App for grocery delivery The Wall Street Journal reported on Monday, citing persons familiar with the situation, that Instacart Inc. does not intend to raise a significant amount of money in its US initial public offering and would instead concentrate on the selling of workers’ shares.
According to the article, the sale of the majority of employee shares would help the firm retain top talent while allowing Instacart’s personnel, including some of its first recruits, to cash in on some of the shares they have been collecting.
When approached by Reuters about the allegation, Instacart declined to comment.
According to the WSJ story, the shares would be offered directly to new investors at an agreed-upon price before a stock market launch.
IPO
The news of Instacart’s decision comes at a time when investors are being compelled to refrain from supporting initial public offerings (IPOs) due to market instability brought on by Russia’s invasion of Ukraine and rising international interest rates.
Soon after cutting its value by 40% due to market instability, Instacart said in May that it has filed a secret application with the US securities commission to go public.
Fidji Simo, the head of Facebook Inc’s app, was appointed as the company’s CEO last year, bringing significant tech experience to the position ahead of the US grocery delivery company’s anticipated IPO.
Instacart capitalized on an increase in online purchasing brought on by the COVID-19 epidemic in October 2020 by raising $200 million in a fundraising round, valuing the business at $17.7 billion.
