Zepto raises $450 million at $7 billion valuation as Indian quick commerce market heats up

Zepto, the Indian quick commerce startup, has successfully raised $400 million in its latest funding round, led by the California Public Employees’ Retirement System (CalPERS), a prominent U.S.-based pension fund. This funding round combines both primary and secondary investments and includes contributions from existing investors such as Avenir, Avra, Lightspeed, Glade Brook, The Stepstone Group, and Nexus Venture Partners. Following this significant capital influx, Zepto is setting its sights on going public next year, intensifying its competition with other players in the quick commerce arena, including BlinkIt, Swiggy Instamart, and Tata’s BigBasket — all of which are part of publicly traded companies. The startup has been actively securing funding, amassing a staggering $1.3 billion over several months last year. Since Zepto’s last funding round in November 2024, the competitive landscape has evolved, with Swiggy making its debut on India’s stock exchange and BlinkIt surpassing Zomato in gross order value for the first quarter of 2025. Additionally, traditional e-commerce giants like Flipkart and Amazon have also ventured into quick commerce delivery, heightening the competition. The quick commerce market in India shows promising signs of growth, with Morgan Stanley projecting it could reach a remarkable $42 billion by 2030, while Bernstein estimates it could soar to $100 billion within a decade. Zepto’s CEO, Aadit Palicha, remains optimistic about the startup’s trajectory, noting that daily orders have surged from 500,000 five quarters ago to an impressive 1.7 million. Despite facing challenges, including the suspension of its Zepto Cafe service in 44 cities due to staffing issues, the startup is focused on expanding its reach in major Indian cities. J.P. Morgan recently highlighted that BlinkIt operates over 204 dark stores for fulfilling online orders, while Swiggy Instamart services more than 104 cities, and Zepto covers over 80. CalPERS' investment marks a significant move, as the pension fund typically engages in venture capital through intermediary funds rather than directly investing in startups. Since 2022, CalPERS has been ramping up its venture investments to recover from a previous period of underperformance. This decision to lead a funding round for an Indian quick-commerce startup reflects a strong institutional confidence in the rapid delivery sector and potentially indicates CalPERS' growing interest in direct investments within emerging markets.