Instacart Acquires Israeli AI Startup Arpalus to Enhance Retail Shelf Management
American food delivery giant Instacart has acquired Israeli startup Arpalus, which develops computer vision and artificial intelligence technology for smart shelf management in retail chains. The financial terms were not disclosed, but Israeli financial media Calcalist estimates the deal to be worth tens of millions of dollars. This marks Instacart's first acquisition in Israel.
Founded in 2019 by CEO Ofir Zilberberg, a former Israeli Air Force and Elbit Systems veteran, and Dr. Rotem Bent (no longer with the company), Arpalus emerged from the Nielsen Innovate incubator and is headquartered in Netanya. The startup has raised approximately $5 million from investors including the Israel Innovation Authority, True Global Ventures, Duo Partners, Techstars accelerator, Noam Lanir, Playhouse Ventures, and private retail investors. Arpalus employs around 20 people.
Arpalus’ technology addresses a major challenge in food retail: accurately tracking physical shelf inventory in real time. Using AI and computer vision models tailored for supermarket conditions, such as variable lighting, weak internet, and thousands of similar-looking products packed closely, the system identifies individual items with over 95% accuracy. The platform operates on any basic smartphone, converting quick video scans of shelves into digital inventory snapshots.
Following the acquisition, Instacart plans to integrate Arpalus’ technology directly into its app, which serves about 600,000 shoppers. This will enable users to scan shelves while ordering, providing dynamic, up-to-date physical inventory data to Instacart and retail partners. The goal is to significantly reduce stockouts, prevent discrepancies in digital catalogs, and improve the online shopping experience by minimizing last-minute product substitutions and cancellations.
Founded in 2012 and headquartered in San Francisco, Instacart is a leading food retail and grocery delivery technology company. It went public on NASDAQ in 2023 with a market value around $11 billion. Instacart connects roughly 1,800 physical retail chains, a network of 600,000 independent shoppers and couriers, and end consumers across the US and Canada. Under former CEO Fidji Simo, now chairperson at OpenAI, and current CEO Chris Rogers, Instacart has shifted from a delivery app to a major retail technology and data platform. Its growth drivers include a digital advertising platform generating over $1 billion annually and advanced tech solutions for physical stores, ranging from smart shopping carts to AI-powered shelf and inventory management.
