Instacart buys smart cart maker Caper AI for $ 350 million
- Instacart is acquiring smart cart and payment technology company Caper AI for $ 350 million in cash and stock, the e-commerce provider said on Tuesday.
- Instacart will integrate Caper’s technology into its app and the e-commerce sites of its business partners over time to create unique online and in-store experiences. The acquisition will streamline purchasing for consumers, while making it easier for Instacart employees to fill orders, the company said.
- This is Instacart’s second announced acquisition this year as the company seeks to strengthen its technology offerings to its retail partners.
Instacart is preparing for the future of shopping beyond the pandemic and its e-commerce boom by investing in solutions that combine offline and online shopping.
“As we look to the future, we are focused on creating even more ways for retailers to develop unified commerce offerings that help meet the needs of consumers both online and in-store,” Instacart CEO Fiji Simo said in the announcement.
Ultimately, Instacart sees Caper as a way to build a full business. For example, with Caper, Instacart customers will be able to create shopping lists that will appear on their online account and also on the smart cart.
Founded in 2017 and based in New York City, Caper offers a plug-and-play payment solution that it says is significantly less expensive to implement than large-scale systems like Amazon Go. The Caper cart uses AI-powered cameras and weight sensors to recognize items placed in the cart without having to scan or weigh them and offer interactive in-store shopping with touch screens that can offer basket-based recommendations, nearby offers and other features. Customers can pay with the shopping cart, bypassing the checkout lines.
The Caper Counter, which debuted last fall, uses cameras and a weight sensor to automatically detect items for contactless self-service checkout.
Caper’s website says it plans to add smart location sensors to allow people to find and be guided to certain items in the store. While Instacart already has mapping technology for its employees, Caper’s technology will save them time by allowing them to bypass checkout lines, Instacart said.
Caper’s smart carts were the first carts in the United States to gain approval from the federal government’s National Type Assessment Program, certifying that they can sell products with accuracy. which are priced by weight and measures, like products and bulk items, Instacart noted in the ad.
Instacart said Caper’s technology will make it faster and easier for customers and employees to shop at grocery and convenience stores of all sizes. For its retail partners, Instacart said Caper’s technology increases the average basket size compared to traditional shopping carts. Instacart said it would work on economies of scale with Caper to lower hardware production costs, making carts and meters more affordable.
Caper also has a much sought-after component: data. The carts track shoppers’ purchases and provide a way for retailers to deliver personalized offers while they shop, according to Caper’s website. Caper’s plan for tracking carts will also help businesses understand shoppers’ journey through the store and provide them with location-based product offerings, according to the company.
The acquisition also adds Caper employees and their hardware expertise to Instacart workforce, by developing the company’s knowledge of products and technology.
For Caper, being acquired by Instacart gives it more visibility with retailers and customers and opportunities to develop its activity. The company’s customers include Sobeys, the second largest food retailer in Canada; Schnuck Markets; Foodcellar Market, an organic grocery store with two branches on Long Island; Wakefern; and Auchan in France and Spain. Last fall, Caper began piloting a branded smart cart solution with Kroger called KroGO.
Instacart’s foray into the smart cart space comes at a time when Amazon’s Dash Cart and Just Walk Out technologies – among other in-store shopping innovations like a palm-read payment tool – have disrupted the grocery industry. Competition is intensifying in the area of smart carts and cashierless payments, with companies like Shopic and WalkOut selling technologies that modernize carts.
The acquisition is the second this year for Instacart and the fifth overall. Less than three weeks ago, Instacart announced the takeover of catering software company FoodStorm. Like FoodStorm, Caper will further strengthen Instacart’s investments in its suite of enterprise technology services.