Zepto FDI laws compliant, aims to be majority India-owned: Aadit Palicha
Zepto, which has raised another $350 million in new funding from prominent domestic investors, aims to become a company with a majority Indian ownership, chief executive Aadit Palicha said.
Zepto is not an “Amazon or Walmart” but an Indian firm with plans to go public on Indian bourses, Palicha said in an interview with ET. He said the four-year old firm is not hurting kiranas or mom-and-pop stores — an allegation that Zepto and other quick-commerce firms are facing — and is a “net-job creator to the country’s consumption story".
Founded by Stanford University dropouts Palicha and Kaivalya Vohra, Zepto has emerged as one of the fastest-growing consumer internet firms in India, fuelled by $1.4 billion that it raised in the last five-six months.
The quick growth has come at the cost of skyrocketing cash burn, as it has been dipping into cash reserves for dark-store expansion as well as for funding incentives and discounts to acquire customers. ET reported that Zepto’s monthly cash burn has risen to more than $35 million, signalling the constant need for capital infusion.
Palicha said the firm is “multiplying on a scale of billions of dollars” while admitting to the high costs involved in the growth. “As long as the mature (dark) stores keep turning profitable and you can show the operating leverage in the time to profitability — that's a good place to be in,” he said, adding that 70% of its existing dark stores are profitable and that the timeline for newer stores to turn cash positive has reduced.
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