Instacart partners with Walmart to compete with Amazon

(CNN Business) Just three years ago, Instacart's future seemed bleak. Whole Foods, one of its biggest partners at the time, was acquired by Amazon (AMZN), leaving an uncertain future for the grocery delivery startup.

Now, Instacart, whose business has soared during the pandemic, is partnering with one of Amazon's biggest rivals: Walmart (WMT). Instacart confirmed to CNN Business on Tuesday that it will offer a same-day delivery option at Walmart locations in four markets -- Los Angeles, San Francisco, San Diego and Tulsa.

"The new partnership brings thousands of items - from groceries, alcohol and pantry staples to home decor and improvement, personal care, electronics and more - at everyday low prices from Walmart stores to customers' doors in as fast as an hour," said an Instacart spokesperson in a statement to CNN Business.

The news was first reported by CNBC.

After years of working to build momentum, Instacart and other food delivery services have found their moment during the pandemic. Since March, Instacart has added hundreds of thousands of new contract workers -- who shop and deliver groceries -- and raised $325 million in new financing, giving it a valuation of nearly $14 billion.

With Instacart, customers can place orders for delivery and its workers — either its in-store shoppers or its contract workers — will shop for the items; then, the contract workers will make the delivery. Alternatively, customers can purchase items for pickup at select locations. In this case, an Instacart-employed in-store shopper or an employee of the retail store will shop for items and package them for pickup.

Instacart partners with more than 400 retailers in North America, including Aldi, Costco, Kroger and Wegmans. More recently, the company has struck deals with Big Lots and Staples on same-day delivery, giving consumers alternatives to Amazon.

With grocery delivery and curbside pickup booming due to the pandemic, some grocers are rethinking the services they provide to consumers.

"We're always looking for partners to help us better serve our customers. Customers love the value we bring with pickup and delivery," said Walmart spokesperson Molly Blakeman in a statement to CNN Business. "As we continue to expand our own delivery from nearly 3,000 stores reaching nearly two-thirds of American households, we're excited test and learn in four markets reaching new customers with Instacart."