Instacart Competitors: Who’s Leading The Grocery Delivery Race?

Instacart is an on-demand delivery service that enables customers to order groceries from supermarkets and other stores nearby. The deliveries are then executed by the firm’s ‘Shoppers’ who work for the firm on a contractual basis.

The company, which is headquartered in San Francisco, California, was founded in 2012 by Apoorva Mehta, Brandon Leonardo, and Max Mullen.

Instacart, despite some leadership issues, which led to the departure of its founder and CEO Apoorva Mehta in July 2021, remains one of the leading grocery delivery services in the United States. Today, it accounts for roughly 45 percent of all grocery sales in the country.

The platform works together with grocery chains such as Albertsons, ALDI, Costco, CVS, Kroger, Loblaw, Publix, Sam’s Club, and others. To do that, it taps into a network of more than 100,000 couriers who work together with Instacart on a contractual basis.

In case you’re curious: this is how Instacart makes money

In 2021, Instacart generated around $1.8 billion in revenue. This represents a slight increase from the $1.5 billion it made in 2020. Although the lifting of pandemic measures has caused its valuation to dip from $39 billion to $24 billion, Instacart remains firmly in the driver’s seat to become the undisputed leader in grocery delivery.

Close to 15,000 people are furthermore employed by the company whose iOS app has been reviewed 2.3 million times.

The methodology with which competitors of Instacart are ranked is based on publicly available information. Data points such as the revenue generated, the number of employees, the number of cities served or couriers on the platform, app downloads, and anything else in between will be considered.

This analysis, in order to ensure comparability, only looks at competitors in the grocery delivery space. Additionally, since Instacart solely operates in the United States and Canada, only services from these countries will be taken into account.

Lastly, this analysis does not include indirect competitors of Instacart. Examples would be supermarkets, grocery chains, or meal-kit services such as HelloFresh.

So, without further ado, let’s take a closer look at the top 12 competitors as well as the competitive advantage of Instacart.

1. Walmart Grocery

Headquarters: Bentonville, Arkansas, United States

Founder(s): Sam Walton

Year Founded: 1962

When the world’s biggest grocery chain decided to enter the delivery space, it undoubtedly is slated to automatically become one of the key players in the industry. In fact, Walmart is currently the leading grocery delivery service in the United States with a market share of around 48 percent.

Customers can either pick up their order in one of its 4,700+ stores or have it delivered by local, third-party drivers.

Walmart initially launched the service back in 2019 in Kansas City, Pittsburgh, and Vero Beach, Florida. After a successful test phase, it has since expanded across North America and aims to reach 30 million households by the end of 2022.

The service, which is called InHome, costs $19.95 per month (or $148 / year). Apart from groceries, Walmart also delivers pharmaceutical products and conducts repairs. Walmart even delivers when the customer isn’t at home by utilizing a camera that employees wear and use to record the successful delivery.

Sources: CNBC, Walmart

2. Shipt

Headquarters: Birmingham, Alabama, United States

Founder(s): Bill Smith

Year Founded: 2014

Shipt is probably the closest pure-play grocery delivery competitor to Instacart. Co-founder Smith, an experienced entrepreneur, invested $3 million of his own money to get the business off the ground. He eventually pivoted towards grocery delivery in early 2015 – and hasn’t looked back since.

Today, Shipt works together with 120+ retailers to deliver groceries to consumers across the United States. It counts the nation’s leading chains including Costco, CVS, Walgreens, Petco, Sephora, and more as partners. It’s the third most popular service in the U.S., accounting for around 6 percent of all grocery delivery sales.

Within three years of being founded, the company managed to grow to hundreds of cities served. This led Target to acquire the business for $550 million in December 2017. Previously, Shipt had raised $65.2 million in venture funding.

Today, the service is available in 5,000+ cities and is thus able to cover 80 percent of households nationwide. Those households are served by the more than 300,000 ‘Shoppers’ that work for Shipt on a contractual basis.

