Instacart has named Facebook executive Fidji Simo as its new Chief Executive Officer. The development comes just seven months after Simo joined the grocery delivery giant as the board of directors. Simo will replace former CEO and co-founder Apoorva Mehta. According to a statement issued by the company, Mehta will transition to executive chairman of the company’s board. “Apoorva Mehta will be very engaged on day-to-day business.” 35-year-old Facebook app lead will start her new role on August 2. The changes hold significance the company is planning for an initial public offering (IPO). But Mehta’s departure from his role at a time when the company was so close to its expected IPO is as notable as it is rare. Mehta, a former Amazon employee, founded Instacart almost 10 years ago. He helped the company to become one of the most valuable start-ups. From incubating Instacart through Y Combinator’s 2012 summer batch to making it as big as it is today with the most recent valuation of USD 39 billion, Mehta remains at the core of everything.
When the coronavirus pandemic struck last year, people realized the real purpose of Instacart. With millions of people in quarantine, users tend to used delivery services. As the delivery demand surged, Instacart became a virtually essential service. Instacart hired thousands of workers during that period. To tap the opportunity, it also launched same-day delivery on a variety of products. This exponential growth of the company made it a challenging contender in online groceries alongside Amazon and Walmart. The company generated net revenue of about USD 1.5 billion last year. This, at a time when several companies and startups were struggling to survive. But the growth was followed by a fair share of controversy. It joined companies like DoorDash, Lyft, and Uber to back Proposition 22 that classify gig workers as independent contractors. This limited the types of benefits these workers could receive. But Proposition 22 was eventually passed and it turned out to be beneficial for Instacart.
Commenting on the development, Mehta said that he had never imagined the day when someone else would be running the company. “The idea of someone heading the company never came to my mind. But this changed when I met Fidji Simo. We share the same vision for the future of Instacart,” Mehta said. Simo, who worked with Facebook for almost a decade, joined the board of directors of the company in February this year. In the past 10 years, Simo reached the top of the product ladder of the social media giant. She was next to just chief executive officer Mark Zuckerberg and Chris Cox in the organizational chart. At Facebook, Simo helped scale the company from the strength of 1000 to 100,000 employees. Meanwhile, Instacart has been on a hiring spree and has hired a series of top executives. Nick Giovanni was appointed CFO of the company in January. Giovanni worked with Goldman Sachs before joining the company. Asha Sharma, Facebook vice president, too joined the company. She joined as a chief operating officer in February. Most recently, Snowflake CEO Frank Slootman joined Instacart as its board of directors.