Instacart soars 40% as it begins trading, an encouraging sign for tech IPOs

Shares of the grocery delivery company Instacart opened for trading Tuesday at $42, up 40% from their initial public offering price of $30. The performance signaled that investors are eager to take a chance on young tech companies – but only at the right price.

Instacart’s market capitalization, including all outstanding shares, totaled $13.9 billion. But even with the stock price pop, the company’s valuation remained a far cry from the $39 billion that investors assigned it in the private market in 2021. It was a painful loss to investors who had bought in at that peak, sending a harsh reality check to other start-ups that raised money at inflated valuations.