I assume instacart has a liquidity event (IPO) lined up for the near future (next 12 months), and a few late stage and previous investors are laying down a cash runway to get the company there. Notably this round ($200m) was less than their last round 1 year ago ($400m) so it seems growth has slowed and its time for an exit.

So its not a bet, its a holdover cash infusion until the IPO, and is not exactly risky given how mature and well-capitalized the company is at this point.

The only real bet is that they'll be able to IPO before a market downturn, which seems pretty safe, I have yet to see anyone put forth and truly plausible triggers for another large global recession - there are no debt and enforcement chains I can see that would drag the system under again. But I'm not a financial expert, just an armchair economist, and if I knew what would trigger the next recession I wouldn't be posting here ;)

>I have yet to see anyone put forth and truly plausible triggers for another large global recession - there are no debt and enforcement chains I can see that would drag the system under again

that's not an indication of anything. has there been anyone who were able to predict the last few recessions with reasonable accuracy?

ok, and yes there were a few traders and economists who did ("the big short" follows 3 of these traders' stories), but in order to trade you need to have a thesis for what and when to buy.

there are tons of gloom and doom traders and economists (usually trying to sell "safe" or alternative assets) but i have yet to read any clear, compelling cases laying out what and when to buy when the first domino falls that will set off the next recession. i'd be interested to read anything you've found noteworthy

The typical advice for the beginning of a market downturn is to buy bonds, which usually act as a safe haven from those fleeing stocks (perhaps untrue currently though). Alternatively, some propose purchasing blue chip dividend yielding stocks, as money moves from risky stocks to tried and true ones.

During a recession/large market correction, you're looking to hold all cash and just buy stocks cheap after they drop all the way to their lowest point (think Ford or AIG in 2008).

The problem with these strategies is that market events usually occur over sufficiently long time frames to obscure their size and direction. Looking back at 2007/2008, Lehman was the obvious "moment" but the market and economy didn't nose-dive instantly to their nadir on the collapse of Lehman Bros. It feels like there was a "moment", but it was only obvious in hindsight.

I'm not talking about safe assets, I'm talking about what to buy now in advance of whatever crash is coming :)

For example leading up to the 2007 crash the pros that saw weakness in the mortgage market created and bought "credit default swaps" allowing them to bet against mortgage-based securities

Ah, well if you could go back in time to last week, you could have made a fortune with put options on VIX ETFs before some of them failed. Volatility being at such a tremendous low is definitely unusual and the possibility of ETF failures was baked in. Maybe in a few years we'll see a movie about people with foresight making money off of that event.

From one armchair economist to another I suspect the Federal Reserve will have something to do with what I wouldn't call a "recession" per se, but a slowing of growth through interest rate hikes.

Fed doesn't have much room to play with interest rates currently, and won't until we see a meaningful pickup in productivity, or else they risk further depressing investment into productive assets and rerouting it into speculative assets (high interest rate = high cost of borrowing/lending = high friction = slows economy down).

We would observe a productivity increase through wage growth, as would be expected in a high employment environment (high demand for labor, low supply sets price of labor [wages] high) but I don't see anything from my viewpoint within the embedded and IoT industry that will meaningfully increase productivity in the near future. So more of the same we are experiencing now

Unless you see some new tech that will improve productivity, in which case please do share!

Ah - that's an interesting perspective I had not considered. I was basing my prediction on the stronger than expected job gains, GDP growth forecasts, and how the Fed is cutting back on quantitative easing.

Keeping an eye on the US inflation report coming out this Wednesday should provide more guidance on what the Fed may do - if it's higher than expected I think the Fed will probably raise rates by another .25%.

Yep, I think the more interesting question is: if labor market is so strong (low unemployment) then why aren't wages increasing meaningfully?

Here's one of my favorite practicing economists giving a bit more insight into the Fed and its interest rate strategy: https://www.newsmax.com/finance/narayanakocherlakota/fed-dri...

