The Stanford University dropouts, Aadit Palicha and Kaivalya Vohra founded Zepto, a 10-minute grocery delivery start-up backed by Y Combinator, as their second venture.
To be fair, most of us have “business ideas” more often than not but successful implementation usually evades the best of us. But 19-year-old Zepto founders Aadit Palicha and Kaivalya Vohra are not from the latter breed. The Stanford University dropouts founded Zepto, a 10-minute grocery delivery start-up backed by Y Combinator, as their second venture. Their first, KiranaKart, had to be wrapped up as they could not find a market fit for its product.
Both Palicha and Vohra had enrolled in Stanford to pursue a Computer Science degree but dropped out to pursue their entrepreneurial interests instead. The idea to start Zepto came from the confines of their homes amid the pandemic. A rise in demand for home-deliveries meant that groceries and other essentials would reach the buyer in a matter of a couple of days, leaving a vacuum for instant delivery. So, Zepto was founded with that consideration in mind.
Their idea found merit among investors as they raised $60 million in a round led by Glade Brook, Nexus, Lachy Groom, Y Combinator and Global Founders Capital earlier this month. Vohra said that once they started their 10-minute delivery, their net promoter score (NPS) shot up. “Simply put, customers love a rapid delivery experience. The data speaks for itself — once we started delivering in 10 minutes, our NPS shot up and has constantly remained at around 85 with a 50%+ week-on-week user retention rate, which shows the incredibly strong customer love for our product,” he explained in a statement.
While a $60 million round is impressive, it is all the more impressive that they founded the company only in April this year. Zepto is reportedly valued at somewhere between $200–300 million currently. Even so, they are not without competition. In fact, the few-months-old company is in competition with giants such as Swiggy, BigBasket, Grofers etc. Grofers, for instance, also promises 10-minute delivery. Swiggy through InstaMart also delivers groceries, essentials and self-care products by 15 minutes.
To prepare for their battle, Zepto has a network of ‘cloud stores’ or micro-warehouses. They are currently able to deliver in parts of Mumbai, Delhi, Bengaluru, Gurugram and Chennai. They are on track to start operations in Hyderabad, Kolkata, and Pune. It has been downloaded over 100k times on Google Play Store. The platform claims to have thousands of items on offer. Zepto also states that it delivers from 7 am to 1 am.
Palicha said after their $60 million-funding, their efforts are now finally paying off. “Today, we’re consistently growing 200 per cent every single month with an unstoppable team, robust product infrastructure, and deep access to institutional capital,” he added in a statement.
While Zepto is what they are grabbing headlines for, Palicha and Vohra’s initial startup KiranaKart did not meet the same fanfare. The idea for Zepto is, however, borrowed from KiranaKart. As the name suggests, KiranaKart too was a grocery delivery platform. It had tied-up with kirana stores to deliver groceries within 45 minutes. It had raised $730,000 in a pre-seed round led by Global Founders Capital , Contrary Capital, 2 AM Ventures, and angel investors. Vohra and Palicha, at that time were aiming to make the first 1.5 lakh deliveries at a delivery cost of Re 1.
The duo zeroed in on grocery delivery for their apps as they found it the most difficult to procure groceries as two bachelors living alone, according to a report in TechCrunch. So, while they aimed to ease grocery delivery for kiranas with KiranaKart, they aim to reduce delivery time with Zepto.
Y Combinator-backed KiranaKart was founded in June, 2020 and closed its shutters in March 2021, following which they started Zepto in April.
