Is Zepto a gold medalist or a bronze medalist?

18 snips

Aug 1, 2024

Explore the meteoric rise of Zepto, a grocery startup making 10-minute deliveries a reality. The hosts discuss how this young company challenged skeptics and traditional retailers alike, redefining consumer habits in India. Dive into the evolution of quick-delivery services, the complexities of Zepto's growth model, and the critical role of common sense in business strategies. Different perspectives on the sustainability of rapid delivery highlight the tensions between consumer demand and venture capital influences in this dynamic market.

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ANECDOTE

Zepto's Early Days

Praveen Gopal Krishnan initially called Zepto a "brosary startup" in his newsletter.
This was because the founders were young and focused on quick deliveries of items like cigarettes, using user tweets as testimonials.

INSIGHT

Zepto's Unexpected Attention

Zepto, despite being smaller than Instamart, receives significant attention from analysts and fund managers.
Seetharaman G noticed this while researching another story and found it puzzling.

ANECDOTE

Arvind Singhal's Zepto Confession

Arvind Singhal admits to being consistently wrong about Zepto's potential until a year ago.
He initially dismissed it as a niche service for impulse purchases, underestimating its potential for habit transformation.

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In 2021, as the pandemic still raged on and we washed our vegetables and supplies before consuming them, a young delivery startup promised that you could get all your groceries – everything you need – delivered right to your doorstep in 10 minutes.

This was pretty crazy back then.

Zepto was written off as an ambitious, overhyped startup run by two founders who had barely outgrown their teenage years, by competitors and experts alike.

In 2024, Zepto has now raised $1.2 billion in venture capital, with a valuation of $3.6 billion. Everyone was wrong about this little startup, which seems to have achieved something that retail brands only dream to: changing consumer habits. 10-minute delivery is now the norm, so much so that the likes of the good old retail giants Dmart and Reliance Retail are scratching their heads. Even Flipkart and Amazon are scuttling about, trying to crack the hyperlocal delivery space.

Who would’ve thought Zepto would be the company to set the cat among the pigeons?

It’s not random, though. Zepto has tapped into specific advantages – categories, space, and speed. And it certainly has timing to thank. All of these aspects have come together serendipitously for Zepto, but the real question is: does it pose a real threat to India’s largest retail brands?

And if it does, what will they do to stop Zepto?

In this episode of Two by Two, hosts Rohin Dharmakumar, CEO of The Ken and Praveen Gopal Krishnan (PGK), COO of The Ken, speak with guests Seetharaman G and Arvind Singhal to break down how exactly Zepto managed to surprise everyone, and what this means for the e-commerce space, going forward.

About the guests:

Arvind Singhal is the founder of Technopak Advisors, a 30-year-old management consulting firm best known for its insights on retail and consumer goods. Arvind is an absolute expert on all things retail, with 30 years of hands-on experience advising the most prominent retail companies in India and abroad.

Seetharaman G is The Ken’s deputy editor and lead writer on all things retail, FMCG and e-commerce. He’s reported on quick commerce as well as large retail brands in India week after week in Trade Tricks, The Ken’s paid newsletter on retail.

This is Two by Two, The Ken's weekly premium business podcast – we like to call it your own personal investigative brain. New episodes are released every Thursday morning.