Zepto, a Mumbai-based quick-commerce startup, has secured $350 million in a new funding round led by Motilal Oswal’s private wealth division. This latest investment brings Zepto’s total funding to over $1.3 billion in the past five months, maintaining its valuation at $5 billion. The funding round saw participation from Indian family offices, wealthy individuals, and asset manager Motilal Oswal.
Notable backers include Motilal co-founder Raamdeo Agrawal, the family offices of Mankind Pharma, RP-Sanjiv Goenka, Cello, Haldiram’s, Sekhsaria, and Kalyan, as well as celebrities Amitabh Bachchan and Sachin Tendulkar. Zepto’s aggressive fundraising comes as the startup seeks to increase its domestic investor base, with foreign ownership currently exceeding two-thirds of the company. The quick-commerce market in India is projected to surpass $6 billion this year, with Morgan Stanley forecasting it could reach $42 billion by 2030, representing 18.4% of total e-commerce and 2.5% of retail sales.
Despite the rapid growth of quick-commerce, Zepto’s cash burn has crossed ₹250 crore per month over the past two months, up from ₹35-40 crore in May. CEO Aadit Palicha attributed the increased burn rate to investments in operations, digital marketing, and hiring.
Zepto’s latest investment details
Zepto’s aggressive spending strategy includes substantial outlays on digital marketing, buying keywords, and offering significant discounts to attract customers. The company reportedly spends close to ₹120 crore a month on digital marketing alone. The startup’s rapid expansion has put pressure on established players such as Flipkart, Myntra, and Nykaa, who are losing business to specialized delivery apps.
However, the fast growth of quick-commerce has also negatively impacted mom-and-pop shops across India, with around 200,000 neighborhood stores closing in the past year. Zepto, which handles over 7 million orders daily across more than 17 cities, is on track to record annualized sales of $2 billion. The company projects 150% growth over the next 12 months and plans to go public in India next year.
Despite regulatory challenges on the horizon, Zepto continues to push forward, aiming to reshape the retail landscape in India with its quick-commerce model. The startup’s latest funding round, the largest ever 100% domestic financing round for a private startup in Indian history, positions Zepto on a strong financial footing to reinforce its market position and expand its upper hand in the competitive quick-commerce sector.