It's really important to point out here that market downturn =/= recession. They often occur simultaneously but some market downturns are unrelated to recessions.

>>1) Amazon and Whole Foods: Are they not a concern?

I think they are a concern, not necessarily to Instacart but to all of the grocery chains that need to compete with Amazon/WF. Since Instacart already has the tech/infra/domain knowledge to build this service out, Instacart's value goes shooting up.

3) The grocery stores in my area (midwest) already provide this service at no additional markup and free delivery if you spend over $100.

>2) Economic downturn: Will people still order groceries at a premium?

My wife and I have found that online ordering saves us money. Delivery from one of the local stores (Save-on-foods) costs $8-15. Instead of grabbing random items off the shelves because we're hungry or the store put up an enticing display of sugary cereal, we plan out our meals for the week and only buy what we need. That easily offsets the cost of delivery, while also giving us extra leisure time and saving on gas/vehicle wear & tear.

"1) Amazon and Whole Foods: Are they not a concern?"

I'm guessing this raised happened because of Amazon/Whole Foods [1]

https://www.forbes.com/sites/bizcarson/2017/11/08/instacart-...

competition is a good thing, it encourages all competing parties to strive for a better product.

from an investment point of view, its a bit similar to Lyft vs Uber ... pretty much the exact same business, but there is always room to eat market share.

Competition is good for consumers but not investors. Investors want monopolies.

opinions: 1. instacart gives companies besides amzn/wf a logistics platform to ship out retail goods. It makes these other companies more competitive. This is why you see a company like Target acquire Shipt. 2. it won't be a premium if self-driving cars exist. it might be a waiting game for investors, just like how uber and lyft are floated right now.

> 2) Economic downturn: Will people still order groceries at a premium?

I'm not sure about the data and large trends for this, but here's my anecdote: Right now Instacart is the cheapest way for me to get groceries. Someone with a gun took my driver's license from me a few months ago, my bike was dismantled by thiefs, and I don't live within walking distance of a grocery store.

Lyft/Uber there and back is $20. Bus there and back is $6 (but with added time and stress). Instacart is $5-6.

Yes, eventually, it will be easier for me to bike there or to drive there, but not right now. Right now the cheapest way for me to get a large grocery trip done is Instacart.

So maybe they could survive. Not everyone is in my position, but someone who works two jobs, doesn't have a car and lives far from the store...that could describe a lot of people in the near future.

>Someone with a gun took my driver's license from me a few months ago

Unless this person was a police officer, and you're glossing over a lot of the story, you can obtain a new one at your local DMV and resume operation of motor vehicles...

> you can obtain a new one at your local DMV and resume operation of motor vehicles...

No, my driver's license was from another country. It would have required either thousands of dollars to replace or re-taking the test in the US. Neither options has been something I can do just yet. I'll take the US test soon.

If you're going to victim-shame and tell me, <<oh you just nearly got shot, what's the big deal, just hop on down to the DMV! It's your fault you can't drive a car right now>> that's not exactly such as simple thing to do and would be seriously rude.

Please don't be so mellow dramatic. Here, it took me about 10 seconds of googling to find out how you can replace your license after I figured out where you were from:

https://www.ontario.ca/page/replace-drivers-licence

You are incorrect about how 'simple' it would be for me to replace the license. Please stop assuming you know everything about someone's life and telling them what to do. You are wrong - I cannot follow those instructions to get a new license replacement for a variety of reasons. I was not being melodramatic, I was being honest and real. Stop insulting me and stop being rude.

Might be time you move elsewhere, I think...

If you mean the crime, that was Oakland, and I have recently left. But I still don't currently live near a grocery store. Maybe next move.

Yeah, no way I'm sticking around an area after having my stuff stolen and being mugged at gunpoint. Unless you own property (and even then), I'd find somewhere else...

I'm currently 25 minutes walking distance from a grocery store (not counting the small convenience stores), I got used to just walking to it and buying a limited amount, enough for about a week. Driving is faster, but then I buy more, eat more and the rest goes bad...