Zepto Secures $450M from CalPERS, Positions for 2026 IPO

Mumbai-based quick-commerce startup Zepto announced a $450 million funding round at a $7 billion valuation led by the US public pension fund California Public Employees’ Retirement System (CalPERS), with participation from existing backers Avenir Growth, Avra, Lightspeed, Glade Brook, The Stepstone Group, and Nexus Venture Partners. The company said it now holds “approximately $900 million of net cash in the bank” and is gearing up for an IPO in 2026.

“This financing is a reflection of our team’s execution to grow the business rapidly while consistently building operating leverage. We now have approximately $900 million of net cash in the bank and are more than well-capitalised for the future,” said Aadit Palicha, co-founder and chief executive of Zepto, in the statement.

On paper, this is not another growth-for-growth’s-sake cheque. The $450 million infusion — led by a large, long-horizon institutional investor — and the company’s self-reported ~$900 million net cash position change the calculus for Zepto’s near-term strategy. With multiple capital injections across 2024 and 2025 (including $665 million in a pre-IPO round in June 2024, $340 million in August 2024, and $350 million in November 2024), Zepto has built a sizeable liquidity buffer uncommon for startups at this stage.

That buffer matters for three reasons: it reduces immediate fundraising pressure ahead of an IPO, it gives Zepto flexibility to invest in logistics and cold-chain capabilities, and it signals to public investors that the company can pursue a listing without an emergency capital raise immediately prior to the float.

Growth and pressure in quick-commerce

Zepto’s raise comes as India’s quick-commerce market scales rapidly. According to the figures shared with this brief, the sector has surpassed $10 billion in gross merchandise value (GMV), with 30 million monthly transacting users and an estimated 15% share of total e-commerce GMV. Redseer Strategy Consultants’ estimates — cited in the company statement — indicate roughly 150% year-on-year growth in the first five months of 2025, driven by an expanding network of dark stores.

A large cash reserve allows Zepto to double down on dark-store density, improve cold-chain capabilities, and refine unit economics without the immediate need to squeeze margins or halt geographic expansion. But ample liquidity does not automatically translate to better margins; execution on operations, demand visibility, and cost control will determine whether this strategy produces sustainable profits.

A layered funding history

This funding round adds to a flurry of capital raises over the past 18 months. The company’s capital table has seen domestic and international investors: the Motilal Oswal private wealth–led $350 million round in November 2024 marked a high-profile domestic placement, while earlier rounds brought in US VCs such as General Catalyst and global growth investors. The latest round again blends large institutional capital with follow-on support from existing backers such as Lightspeed and StepStone.

From an investor-relations perspective, the mix matters: a public-pension lead (CalPERS) brings a different signalling effect compared with venture capital or private wealth investors. For market observers, that’s an explicit nod to Zepto’s maturity and to the long-term investment thesis some big pools of capital are willing to back. Nevertheless, cash is an enabler, but not a cure. The company will still have to face unit economics of last-mile fulfilment, cost of customer acquisition, and structure of grocery retail margin. A capital buffer can postpone the reckoning but does not substitute for operational enhancements and expansion of margins prior to a public listing.
IPO timeline and investor expectations

Zepto is reportedly preparing for an IPO in 2026. For public-market investors, the bar will be clear: evidence of improving operating leverage, a credible path to profitability, and defensible market share in a competitive and capital-intensive segment. The company’s public messaging about being “more than well-capitalised” sets expectations for a tested growth story rather than a last-minute capital scramble.

Balancing growth and governance as Zepto approach public markets

As a private company tightens its timeline toward listing, governance, reporting discipline, and predictable operating metrics become as important as sheer growth. The presence of a lead investor such as CalPERS usually creates an additional level of scrutiny on the topics of transparency and long-term value creation, which may favor Zepto as it moves past the scale-up stage, which primarily deals with private entities, and into a public company.

Zepto’s fresh $450 million and the reported ~$900 million net cash position tilt its near-term playbook toward consolidation and strategic investment rather than aggressive dilutionary growth. The company’s next challenge will be to translate that liquidity into demonstrable operating improvements and margin discipline that will convince public-market investors to back its 2026 IPO.