The Zepto Brothers
BACKGROUND OF THE BROTHERS
Aadit Palicha
Born and brought up in Dubai. Aadit Palich belongs to Mumbai and
he went to Stanford to pursue a degree in computer engineering in
2020 owing to the pandemic to pursue his interest in his startup he
decided to take a drop year before quitting his first venture with his
childhood friend K.V. (Kaivalya Vohra) and launched KiranaKart and
latter Zepto. For the unversed, Zepto is not Aadit Palich’s first
entrepreneurial venture – When he was just 17, he launched GoPool.
He is also the man behind the AI project PryvaSee.
Kaivalya Vohra
Kaivalya Vohra was born on 15 March 2003 in Bengaluru, Karnataka.
Vohra has done his schooling from Bengaluru and he knows three
languages, Hindi, English, and French.Kaivalya Vohra, Zepto’s chief
technology officer, also went to Stanford University to pursue a
degree in computer engineering, but just like Aadit Palich, he also
realized his potential and decided to start Zepto. The two made it to
the Hurun Indis’s. Future Unicorn Index 2022 list. Kaivalya Vohra
was at 1,036th spot in the IIFL Wealth Hurun India Rich List 2022,
with a net worth of Rs 1,000 crore.
EARLY VENTURES
Brought up in Dubai and from families that had a background in
business, they dabbled with ventures early on. While in school they
started up their first venture GoPool, a ride-pooling app that was
acquired by a Dubai-based firm. Inspired by the stories of unicorns
(startups valued at a billion dollars and above) coming from India,
they came to Mumbai to try their luck with entrepreneurship for the
second time. This was also around the time when pandemic-induced
nationwide lockdowns made it hard to arrange for essentials. They
decided to start a venture that would solve this problem - initially by
partnering with local offline shops or kiranas to deliver essentials.
However, they soon realized that quick delivery is hard to execute
without dedicated dark stores (mini-warehouses). So, they shut
KiranaKart and set up Zepto. Kaivalya Vohra and Aadit co-founded
Zepto, which is part of Kiranakart Technologies Private Limited. The
company now delivers in Delhi, Chennai, Gurgaon, Bengaluru and
Mumbai
HISTORY
CEO Palicha started Zepto with CTO Vohra in 2020 when they were
17 years old. They previously built a ride-hailing service in Dubai
together which was acquired by a local firm Palicha and Vohra
decided to skip college, instead raising their first external capital from
Contrary (venture capital firm), which offered to invest in the duo in
lieu of attending the Stanford University.
Inspired by the stories of unicorns (startups valued at a billion dollars
and above) coming from India, they came to Mumbai to try their luck
with entrepreneurship for the second time. This was also around the
time when pandemic-induced nationwide lockdowns made it hard to
arrange for basic essentials. Palicha and Vohra originally branded
their company KiranaKart and focused on facilitating grocery delivery
by partnering with local kiranas, but that approach did not gain
traction.
BACKGROUND
In 2021, it collaborated with 86 dark store owners in thirteen
different places, resulting in more than one million deliveries.
Zepto company uses its network of ‘cloud shops’ or microwarehouses to fulfil orders quickly. The company, which utilises
the term “Zepto” to represent “a factor of 1021, i.e.
0.000000000000000000001,” is called after a minuscule unit
of time, and it provides a 10-minute grocery delivery service,
outperforming several well-funded competitors.
Zepto’s tagline is, “Groceries delivered in 10 minutes.”
Zepto’s secret is its ability to regularly generate 2,500+ items
for delivery in under 10 minutes. It’s at the centre of everything
the firm does, and it’s why they’ve been able to grow so swiftly
while retaining such high levels of client loyalty. They also
participated in Y Combinator’s accelerator program while building out
the first version of their app. In 2021, verticalized their operation,
building a network of Dark stores that can deliver to local customers
in under 10 minutes on average. Throughout the following 18
months, Zepto raised over $360 million across 4 fundraising rounds
and created over 100 operational hubs across India. In April 2022,
Zepto launched Cafe, an additional service focused on delivery of
coffee and ready-to-eat food
The grocery delivery industry is seeking to capitalise on quick
commerce as the next big thing. Fast-delivery startups like
Zepto in India and Fridge No More in New York City are among
the fastest-growing in the industry.
