Instacart's defining moves.
The defining strategic moves at Instacart — each one explained and grounded in the record.
The Money Machine · Business Model
Instacart Isn't a Delivery Company. It's an Ad Network That Happens to Carry Your Groceries.
Everyone thinks Instacart makes money on the markup. It doesn't - the shoppers and fulfillment eat most of that. The real engine is advertising: $958M of high-margin revenue in 2024, 28% of the top line, and the part the company itself called vital to profitability.
7 min
The Money Machine · Business Model
Instacart Barely Makes Money on Your Groceries. It Makes It on the Brands.
Everyone thinks Instacart profits on delivery fees. It earns roughly $7 of gross profit on a $110 order. The real engine is advertising sold to CPG brands at ~80% margins — which carried the company from a 4.2% take rate in 2019 to nearly 10% in 2023.
8 min
The Counterfactual · Decision Forks
Instacart Was Never Worth $39 Billion. The Grocery Business Was the Decoy.
In March 2021 a $265M round valued Instacart at $39B. By the time it went public it was worth ~$10B. The collapse looks like a failure - revenue actually grew 39%. What changed was the question Wall Street was asking, and what Instacart had become while no one was watching: an ad business wearing a delivery apron.
8 min