Shipt Raises $40M to Fuel Expansion in Suburban Grocery Delivery
Birmingham-based Shipt, the membership-driven grocery delivery platform, has closed a $40 million funding round to accelerate its national expansion. The investment was led by Greycroft Partners, with participation from e.ventures and Harbert Venture Partners.
Strategic Growth in Underserved Markets
Unlike compe*****s focused on urban centers, Shipt is targeting suburban communities with its service model:
- Membership-based platform: \(99 annual fee includes free delivery on orders over \)35
- Current reach: Available in 47 metro areas serving 20+ million households
- Expansion plans: Aiming for 60 markets by year-end and 100 markets within 12 months
Differentiating From Market Leaders
While Instacart dominates with its non-membership model and presence in 31 states, Shipt CEO Bill Smith emphasizes their unique positioning:
“We’re committed to serving ‘the rest of America’ — the suburban families who represent our core membership base,” Smith told VentureBeat. “Our expansion strategy deliberately extends beyond traditional city centers.”
Key Competitive Landscape
- Funding comparison: Shipt’s total raised now stands at \(65M since 2014 vs. Instacart's recent \)400M round
- Service model: Membership requirement vs. Instacart’s pay-per-delivery approach
- Geographic focus: Suburban expansion vs. urban concentration
What’s Next for Shipt?
The fresh capital will fuel:
- Rapid market expansion to meet aggressive growth targets
- Enhanced service capabilities in existing markets
- Potential technology investments to streamline operations
With 250 employees currently, Shipt appears poised to challenge the grocery delivery status quo by focusing on underserved suburban markets. Their membership-based approach and strategic expansion could carve out a significant niche in the competitive on-demand grocery sector.
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