Cargamos Raises $11M Seed Round for Same-Day Delivery Expansion
Cargamos Secures $7 Million to Expand Last-Mile Delivery Network in Latin America
Based in Mexico City, Cargamos, a last-mile logistics platform, is focused on dominating the same-day delivery sector throughout Latin America. The company has recently announced a further $7 million in funding as part of its seed round, increasing the total raised to $11 million.
Investment to Fuel Nationwide Warehouse Network
These newly acquired funds will be strategically allocated towards the development of a nationwide network of distributed warehouses. This infrastructure is designed to empower regional retailers to effectively compete with industry giants such as Amazon.
Expansion of Fulfillment and Delivery Infrastructure
Cargamos plans to construct a substantial fulfillment center within Mexico City. Simultaneously, the company intends to broaden its network of mini distribution centers, referred to as “pods,” which serve as crucial sorting and dispatch points for final delivery.
Currently operating approximately 50 pods, Cargamos aims to more than double this number within the next six months. This expansion will extend its service coverage to encompass up to 75 additional cities surrounding Mexico City, as stated by Ivan Ariza, the founder and CEO of Cargamos.
Second Attempt Capitalizes on E-commerce Growth
Although founded in 2019, Ariza revealed that this represents his second venture into the last-mile logistics space. A previous attempt around 2013 was unsuccessful due to the then-limited popularity of e-commerce in the region.
Now, Latin America is poised for significant e-commerce expansion. Americas Market Intelligence (AMI) forecasts a 29% growth in e-commerce volume between 2020 and 2024, projecting a market size of $580 billion, with Mexico and Brazil leading this growth.
Addressing Logistics Challenges in Mexico
“The core issue in Mexico lies in the optimization and coordination of logistics,” Ariza explained to TechCrunch. “Existing networks are fragmented and lack modern technology. We believe e-commerce is viable, but a significant barrier in Latin America is the high cost and complexity of logistics, particularly for lower-income individuals. This is where Cargamos steps in.
Our goal is to accelerate delivery speeds and reduce costs across the region, thereby facilitating broader e-commerce access throughout LATAM.”
Serving Major Retailers and Expanding Reach
Cargamos currently collaborates with three of Mexico’s largest retailers, including Liverpool, the country’s leading department store chain, as well as the top 50 companies operating e-commerce channels within Mexico.
The planned fulfillment center will enable Cargamos to extend its services to smaller and medium-sized businesses lacking their own fulfillment capabilities, fostering further e-commerce growth in Mexico.
Cloud-Based Platform for Optimized Logistics
Retailers can integrate with Cargamos’ pod network through its cloud-based software platform. This platform provides intelligent routing capabilities and a comprehensive overview of the entire logistics process, from fulfillment to the customer’s doorstep.
Strategic Pod Locations for Quick Commerce
Cargamos establishes its pods in underutilized spaces within parking garages and shopping malls, strategically positioning them in urban areas to minimize delivery distances. This enables “quick commerce,” offering delivery times of approximately two hours.
The company maintains its own fleet of delivery vehicles and drivers, while also allowing third-party carriers to connect to its network via the platform.
Commitment to Sustainable Delivery
Cargamos reports that 25% of its delivery fleet consists of zero-emission vehicles, including electric cars, bicycles, and electric motorcycles. The company claims that its eco-friendly transport methods and multiple pod locations collectively reduce the carbon footprint of each package by 80%.
Future Expansion Plans
Alongside its national expansion plans, Cargamos has announced intentions to enter the U.S. and Colombian markets in the medium to long term. Investors in this seed round include Carlos Garcia Ottati (CEO and founder of Kavak), Ricardo Weder (CEO and founder of Jüsto), Guilherme Bonifacio (founder and COO of Mercê do Bairro), and venture capital firms such as Nazca, FEMSA, and Kayyak Ventures.
