By Nancy Dahlberg
PayCargo, a payments network for the global supply chain industry, announced it has raised $35 million in financing led by venture capital firm Insight Partners.
The logistics-tech startup based in Coral Gables said it will l use the capital to expand global adoption of its electronic payments network and accelerate investment in its technology.
The funding is PayCargo’s first insititutional round. The company was co-founded by COO Juan Carlos Dieppa and Chairman Sergio Lemme in 2006. It now has about 60 employees and has offices in Madrid and Amsterdam, Crunchbase reported.
"This investment will allow us to expand our network of customers and continue to make PayCargo the best place to transact electronically," said Eduardo Del Riego, Global PayCargo’s CEO, in a statement. "We are excited to continue supporting our customers and building new tools to achieve our mission of improving the speed and profitability of our freight customers' businesses."
PayCargo's cloud-based solution enables payers to quickly and securely pay air and ocean carriers, maritime ports, ground handlers, freight forwarders and customs brokers. This allows for faster cargo release, elimination of inefficient manual processes and fees, improved transparency, cash flow management, as well as streamlined invoicing and account reconciliation, the company said.
The COVID-19 crisis has rapidly accelerated adoption of electronic payments in the cargo market, and PayCargo has experienced rapid growth. PayCargo recorded over 80% transaction volume growth over the past year – with customers including DHL, UPS, MSC, Ocean Network Express, AirFrance and others -- and it has been profitable since inception, the company said. With some 4,000 vendors on the platform, PayCargo has helped process over $2 billion in payments in 2019 and is on track to process $4 billion in 2020.
But there's a huge market to tap in the antiquated logistics industry. While CrunchBase estimates that $5.5 billion has been invested in shipping-related tech companies, the shipping logistics market in the U.S. alone could hit $1.3 trillion value by 2023, according to forecast by InXpress.
"As the cargo industry rapidly shifts to electronic payments, PayCargo has established itself as the market leading platform for doing business by successfully automating the payments process and ensuring efficiency for both payers and vendors," said Ryan Hinkle, Managing Director at Insight Partners, who will be joining PayCargo's Board. "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."
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