Instacart Teams Up With Northgate Gonzalez Market

Just a few days after teaming up with Staples, Instacart has added another retail partner to its roster — this time, another grocer.

The online grocery company has partnered with Northgate González Market to deliver groceries from 36 store locations across Southern California. Northgate Market customers in Los Angeles, Orange, Riverside and San Diego counties can now have their groceries and household essentials delivered directly from the store to their door.

“We know that people and families across Southern California are looking for convenient and reliable shopping options from the grocers that have been feeding our communities throughout this crisis. We’re proud to partner with Northgate González Market, giving their customers access to the groceries they need from the retailer they know and love,” said Andrew Nodes, vice president of retail at Instacart. “We recognize that delivery has become essential for many and we’re dedicated to ensuring our retail partners can connect with their customers online during this time.”

The announcement comes a few days after Instacart announced it had secured $225 million in new funding to scale its operations as it races to keep up with unprecedented shopper demand for online grocery. The new cash infusion comes at a pivotal time for the company and for the online grocery space. More and more shoppers are buying groceries online due to the pandemic. Instacart has benefited from that over the past few months. Meanwhile, many of Instacart's competitors, from startups to big retailers, are still racing to prioritize online capabilities and contactless shopping to meet new consumer demand.

“Northgate González Market is proud to partner with Instacart to provide additional shopping options to our loyal customers,” said Mike Hendry, executive vice president, marketing & merchandising. “Given our company’s expanding and increasingly diverse customer profile, our partnership makes total sense as we continue to strive to provide our customers with excellence in customer service, various shopping options and an enhanced shopping experience.”

Instacart’s share of grocery pickup and delivery sales jumped to 55% in the third week of May, up from about 30% in February, according to research firm Second Measure. According to Instacart, its order volumes have surged as much as 500% over the past few months as shoppers have migrated to shopping for groceries online during the pandemic.

The $225 million is part of a new financing round led by DST Global and General Catalyst, with existing investor D1 Capital Partners participating. This new round brings the company's valuation to $13.7 billion; it was valued at $7.87 billion in its last funding round in November 2018, when it raised $871 million. The company now has nearly $1 billion in cash on its balance sheet.

Instacart said that it expects to deploy the new capital in a number of ways, among them continuing to support its growing shopper community with new services and features; further investing in key businesses such as Instacart Advertising and Instacart Enterprise; and further scaling its operational and technical teams to help meet the increased customer demand for grocery delivery and pickup.

Instacart, which has hired about 300,000 new workers since March, is now accessible to more than 85% of households in the United States, across all 50 states, and more than 70% of households in Canada. The company has accelerated its launch cadence with retailers since the start of the year and now partners with more than 400 national, regional and local retailers across more than 30,000 stores in the United States and Canada.

Earlier this month the company announced that it has teamed with Columbus, Ohio-based Big Lots to deliver not just consumables, but also furniture and other hard goods. The Staples deal is the second time this month that Instacart has partnered with a non-grocery retailer to offer same-day delivery.