Instacart’s Turnaround CEO Heads To The AI Frontier

Fidji Simo, Instacart’s CEO since August 2021, said yesterday she’ll move to OpenAI later this year to run its consumer products. Her departure comes after transforming Instacart from a pandemic-boosted delivery service into a retail technology powerhouse with a profitable advertising business.

When Simo accepted the Instacart CEO role, she could have been stepping onto what management researchers call a “glass cliff” – when women are disproportionately appointed to leadership positions during periods of crisis, increasing their risk of failure. At the time, Instacart’s pandemic hyper-growth had stalled, valuations were collapsing, and competition with Amazon, Walmart, DoorDash and Uber was intensifying. But she steered the company back to growth instead of the slide many analysts expected.

OpenAI is likely betting that her retail-media experience will translate into new, revenue-generating consumer tools. As CEO of Applications at OpenAI, Simo will lead one of the three operational pillars at OpenAI (Research, Compute, and Applications). While Sam Altman remains group CEO, Simo becomes the day-to-day steward of every customer-facing product from ChatGPT to DALL-E and the GPT Store.

How Simo Scaled Instacart’s Ad Business

Simo’s most notable contribution at Instacart was scaling the company’s nascent advertising business into a retail media powerhouse. While Instacart rolled out its self-serve advertising platform in late May 2020—more than eight months before Fidji Simo joined the board (February 2021) and well over a year before she became CEO (August 2021)—the platform was still in its early stages. Under Simo’s leadership, what began as a basic advertising offering evolved into a sophisticated retail media network generating nearly $1 billion in annual revenue in 2024.

In 2022, Fidji Simo unveiled Carrot Ads—one of four modules in the new Instacart Platform—which lets retailers graft Instacart’s entire retail-media stack onto their own digital storefronts. By flipping a switch, a grocer such as Schnucks or Sprouts can surface the same sponsored-product and display auctions—backed by Instacart’s pool of thousands of CPG advertisers—that already run inside the Instacart marketplace. The retailer keeps a share of the ad revenue, brands gain a single self-serve portal and unified reporting, and Instacart suddenly extends its media business far beyond the walls of its app.

That turnkey approach appealed to mid-size grocers that lacked the budget to build an ad stack in-house. April Lane, Chief Merchandising Officer of Thrive Market, told me in an interview that the company “chose Carrot Ads after testing multiple platforms because it balanced ad density with a cleaner UX for our members.”

To support this expansion, Simo introduced Carrot Insights—dashboards that merged in-app ad data with store-level sales and inventory, giving CPG brands a single return-on-ad-spend view and providing grocers evidence they weren’t cannibalizing their brick-and-mortar lanes.

The retail media strategy reached a significant milestone when Instacart’s advertising and “other” revenue surpassed a $1 billion annual run-rate in Q4 2024, with the platform being used by more than 220 retailer banners and 7,000+ CPG brands.

From Innovation To Profitability

While retail media formed a cornerstone of Simo’s strategy, her broader vision included connecting digital and physical shopping experiences through technology.

In January 2024, Simo activated personalized advertisements inside Caper smart carts, bringing Instacart’s targeting capabilities directly into physical store aisles and giving brands a consistent campaign canvas from phone to cart screen. This move let brands target shoppers in the aisle, not just on phones.

Simo also took Instacart public, despite a lukewarm tech market. On September 19, 2023, Instacart’s IPO priced at $30, raised $660 million, and closed up 12% on its first day. The valuation of approximately $10 billion was just a quarter of its 2021 peak, but represented the first profitable online grocery operation of its kind.

The groundwork for this financial turnaround began immediately after Simo took the helm. She implemented immediate triage: freezing headcount, renegotiating cloud contracts, and pushing the first-ever unit-economics disclosures to the board, setting the stage for later profitability.

AI Innovation In Grocery

In her final months at Instacart, Simo laid groundwork that could inform her approach at OpenAI, particularly in applying generative AI to shopping experiences.

On March 18, 2025, Simo unveiled Smart Shop, a generative AI layer that analyzes 17 million SKUs and billions of past purchases to serve real-time diet tags and dynamic shopping prompts—establishing a foundation for health-centric, AI-driven merchandising. This capability could potentially transfer directly to OpenAI applications.

Simo also demonstrated Instacart’s continued ability to ship consumer products with startup speed. In just six weeks, a skunkworks team delivered Fizz, a standalone group-ordering app with built-in payment splitting and event integration features—proving Instacart could still develop consumer products rapidly while testing social commerce loops aimed at Gen Z users.

What Simo Could Bring To OpenAI

Simo’s experience at Instacart provides several capabilities that could reshape OpenAI’s product strategy, particularly in commerce applications:

1. Retail Media Expertise: With her advertising chops, Simo could develop a privacy-sensitive “AI media network” featuring sponsored answers, shoppable chat, and contextual commerce inside GPTs, with brand-safe controls. This would mirror her Carrot Ads strategy of expanding monetizable surfaces beyond traditional confines.
2. Physical-Digital Integration: Her experience with Caper smart carts and connected stores could inform how OpenAI integrates vision models into physical-world devices—from voice-AI kiosks to AR shelf advice and cashierless checkout systems.
3. Operational Discipline: Beyond retail and media, Simo’s turnaround skills and cost discipline could bring operational rigor to balance OpenAI’s hyper-growth with margin concerns, particularly critical as compute costs continue to rise.

The Bigger Picture

In her statement about joining OpenAI, Simo highlighted the transformative potential of the role: “Joining OpenAI at this critical moment is an incredible privilege and responsibility. This organization has the potential of accelerating human potential at a pace never seen before and I am deeply committed to shaping these applications toward the public good.”

This vision aligns with her track record at Instacart, where she consistently focused on building technology that improved both retailer operations and consumer experiences. Her background in both Facebook’s advertising ecosystem and Instacart’s retail media revolution gives her unique perspective on how AI could reshape commerce.

As I’ve previously written for Forbes, AI shopping assistants represent the next frontier in the consumer shopping journey – from research and discovery through ads, to actual purchasing and repurchasing. Simo’s move to OpenAI could accelerate this trend, bringing structured product data, monetization expertise, and personalization capabilities to conversational AI platforms.

With retail media networks now proliferating across the industry, Simo’s experience building a differentiated offering at Instacart could help OpenAI establish unique value propositions in what is becoming an increasingly crowded space. Her understanding of both retail economics and cutting-edge technology positions her uniquely to bridge these worlds at OpenAI.