worth $9.6 million in a secondary transaction, according to regulatory documents obtained by The CapTable.

Eleven investors, including notable names such as Jim Breyer (former Managing Partner at Accel), Mohandass Kalaichelvan (Founder of SaaS player Spenmo), Nilam Ganenthiran (former President of Instacart), and Ravi Inukonda (Chief Financial Officer of US-based foodtech player DoorDash), are transferring their shares to a special-purpose vehicle as part of this transaction.

These investors had acquired stakes in Zepto through various equity rounds between January 2021 and May 2022. Some of these early investors are expected to earn returns as high as 6,000% on their initial investments through this secondary exit. For example, New York-based investor Jacob Honig, who invested $50,000 in Zepto in early 2021, is transferring his entire stake and is projected to make around $3.1 million.

While Zepto has yet to allocate fresh shares to its incoming investors, the holdings of its early backers, including Oliver Jung and Global Founders Capital, have increased in value by over 200% through the startup’s successive funding rounds over the past two years. The forthcoming capital infusion will play a significant role in Zepto’s aim to achieve profitability by 2024.

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