Zepto, the fast-growing quick commerce platform, announced that it has raised $340 million in a follow-on funding round, boosting its valuation to $5 billion. This marks a significant increase from its previous valuation of $3.6 billion after a funding round in June.

The latest investment round was led by General Catalyst, with new investors Dragon Fund and Epiq Capital joining in. Existing backers like StepStone, Lightspeed, DST, and Contrary also increased their stakes, reflecting strong confidence in Zepto's growth trajectory.

Aadit Palicha, Co-Founder and CEO of Zepto, highlighted two key reasons for the follow-on financing. “First, the opportunity to bring onboard a lead investor of Neeraj Arora’s calibre from General Catalyst was one we couldn't pass on. Second, strengthening our balance sheet is a strategic move, particularly as the company continues to deliver robust growth and operating leverage”, Palicha said in a statement.

Founded in 2021 by Stanford University dropouts Palicha and Kaivalya Vohra, Zepto has rapidly become one of India’s fastest-growing consumer internet companies. Operating out of Mumbai, the company promises delivery of over 10,000 products within 10 minutes through its extensive network of delivery hubs across the country.

Neeraj Arora, Managing Director of General Catalyst, expressed enthusiasm about the investment. “We are thrilled to partner with Zepto, and believe their quick commerce model is setting the standard for the future of e-commerce in India and beyond”, Arora said.

Zepto plans to double its dark store network from 350 to 700 stores ahead of its anticipated IPO, which is slated for the next two to three years. The company remains committed to maintaining financial discipline as it scales.