FreightTech startup Cargado announced Monday it has secured $6.8 million in seed funding that will be used to expand its team and enhance the company’s product.
The seed round was led by Primary Venture Partners with participation from existing investors Ironspring Ventures, Zenda Capital, Wischoff Ventures and Proeza Ventures, along with new investor RyderVentures.
Cargado secured $3 million in pre-seed funding in January.
Cargado was founded by CEO Matt Silver and Rylan Hawkins, chief technology officer, in October 2023. Silver declined to reveal how Cargado will specifically operate in the cross-border space for the moment, but said the sector is ripe for logistics technology innovation.
“We see so many different problems and opportunities with cross-border freight,” Silver said. “I have a really strong understanding of all the problems that go into every part of the process of moving freight between the U.S. and Mexico. We’re excited to be building technology that operators involved in the cross-border process can leverage to do their jobs better, to make more money and grow their businesses, and to generally be able to be more efficient and successful.”
Related: Matt Silver launches US-Mexico logistics tech startup Cargado
Zach Fredericks, a principal at Primary Venture Partners, said Silver has been on his radar since Forager, a Chicago-based, venture-backed FreightTech company Silver founded in 2018.
“At Primary Venture Partners, our investment thesis is built around investing in the technology that reduces the transaction costs of building a more durable supply chain,” Fredericks told FreightWaves.
Prior to joining Primary Venture Partners in January 2023, Fredericks spent over three years working in product management at on-demand freight marketplace Loadsmart.
“We think there’s just this tremendous opportunity for software, for AI, for data infrastructure, for marketplaces, for financial technology to reduce a lot of that pain that comes with building more durability and optionality into your supply chain,” Fredericks said.
“One of the biggest things we have our eyes on is nearshoring. The growth in trade between Mexico and the U.S. and Canada has been pretty remarkable in the last couple of years. We think that with all the foreign direct investment moving into Mexico, that nearshoring is not going to change. Right now, we just don’t see enough technology being built to streamline logistics between Mexico and the U.S. We’re really excited about the broader vision of just streamlining North American logistics into a platform where a lot of the complexity and pain of finding new parties to do business with for transportation is simpler and results in less cost.”
Silver said the seed funding will be invested in more data engineers, as well as additional sales, accounting and support staff. Cargado currently has about half a dozen employees, based in Chicago, Atlanta, Seattle and Laredo, Texas.
Silver said Cargado’s headquarters will be in Chicago and the company plans to open an office in Monterrey, Mexico.
Cargado actually launched its still-unrevealed product about a month ago to its growing roster of customers and users.
“The feedback has been exceptionally positive. One of the comments that we’ve heard a lot has been that the product is built in an intuitive way,” Silver said. “I’ve spent 17 years in freight. Rylan was at Convoy for seven and a half years, so we have a really good understanding of the ins and outs of freight, and what an operator needs to be able to do and communicate in the information that they want to be able to store and share. We were very intentional about making sure that it was built that way.”
Eddie Valdez
I’m not sure what Cargado will do different. I’ve been in Laredo for 30+ years in transportation and logistics. Its a fairly simple process to move cross border cargo with the right partners in Mexico/Laredo. Not sure if reinventing the wheel is necessary.
Mark Stephens
The Supply Chain Pendulum Swing
An observation by Mark Stephens
Volume capacity. Outbound tender volumes. Spot market rates. These are but a few terms used in the trucking industry within the United States supply chain.
As with any cost to profit business, supply and demand remains the critical constant by which one makes predictive analysis.
In a balanced market, freight movement compares nicely to trucking capacity. In today’s current market, we find ourselves in a conundrum as such. Where supply is abundant, so too are empty trailers whose movement depends on quick timing and flexible negotiated compromising techniques by planners and dispatchers.
Pre-pandemic figures categorize nicely into the predictive ebb and flow of the pendulum swing in the supply chain (the range of profit margins targeted and often surpassed within the supply chain)
The supply and demand formula was interrupted during this time due to unpredictable consumer buying phases. Production plants, distribution centers and off market third party logistic warehousing begin over ordering and quickly filling beyond maximum capacity. This exasperated increase to the normal pendulum swing was a primary effect of rate escalation.
As a retired history teacher, I do recall 19th century philosopher George Santayana’s century old adage, “by not knowing relative history, there’s an excellent chance of repeating similar failure.” Doomed or condemned I believe was the operative adjective used.
The trucking capacity grew at an alarming scale, yet the demand to move product remained the carrot to the thoroughbred. Rates were at their highest ever measured and the pendulum needle could not have reached any further than it did before the adverse effect began.
By the time carriers had received their pre-ordered trucks and trailers in 2023 the reflux of the pendulum began moving in favor of the shipper and receiver (customer) where it currently lies, albeit in a slow decline.
Trucking capacity is still extremely high in spite of some of the lowest rates offered and agreed upon. Add that to the rise in fuel cost in 2023, the supply chain industry saw a devastating rise in carrier and broker bankruptcies with thousands going out of business.
Many analysts predict a back to pre-pandemic normality this year. That’s “hopeful” thinking. Bizlytics predicts the spring of 2025 to measure closest to pre-pandemic volumes.
If an agreement was achieved to neutralize the influx of supply chain movement through supply and demand predictives and attainable profit margins would fall in a satisfactory target range the survival of all participants would become a reality; at least until the next pandemic.
Technology is moving along quite well. AI is becoming a more understood ally to the supply chain partnerships and those who exercise that technology will transcend to the top and to those who let’s say wing it, on their instincts, well let us not forget Dr. Santayana’s famous quote.
Mark Stephens
Founder & CEO
Bizlytics TGMS
~ a Solutions Software ~
Brokerage Bros
Guessing this will be a marketplace for cross border movements focused on Mexico that will turn out to be a load board.