Sources: Crunchbase, Shipt

3. FreshDirect

Headquarters: Long Island City, New York, United States

Founder(s): David McInerney, Jason Ackerman, Joe Fedele

Year Founded: 1998

FreshDirect is the grocery delivery pioneer on this list. Since 2002, it delivers fresh produce across the greater New York City, Philadelphia, and Washington, DC metropolitan areas. It offers instant (2 hours), same-day, as well as next-day delivery.

Its DeliveryPass plan, which is available at different pricing tiers, furthermore grants customers free deliveries and other benefits. Over 6,000+ different items are available.

In November 2020, Netherlands-based food retailer Ahold Delhaize (together with private equity firm Centerbridge Partners) acquired a controlling stake in FreshDirect for about $300 million. The company employs 3,000+ people and generates around $600 million in annual revenue.

Sources: Crunchbase, FreshDirect, LinkedIn

4. Amazon Fresh

Headquarters: Seattle, Washington, United States

Founder(s): Amazon

Year Founded: 2007

Amazon Fresh is a subsidiary of the online marketplace giant that includes its own set of retail stores (dubbed Amazon Go) as well as grocery delivery. Prime members, for example, can take advantage of free and same-day delivery.

The delivery service is available across 2000+ cities in the U.S. and the U.K., as well as in selected cities such as Berlin, London, Milan, and Tokyo. In some instances, such as the U.K., it works together with local retail chains to source the groceries. Other times, it delivers from Whole Foods stores, which Amazon acquired back in 2017.

Amazon remains particularly secretive about the performance of its Fresh subsidiary. As a result, it has opted against disclosing much data to the public. Nevertheless, given Amazon’s ambition, capital, reach (through Prime), and ability to repeatedly expand into new business lines, it can be assumed that it already is a significant competitor to Instacart.

Additionally, Amazon continues to launch new physical stores, which will further expand its reach and thus the time it takes to deliver.

Sources: Amazon Fresh

5. DoorDash

Headquarters: San Francisco, California, United States

Founder(s): Andy Fang, Evan Moore, Stanley Tang, Tony Xu

Year Founded: 2013

While DoorDash is a force to be reckoned with in the restaurant delivery space, its grocery efforts are still fairly nascent. The company entered the space back in December 2021 by introducing express grocery delivery (in under 30 minutes) in partnership with Albertsons Companies.

Given its extensive track record in food delivery, it can be assumed that it will eventually be able to carve out a significant piece for itself. DashPass members, who pay $9.99 per month, can enjoy free deliveries across their orders.

DoorDash, furthermore, has the capital and human resources to get the service up and running quickly. Over two million couriers already deliver for DoorDash (including both food and groceries). An additional 6,000 people are employed by the company on a full-time basis.

Additionally, DoorDash raised $2.5 billion during its startup life and another $3.4 billion when it went public in December 2020. In 2021 alone, the company generated $4.8 billion in revenue.

Sources: Crunchbase, DoorDash

6. Uber Eats

Headquarters: San Francisco, California, United States

Founder(s): Uber

Year Founded: 2014

Uber Eats is the food delivery subsidiary of the transportation giant Uber. The platform was initially launched UberFRESH and, a year later, renamed to Uber Eats. Uber launched its grocery delivery service during the height of the pandemic in July 2020.

While the Eats business, much like the parent company, has gone through dozens of legal and financial issues in the past, it remains one of the world’s leading food delivery services. Uber Eats is currently available in more than 6,000 cities across 45 countries.

As far as its grocery delivery business is concerned, it has since expanded the service from its testing locations of Miami and Dallas to hundreds across the nation. In July 2021, Uber Eats announced a partnership with Albertsons, which increases its grocery reach to more than 400 cities across the United States.

In 2021, Uber Eats generated $8.3 billion in revenue. The United States naturally remains its strongest market where it accounts for 24 percent of all meal delivery sales (only trailing DoorDash). The service, furthermore, works together with more than 600,000 restaurants. Uber does currently not disclose how much it makes from grocery deliveries.

