Instacart today disclosed that it hopes to raise up to $616 million in its upcoming initial public offering.

The grocery delivery company, which is incorporated as Maplebear Inc., detailed its fundraising target in an update to its IPO prospectus. Instacart  filed the initial version of the document on Aug. 25. The same week, Arm Holdings plc and marketing software maker Klaviyo Inc. submitted the paperwork for their own stock market listings. 

Instacart plans to make up to 22 million shares available to investors at a price of between $26 and $28 apiece. The company will issue 14.1 million of those shares, while the remainder is set to be offered by existing shareholders. The stock will fetch up to $616 million on the high end of Instacart’s price target.

A group of investors has already expressed interest in buying $400 million worth of shares. The consortium includes an affiliate of Norway’s central bank, TCV, Sequoia Capital, D1 Capital Partners and Valiant Capital Management. Separately from the IPO, PepsiCo Inc. plans to buy $150 million worth of Instacart shares through a private placement.

The offering is expected to value the company at between $8.6 billion and $9.3 billion.

San Francisco-based Instacart operates a popular food delivery platform of the same name. The platform, which is available on the web and via an app, enables consumers to order food from 80,000 stores operated by 1,400-plus retailers. Delivery times range between 15 minutes and a few days depending on the purchase.

According to Instacart’s IPO filing, the company processed $29.4 billion worth of grocery orders in the 12 months ended June 30. From 2018 to 2022, the value of the merchandise purchased through its platform increased at a compound annual growth rate of 80%. The company says the broader online grocery market achieved a CAGR of 50% in the same time frame.

Instacart is profitable. It generated net income of $242 million during the six months ended June 30, a significant improvement over the $74 million loss it had logged a year earlier. The company’s sales grew 31%, to $1.12 billion, in the same time frame.

The company generates revenue from not only grocery deliveries but also a set of software products it sells to other companies. Instacart Enterprise Platform is a toolkit that retailers can use to power their e-commerce stores. The grocery delivery provider also offers analytics software for tracking customer demand, as well as an advertising tool that allows brands to promote their merchandise through its platform’s interface.

To maintain its revenue growth following the IPO, Instacart is also investing in emerging technologies. 

The company introduced an offering called Connected Stores last year that aims to help retailers optimize their store operations. The offering includes, among other components, a smart shopping cart that allows consumers to skip the checkout line. The cart uses sensors to identify what items it carries and provides a built-in payment terminal for completing the purchase.

Instacart will go public on the Nasdaq under the ticker symbol “CART.” The IPO is expected to take place later this month. 

Image: Instacart