Within two months of raising a pre-IPO funding round of $665 million, QuickCommerce startup Cepto has raised $340 million in follow-on financing led by US-based venture capital firm General Catalyst, taking its valuation to $5 billion. New investors Dragon Fund and Epic Capital joined the round, while existing investors StepStone, Lightspeed, DST and Contrary increased their stakes.

As it reshapes India's e-commerce sector, pushing giants including Walmart-backed Flipkart and Tata's BigBasket to foray into instant deliveries, the Mumbai-based company is in the midst of securing some of its biggest funding rounds so far this year. According to Adit Palicha, founder and chief executive officer of Zepto, the new round will enable the firm to strengthen its balance sheet as it gears up to deliver "strong growth and operational benefit."

"While these recent funding commitments reflect strong confidence in Zepto's performance to date, we recognize that there is still a lot of execution ahead of us to fulfill our ambition of building a world-class Internet company from India. At SEPTO, we sincerely feel that we are at the beginning of our journey, "Palicha said.

The deal is one of the first investments made by General Catalysts since its acquisition of Venture Highway. In June, it was reported that the merged entity plans to invest $500 million to $1 billion in early growth-stage investments in the country. Zepto, which is preparing for a public market listing next year, gained unicorn status a year ago when the company raised $200 million at a valuation of $1.4 bn.

According to consulting firm RedSeer, India's quick-commerce market will grow 77% in 2023 to reach $2.8 bn in gross merchandise value (GMV). GMV, a key metric in e-commerce, tracks the total value of all goods sold on a platform without including discounts and other costs. Septo was founded by Palicha and Kaivalya Vohra in April 2021. The four-year-old start-up is preparing for an initial public offering of its shares next year and is targeting a multi-billion dollar listing.