Instacart is a really interesting business (it's a logistics play, not a retailer, and logistics is stealthily really sexy – it doesn't matter what sells, you win), but the thing is, US is at least ten to fifteen <i>years</i> behind the rest of the world in grocery sales:<p><a href="http://www.ocadogroup.com" rel="nofollow">http://www.ocadogroup.com</a>
<a href="http://www.lse.co.uk/ShareChart.asp?sharechart=OCDO&share=ocado" rel="nofollow">http://www.lse.co.uk/ShareChart.asp?sharechart=OCDO&share=oc...</a><p>(amongst many – every major UK supermarket has a popular home delivery service).<p>It's up there with mobile and wireline Internet, and cable TV, for areas where moving to the US has felt like moving back to the mid-nineties... there are other areas where the US is unquestionably the leader, but yeah.
That's $8.5M they're going to spend proving (or disproving) market viability, at which point, if it's working:<p>- The stores themselves will just roll out their own competing services. They can't afford for a middle man to eat their margins.<p>- Existing players like Fresh Direct will leverage their complete control over stock and distribution to beat them on price and service. There's a lot of wiggle room when you don't have to deal with stocking physical store shelves.<p>I guess, thanks to AirBNB/Uber, that 'collaborative consumption' is the new hot VC investment.
I really wish Instacart or something similar succeeds. The state of grocery delivery in the Silicon Valley is far from ideal.<p>The key, though, would get the supermarkets involved. The only way to lower the delivery price and stay profitable is to convince the stores that it's in their interest.