BECOMING A UNICORN
Zepto is an Indian q-commerce (Q-commerce, which is also known
as rapid commerce, is a subcategory of e-commerce in which the emphasis is
placed on making deliveries as quickly as possible, generally in less than an hour. Qcommerce had its start in the delivery of food, and to this day, that service still
accounts for the majority of the company's revenue. It has rapidly grown into other
areas, including the delivery of groceries, pharmaceuticals, presents, fashion, and
other goods, among other things. Meituan, Gojek, Grab, Delivery Hero, Glovo,
Rappi, GoPuff, Instacart, and Postmates are all examples of businesses that
participate in q-commerce.) Founded in 2020 and launched in July
2021, Zepto became well-known as one of the fastest-growing
technology startups in Indian history.
Zepto – Funding and Investors
The funding frenzy in start-ups has scaled a new high with 10-minute
grocery delivery firm Zepto raising $60 million from US-based growth
equity funds Glade Brook Capital, Nexus Venture Partners and Y
Combinator. Nilam Ganenthiran, the President of Instacart, and Ravi
Inukonda, a senior executive at DoorDash, also participated in the
round. The funding round - one of Zepto’s earliest rounds – also saw
participation from individual investors like Lachy Groom, Neeraj
Arora and Manik Gupta, valuing the company at $225 million.
The company used this money to expand operations across the
country and beef up its human capital. The company, which was in a
beta mode for the last six months across Delhi, Mumbai, and
Bangalore, is expanding fast and plans to reach out to key areas
across Hyderabad, Chennai, Pune, and Kolkata. Zepto aimed to
achieve a 900-strong corporate team in a couple of months from 300
then.
The company has raised approximately $350 million and was
valued at $560 million in April-December 2021.
Aadit Palicha, chief executive officer (CEO) and co-founder of
Zepto company, stated that the company’s revenue has
increased by 800 per cent every quarter. Second, the company’s
cash burn has decreased by a fifth on a pre-order basis. He also
mentioned that the company claims to have an 88-point Net
Promoter Score (NPS), which is a number that corporations use
to assess client loyalty.
He stated that the company has hired 1000 workers across all
functions in the last few months and aims to hire another 1000
in the coming year. Engineering, analytics, operations,
marketing, finance, and human resources were all targeted in
the first wave of hiring (HR). The second phase would be devoted
to technology and product development.
Since the second half of 2021, competition in the rapid
commerce market has expanded dramatically. Dunzo,
Swiggy Instamart, Zomato-backed Blinkit (Grofers), and
now Tata-backed BigBazaar compete with Zepto.
In India, a $1 trillion retail industry where grocery
purchases account for the vast bulk of consumer
expenditure, e-grocery delivery is gaining steam. The
Indian e-grocery market was valued at $2.9 billion in
2020, and from 2021 to 2028, it is predicted to grow at a
37.1 per cent annual pace.
To date, Zepto has raised $360 million in four fundraising
rounds. Zepto’s most recent investment round (Series D) was
on May 2, 2022, and it helped the firm raise $200 million.
GROWTH
Zepto will expand into Bengaluru, Mumbai, and Delhi-NCR in
the following months, with Hyderabad, Chennai, Pune, and
Kolkata to follow. It has a technical office in Bengaluru and
operations in Mumbai. Zepto company has hired senior
executives from Dream11, Flipkart, Pharmeasy, Uber, and
Pepperfry.
Zepto had a valuation of $570 million when it was a fivemonth-old firm after obtaining $100 million in a Series C round
led by Y Combinator’s Continuity Fund, which was a twice
increase from its last valuation $60 million only 45 days before.
Zepto has raised another round of funding spearheaded by Y
Combinator, bringing its total valuation to $900 million.
Another encouraging development for Zepto has been the
knowledge it has gained in recent months. Senior executives
from Uber, Flipkart, Amazon, and Pharmeasy have joined the
company.
Zepto – Competitors
Many businesses compete with Zepto and have already been
driving fast-paced delivery of groceries like: Many companies
compete with Zepto and have already pioneered fast-paced
grocery delivery, including:
• Swiggy Instamart
• Big Basket
• Blinkit
Swiggy and Big Basket have already started delivering goods in
10-15 minutes, while Blinkit is preparing to launch 10-minute
food deliveries in 10 cities, competing with Zepto. Dunzo is a
competitor to Zepto since it uses its Xpress Mart dark store
network to deliver groceries in Bengaluru in 19 minutes.