Sources: Second Measure, Uber

7. Gopuff

Headquarters: Philadelphia, Pennsylvania, United States

Founder(s): Rafael Ilishayev, Yakir Gola

Year Founded: 2013

Gola and Ilishayev were barely above the legal drinking age when they started Gopuff, a grocery delivery service that operates hundreds of micro-fulfillment centers to serve customers within a matter of minutes. Customers can choose from a selection of 4,000 products.

Much like the other services mentioned on this list, Gopuff also offers a membership that grants customers various discounts and other benefits. In many markets, customers can order 24/7.

Gopuff has certainly transformed the grocery delivery industry, which traditionally relied on restaurant partners to supply the items. Gopuff, in spite of its resource-intensive business model (which you can read about here), has managed to expand to 1,000+ cities in the U.S., U.K., and France – with hundreds more to come.

Investors certainly love what they’re seeing as well. They have poured a combined $3.4 billion into the business, which generated $2 billion in revenue in 2021 alone. It is currently valued at $15 billion and employs around 5,000 people.

Sources: Axios, Crunchbase, Gopuff

8. Grubhub

Headquarters: Chicago, Illinois, United States

Founder(s): Jason Finger, Matt Maloney, Mike Evans

Year Founded: 2004

Grubhub is one of the oldest services on this list, having initially started as a restaurant listing site. Those restaurants would then take care of the delivery themselves. In 2015, as a reaction to the pressure that DoorDash and Uber Eats put on its business, Grubhub also entered the food delivery race.

And if that wasn’t enough, it also expanded into grocery delivery. In early 2022, it made two announcements: first, it expanded its partnership with 7-Eleven to offer on-demand convenience delivery from more than 3,000 stores across the nation.

Grubhub also announced a partnership with Russian grocery delivery service Buyk in New York and Chicago. However, after sanctions against Russia, Buyk was forced to terminate the partnership and shut down its business in April 2022.

Grubhub IPO’d back in 2014, which allowed the company to raise $192.5 million (on top of the $84.1 million in equity funding it got before). To remain competitive, it decided to sell itself to Just Eat Takeaway for a whopping $7.3 billion in June 2020.

Within the United States food delivery market, Grubhub has a market share of 14 percent. Grocery delivery numbers are Just Eat Takeaway said that revenues for its North America division, which mostly includes Grubhub, equaled $2.67 billion in 2021.

Grubhub, furthermore, employs around 6,000 people. It counts 320,000 restaurants as partners and is available in 4,000 cities across the United States. Its iOS app was rated 3.5 million times alone.

Sources: App Store, Crunchbase, Just Eat Takeaway, Second Measure

9. Postmates

Headquarters: San Francisco, California, United States

Founder(s): Bastian Lehmann, Sam Street, Sean Plaice

Year Founded: 2011

Postmates started out as a logistics-focused service that would deliver anything from food all the way to electronics such as the iPhone. After Uber acquired the service for $2.7 billion in July 2020, it fully pivoted towards food delivery.

Nevertheless, groceries continue to be an important staple of the firm’s offering. It delivers those groceries from partners such as Walmart and other chains.

Prior to the takeover, Postmates raised $763 million in funding. The company serves over 70 percent of all U.S. households, equating to about 3,500 cities and 500,000 restaurants, grocery and convenience stores, and traditional retailers. Its app has been reviewed 1.8 million times on top of that.

Sources: App Store, Crunchbase, Postmates

10. Misfits Market

Headquarters: Pennsauken, New Jersey, United States

Founder(s): Abhi Ramesh

Year Founded: 2018

Misfits Market is putting a twist on the grocery delivery game by only selling what it labels ‘ugly’ produce. Its founder started the business after visiting a farm and seeing first-hand how much perfectly edible food is being thrown away by farmers because it doesn’t comply with the requirements of traditional grocery chains.

As a result, Misfits Market is able to offer food at discounts of up to 40 percent. On top of that, it helps to combat food loss, which is equal to about 30 to 40 percent of all food supply according to the U.S. Food and Drug Administration (FDA).   

