Modernizing Cross-Border Freight with Digital Logistics

Despite the substantial volume of trade – amounting to hundreds of billions of dollars annually – between the U.S. and Mexico, the freight sector has largely remained reliant on traditional, manual processes. Each side of the border presents its own complex set of bureaucratic hurdles.

Introducing Nuvocargo: A Unified Platform

Nuvocargo is a digital logistics platform designed to streamline cross-border trade. The company aims to modernize operations by providing an all-inclusive service. This encompasses freight forwarding, customs brokerage, cargo insurance, and even trade financing, all integrated within a user-friendly software and mobile application.

According to Nuvocargo CEO Deepak Chhugani, consolidating these services into a single platform simplifies supply chain tracking. It also grants customs and logistics teams access to more centralized data.

Enhanced Transparency and Cost Reduction

“A unified audit trail is created, which is invaluable should any issues arise,” Chhugani explained to TechCrunch. He further noted that this approach helps to minimize or eliminate the additional expenses associated with high administrative overhead.

The platform also provides customers with a comprehensive overview of their operations through a single, intuitive interface.

A Familiar User Experience

Chhugani draws a parallel to services like Uber Eats, where customers can easily monitor their food orders from preparation to delivery.

“When dealing with numerous parties, maintaining visibility can be challenging. Obtaining a complete picture of end-to-end spending often requires sifting through extensive email exchanges, faxes, and text messages with various providers,” Chhugani stated. “Some of these providers may be located in different countries. Nuvocargo enhances visibility throughout the entire process, pinpointing the location of goods and providing financial insights.”

Expanding Beyond Transportation

Nuvocargo’s vision extends beyond the physical movement of goods. The company is now offering customs brokerage services, comprehensive cross-border cargo insurance, and factoring – a form of short-term accounts receivable financing.

Factoring addresses a significant challenge for trucking companies, which frequently face payment delays of up to 90 days.

Securing Series A Funding

The company’s innovative approach has attracted significant investment. Approximately one year after a $5.3 million seed round, Nuvocargo has secured $12 million in Series A funding. This round was led by QED Investors, with participation from David Velez, Michael Ronen, Raymond Tonsing, FJ Labs, and Clocktower. Existing investors NFX and ALLVP also contributed.

The Potential of Trade Financing

Chhugani identifies trade financing as the “holy grail” of their expanding offerings. By establishing relationships with companies and assessing credit and fraud risks, Nuvocargo aims to provide financial products at competitive rates.

Attracting Fintech Investment

This potential is what drew the attention of QED Investors, a firm primarily focused on financial technology.

“After discussions with Deepak and recognizing the similarities between e-commerce challenges and the complexities of cross-border goods movement, the fintech potential became clear,” explained Lauren Connolley Morton, a partner at QED, in an interview with TechCrunch. “Opportunities in factoring, lending, and goods insurance align perfectly with our expertise.”

Future Growth in a Fragmented Industry

While Chhugani did not disclose Nuvocargo’s valuation following the latest funding round, the company clearly has substantial potential for growth within the expansive and fragmented logistics industry.