Instacart's valuation has exploded to $39 billion following a fresh round of funding and a partnership with Dollar Tree (NASDAQ: DLTR) to make deliveries for over 6,000 Family Dollar branded stores. TechCrunch reports the $265 million in new funding comes from previous investors such as D1 Capital Partners, Sequoia Capital, and T. Rowe Price Associates. The COVID-19 pandemic drove strong gains for Instacart during much of 2020 as people turned to grocery delivery, the company's specialty. Instacart says it inked delivery partnerships with approximately 200 more retail companies during 2020, branching out into "prescriptions and over-the-counter medications, office supplies, electronics, health, beauty and wellness, home decor, [and] sports equipment" besides its original grocery sector activity. Image source: Getty Images. Multiple rounds of funding ahead of a planned IPO, the date of which Instacart hasn't yet specified, skyrocketed its valuation from $17.8 billion in November to the current $39 billion, according to The Economic Times and other sources. While the company remains cagey about its IPO date, it recently made Nick Giovanni, a Goldman Sachs banker involved in the IPOs of Twitter and Airbnb, its chief financial officer, Daily U.K. News reports. Instacart expects its business to keep growing strongly even as COVID-19 ebbs. Its press release notes it's planning on "increasing our corporate headcount by 50% in the first half of 2021" and states the $1.3 trillion North American grocery market is "still in the early stages of its digital transformation" with plentiful room for additional "online grocery penetration." Like other delivery companies such as DoorDash, Instacart could also continue to benefit from initiatives such as California's Proposition 22 that classify delivery drivers as independent contractors rather than employees, helping to control costs. 10 stocks we like better than Dollar Tree IncWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Dollar Tree Inc wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of February 24, 2021 Rhian Hunt has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Twitter. The Motley Fool recommends Airbnb, Inc. The Motley Fool has a disclosure policy.Source