DoorDash is acquiring Instacart in a US$17 billion deal that will bring two major delivery platforms under one corporate roof and significantly expand DoorDash’s position in online grocery shopping.
The companies said the Instacart name and app will remain in place after the transaction. Instacart shoppers will continue completing orders through the platform, while grocery retailers will retain the option of working with either Instacart or DoorDash. Instacart customers are expected to gain access to a further 50,000 stores covered by DoorDash.
A major expansion beyond restaurant deliveries
For DoorDash, the acquisition strengthens a business that began with restaurant meals but has since expanded into grocery, pet food and electronics. The San Francisco-based company operates in 40 countries and completed more than 3 billion orders last year through a network of about 9 million independent delivery workers.
Instacart brings a more specialised grocery operation. Founded in 2012, it focuses on deliveries from supermarkets and convenience stores in the United States and Canada. Its approximately 600,000 independent shoppers completed 338 million orders last year, according to company filings. Instacart has a market value of about US$14 billion, while DoorDash’s market value is about US$73 billion.
| Company | Key figures | Core position |
|---|---|---|
| DoorDash | 40 countries; more than 3 billion orders in the past year; 9 million delivery workers | Restaurant delivery expanded into groceries and other goods |
| Instacart | 600,000 shoppers; 338 million orders in the past year | Grocery and convenience delivery in the US and Canada |
Why grocery delivery is difficult to scale
The deal reflects the operational complexity of delivering food compared with many other online purchases. Grocery orders require a worker to select products in a shop, respond when an item is unavailable and manage goods that can spoil or lose quality. Chilled products also have to reach customers before they deteriorate.
“Grocery is one of the hardest things to get right online. Someone has to pick a ripe avocado, find a substitute you’d choose yourself, and get the ice cream to you before it melts,” DoorDash co-founder and chief executive Tony Xu said.
Xu said the transaction would combine Instacart’s grocery experience with DoorDash’s logistics and delivery capabilities. The companies’ stated aim is to give retailers of different sizes access to more delivery tools and expand the potential of online grocery sales.
Pressure on Instacart
The transaction comes as competition has reduced Instacart’s share of spending on US delivery platforms. According to Consumer Edge, a market research company, Instacart accounted for 26% of spending on those platforms five years ago. Its share has since declined to 18%, as DoorDash has gained ground.
DoorDash started building its grocery operation in 2020, during the surge in online demand associated with the pandemic. Retailers were initially cautious about the model. Kroger, one of the largest grocery chains in the US, partnered with DoorDash in 2022 but first limited deliveries to flowers, sushi and prepared meals from a restricted number of shops.
That relationship later broadened. DoorDash now lists the full inventory of all 2,700 Kroger stores in the US on its online marketplace. The company also added deliveries from Costco last month, increasing the range of major retailers available through its platform.
- Customers: Instacart users are due to gain access to more stores through DoorDash’s network.
- Retailers: Grocery businesses will be able to continue choosing between the two platforms.
- Workers: Instacart’s independent shoppers are expected to keep fulfilling orders through the Instacart service.
- Industry: The acquisition brings together a grocery specialist and a large, diversified delivery network.
The combined business will have greater scale across ordering, shopping and delivery, while the continued use of the Instacart brand is intended to preserve its established grocery identity. The deal also illustrates how delivery companies are seeking growth beyond their original market as customers increasingly use digital platforms to buy everyday goods.
