Instacart Co-founder and CEO Apoorva Mehta to Transition as Executive Chairman; to be Replaced by Facebook’s Fidji Simo
- In a letter to the employees, the 34-year-old promises “to remain very engaged day-to-day” and to partner with the new head to shape the company’s “long-term vision.”
After leading the grocery delivery startup for nearly a decade, Instacart co-founder and CEO Apoorva Mehta, 34, is transitioning to the role of executive chairman, effective Aug. 2. Facebook executive Fidji Simo will replace Mehta as the CEO.
Announcing on Twitter, Mehta shared a letter he wrote to Instacart employees. “I’m excited to share that we’ve recruited @fidjissimo to join us as Instacart’s new CEO as I transition to Executive Chairman on August 2. As one of the most formidable consumer tech leaders in the world, I’m thrilled to partner with Fidji.”
In the letter, Mehta discusses his decision to transition and why he believes “Fidji is the right person to lead Instacart into its next chapter.” Noting that “building Instacart over the last 10 years has been the most challenging and fulfilling experience” of his life, Mehta details the formation of the growth and its eventual growth. Speaking about his new role as executive chairman, Mehta assured his employees that he’s not leaving. “I plan to remain very engaged day-to-day and to partner with Fidji to shape our long-term vision and help make the key strategic moves that will determine the future of Instacart and the industry.”
Mehta has been working alongside Simo since he joined the board this January.
“As I thought about the ideal role for Fidji, I realized that this advice now applied to my own situation,” reads the letter.” Fidji will simply be a better CEO than me for Instacart’s coming years. I won’t pretend that it was an easy decision. Instacart has been my life’s work. However, once I came to the conclusion that it would make for a better long-term future for our business, I knew that bringing Fidji on as CEO was the right path forward for the company.”
However, a July 27 report in the Business Insider notes that according to employees and others who’ve worked with Mehta, the company’s decision to replace him, “came after several years of chaotic management and high turnover among executives, especially on the product side.” And “although many credit the cofounder with building one of the largest grocery-delivery businesses, they say Instacart’s growth outstripped his ability to run the company effectively, especially last year during the pandemic.”
The company is looking to go public, the Business Insider report says, “aiming for a listing at a valuation of at least $50 billion.”
Last year, Mehta entered the coveted list of billionaires. Forbes reported then that Mehta’s addition to the list comes after the San Francisco-based unicorn’s value rose from $7.9 billion to $13.7 billion. A unicorn is a privately held startup company valued at over $1 billion. Forbes estimates that “Mehta owns a 10 percent stake, making him the newest member of the three comma club with a net worth of $1.2 billion.”
Mehta was born in India and raised in Canada. He studied engineering at the University of Waterloo and worked as a design engineer at Blackberry and Qualcomm. He moved to Seattle, Washington, to work at Amazon.
Mehta began the grocery delivery startup in 2012. The demand for the company’s delivery model has skyrocketed due to the coronavirus pandemic. Citing estimates from Instacart, Forbes reported then that the company’s “order volume has gone up by as much as 500 percent in the past 12 months,” with the average customer spending up to 35 percent more per order.
According to the Forbes report, Instacart has hired 300,000 new shoppers since March and announced plans in April to hire 250,000 more “to get back to offering one-hour and same-day deliveries.”
Mehta was born in India and raised in Canada. He studied engineering at the University of Waterloo and worked as a design engineer at Blackberry and Qualcomm. He moved to Seattle, Washington, to work at Amazon as a supply chain engineer where he worked on Amazon’s Fulfillment Engine “to deliver packages quickly and efficiently to customers,” his LinkedIn profile says.
In a January 2017 interview with the Los Angeles Times, Mehta said that at Amazon, he learned that he “liked to build software, and he wanted to be challenged.” But after two years, he quit his job because he felt that he was no longer being challenged.
He then moved from Seattle to San Francisco and started trying his hand at entrepreneurship.
Mehta told the Los Angeles Times that he tried his hand at “at least” 20 companies, before starting Instacart. He said he tried building an ad network for social gaming companies and spent a year developing a social network specifically for lawyers. “I knew nothing about these topics, but I liked putting myself in a position where I had to learn about an industry and try to solve problems they may or may not have had,” he told the paper.
However, none of the companies worked out.
Eventually, Instacart was born in 2012. Although Mehta landed on “a hot idea” and was able to partner with stores such as Whole Foods, Target and Safeway, the LA Times says that “the expansion of Instacart wasn’t without problems.”
The company was slapped with a class-action lawsuit in 2015, alleging that the workers who shopped for and delivered groceries were misclassified as independent contractors. Instacart eventually made its shoppers part-time employees, with some qualifying for benefits such as health insurance. “We went from having zero part-time employees to having people at thousands of individual store locations,” he said, “We had to figure out scheduling and what kinds of training had to be provided. We needed to figure out a lot of things.”
Instacart has since expanded from San Francisco to more than 5,500 cities and 30,000 stores in North America. The company also launched a prescription delivery service in April 2020 which delivers medications from nearly 200 Costco pharmacies.