Swiggy $700 million has been earmarked for instamart service, amid rising investor interest and increasing competition instant grocery Distribution Division, Co-Founder and Chief Executive Officer Sriharsha Majety said.

instamart,
Launched in August last year Swiggy’s Quick Commerce vertical is set to reach an annual GMV run rate of $1 billion over the next three quarters, the company said. Gross Merchandise Value, or GMV, is a key online retail sales metric for the total value of goods sold through a marketplace.

However, there is no set time frame for the deployment of the cache as it is an overall commitment to the category, Majety told ET. “It is not a dated commitment where we are going to deploy it in the next 12 months or 18 months. We feel we need to deploy the size of ammunition to be able to do justice to this category,” he said.

The delivery platform, which is a Zomato-backed . competes with Grofers, Mumbai-based Zepto and Tata’s bigbasket In the accelerated commerce category, receiving over one million grocery orders per week and running 150 dark stores across 18 cities. It will add 100 more of these so-called dark stores over the next few months.

Grofers, who is
Chances of receiving $500 million capital from

, which operates a network of 200 dark stores, to which it plans to add another 100, the company announced in a blogpost in November. Zepto, a pure-play quick commerce platform
Recently raised $60 million, is targeting 100 dark stores by the end of the year.

Swiggy’s big capital commitment to Instamart comes after talks with the Bengaluru-based company
To close a $600-700 million funding round Led by US asset manager Invesco, ET first reported on Sept. 28. The fundraising, which is likely to value the firm at more than $10 billion, is part of a re-rating exercise that will double the company’s valuation after rival.
Zomato’s bumper IPO,

“This is an exciting category and our commitment to investing is a function of that. Every time there is a new category that starts to explode or opens up – whether globally or locally – there is always going to be interest and there will be some funding going on along the way,” Mazetti said of the flood of investments in Ultra- Fast delivery location.

He added that Swiggy’s delivery platform coupled with its existing facility-seeking user base gives it a competitive edge. “The platform advantage is an obvious one. Our user acquisition costs are much lower than any standalone company trying to acquire fresh consumers. As you’ve seen with any multi-category app, Where users transacting on two categories actually grow their business in both categories, when there is more engagement, the whole wheel of multi-category commerce is real.”

Instamart, which aims to deliver groceries in 15-30 minutes through a network of seller-owned dark stores, emerged from the learnings of Swiggy Stores, a hyperlocal delivery marketplace for groceries and other essentials that Closed earlier this year. What has changed at Instamart started as an experiment a few years back and is now the second biggest revenue driver for the food delivery platform.

Majetti said the company will continue to strengthen its multi-class convenience game.

Food delivery still the focus

Mazzetti told ET that despite Swiggy moving aggressively on the grocery delivery front, the company’s food-delivery business hit an annual GMV run rate of $3 billion, a lifetime high for the category . The company’s food delivery volumes have exceeded pre-pandemic levels, he said, without getting into specifics.

“The food delivery platform is the mothership that drives every other new business that we run and we are very focused on that. I spend most of my time focusing on food delivery,” said Majetti, when asked if Swiggy’s focus has shifted away from its core business. “Overall the growth for the category has been very strong as user spend per month transacting is 50% higher than pre-Covid-19 levels.”

2021 has been an exceptional year for consumer internet startups like Zomato, Nykaa and Policybazaar, which have tapped the public markets and delivered bumper returns to private investors. Majetti said that from an IPO preparation standpoint, things are a long way off and the company will explore listing as more clarity “emerges on our investment calendar”.

“I think we are definitely watching everything closely. With more information and clarity coming on our own investment calendar, we will definitely explore opportunities,” he said.

Swiggy is also running pilots for several services, classified as “Horizon Three” which are in an experimental stage. One of them is a meat market, and a pickup and delivery service under a separate subscription-based platform Genie
super daily Which he achieved in 2018. of swiggy
Newly Advanced Co-Founder Phani Kishan He is looking after that business.

“We are continuing to explore wanderlust, fixing tweaks to the business model, before I feel comfortable enough to have a Go jet set on some of these trips. So I think those are three horizons and, as a company, We should always be serious about all three horizons.”

Both Swiggy and Zomato have taken a beating in recent months.
The backlash from gig workers faced The alleged poor pay, lack of compensation for skyrocketing petrol prices, lack of first-mile pay, lack of long-distance return bonus and daily earnings limits, ET reported in August. Swiggy’s delivery partners led the protests in September last year after the company cut salaries as it first absorbed the after-effects of the lockdown.

“We feel comfortable about how the earnings are going, we are doing our best. But other than that, I think a lot of inconveniences are being caused to us in the form of feedback,” Majeti. “This is something that we have to figure out for delivery partners along the journey to make work easier. And that journey started long ago now. It’s a constant work in progress.”