PayCargo has received $35 million from private equity firm Insight Partners to further expand its operations in the automated freight payment space.
Coral Gables, Florida-based PayCargo, which started operations in 2009, experienced more than 80% transaction growth during the past year. The company estimated that it has processed over $2 billion in transportation payments since its start.
“We are excited to work with PayCargo to continue to scale its global payments network and through our Insight Onsite team of ScaleUp and operational experts, help bring additional resources to its impressive list of customers,” said Ryan Hinkle, Insight Partners managing director, who will also become part of PayCargo’s board.
PayCargo Global CEO Eduardo Del Riego told American Shipper that the funds will be used to grow the business, with emphasis on expanding digital connections between payer and vendor systems.
“Organic is key,” he said. “We’re not looking for acquisitions. We want to improve the connectivity of the software, heighten workflow, and greatly improve data availability.”
Specifically, PayCargo will invest in technologies using artificial intelligence and API (application programming interface). “The goal is to assist our industry in lowering costs and working more efficiently,” Del Riego said.
PayCargo’s transportation payment service covers all modes and third-party logistics services providers (3PLs).
Here is how it works: A shipper or 3PL operating on the PayCargo portal receives electronic notification from the carrier of a transportation invoice; creates a transaction in the PayCargo online portal; and then reviews and approves it. As soon as the transaction has been approved in the system, the carrier receives immediate notice that it has been approved and receives payment in their account by 6 the next morning.
The company has witnessed an increased demand for its services during the past year as governments imposed social-distancing measures to slow the spread of the deadly coronavirus. This has caused thousands of shippers, 3PLs and transportation providers to abandon payment of transportation invoices with paper checks.
Some of PayCargo’s largest customers include 3PLs such as Kuehne + Nagel, DHL, DB Schenker, BDP International, SEKO Logistics, UPS, and Yusen Logistics, and carriers like Hapag-Lloyd, Mediterranean Shipping Co., Ocean Network Express, Alliance Ground, Swissport and AirFrance.
PayCargo has established partnerships with other online freight industry platforms, such as the International Air Transport Association, Cargo Network Services, CHAMP Cargosystems, IBS, Accelya, Unisys and Kale Logistics.
In addition, PayCargo has expanded services beyond online transportation payments. Earlier this year, it launched an independent company, PayCargo Capital, to offer shippers and 3PLs in North America that already use the PayCargo platform to pay their transportation bills to apply for credit of $50,000 to $2.5 million for a 15- to 45-day period.
“We began as an urgent payment solution,” Del Riego said. “As we expand our network (domestically and internationally) we view PayCargo as the payment/settlement system for block chain of the logistics space.”
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Click for more FreightWaves/American Shipper articles by Chris Gillis.