The firm, instead of relying on couriers, works together with UPS to deliver its items on a weekly basis. Investors have supported the fairly young company with over $526 million in funding thus far. Misfits Market is reportedly valued at $2 billion.

Sources: Bloomberg, Misfits Market

11. Imperfect Foods

Headquarters: San Francisco, California, United States

Founder(s): Ben Simon, Benjamin Chesler, Ron Clark

Year Founded: 2015

Another service that tackles the ever-increasing problem of food waste is Imperfect Foods. In fact, it helped save over 145 million pounds of food since it was founded in 2015.

Imperfect Foods currently delivers across most of the West South Central region, Midwest, Northeast, and all along the West Coast. For comparison, Misfits Market is essentially available nationwide across the United States.

The service has been a little more conservative both in its expansion as well as fundraising efforts. Investors have poured in a total of $229.1 million into the company, which is valued at $700 million, thus far. In 2021, the company generated around $500 million in revenue.

Sources: Biz Journals, Crunchbase, Imperfect Foods

12. Getir

Headquarters: Istanbul, Turkey

Founder(s): Arkady Volozh, Mert Salur, Nazım Salur, Serkan Borançılı, Tuncay Tütek

Year Founded: 2015

Getir entered the United States in late 2021 with a similar selling point to Gopuff. It also claims to be able to deliver groceries within 10 minutes. However, unlike its U.S.-based counterpart, Getir doesn’t own the warehouses it ships from. Instead, it works together with local operators who manage the property and staff.  

The company has raised a total of $1.8 billion in venture funding and is currently being valued at an eye-popping $7.55 billion. Over the course of the pandemic, it has expanded from its home country of Turkey all across Europe – and now the United States where it’s slated to cause a dent.

Sources: Crunchbase, Getir

Instacart Competitive Advantage

The competitive advantage of Instacart is grounded in the vastness of its delivery network as well as technological supremacy.

Instacart, as previously stated, is able to tap into a courier network of over 100,000 people. Since it can be seen as a marketplace, one key component of making the model work is having a sufficient supply of couriers.

The more couriers are part of the Instacart platform, the faster it is able to fulfill orders. Additionally, those couriers are consequently not able to fulfill orders for competing platforms, which strengthens Instacart’s positioning.

Another key component of Instacart’s strength of supply is the number of chains it works together with. The platform cooperates with over 300 retailers including ALDI, Costco, CVS, Kroger, Loblaw, Publix, Sam’s Club, Sprouts, and others.

This has translated to tens of thousands of stores that Instacart can tap into, allowing them to offer deliveries across the entire nation. Again, the more choice a customer has, the likelier he or she is to use Instacart over another service such as Walmart.

Another advantage of its ever-increasing retail network is that it strengthens its negotiating power. In fact, many retailers are now reliant on Instacart for delivery-hungry customers as they don’t possess the necessary skills or resources to offer such services themselves.

This is also the exact reason why Target spent $550 million to acquire Shipt back in 2017. It has since extended Shipt’s reach across the country and uses it as an additional selling point to acquire customers.

Apart from its network advantage, Instacart also possesses technological skills that set it apart from the rest of the pack. One of the best indicators of that is its acquisition strategy. In 2021 alone, Instacart purchased a Catering Software-as-a-Service solution (FoodStorm) and an AI-powered retail device maker (Caper).

As a result, Instacart is able to offer additional services that not only increase its revenue but make its core offering more lucrative (since the acquired companies are normally integrated into the core platform).

Additionally, Instacart offers white-label software that has allowed retailers such as Publix, Wegmans, or The Fresh Market to build their own consumer-facing online stores and tap into Instacart’s delivery network.

The company dubs this the Instacart Platform, which is comprised of e-commerce, fulfillment, in-store, as well as advertising solutions. Additionally, partners can get insights into how well their stores and ad campaigns perform.

Hi folks, Viktor checking in! Years of experience in various tech-related roles have led me to start this blog, which I hope provides you with as much enjoyment to read as I have writing the content.