Hot off a $3.67 million seed round, supply chain Internet of Things (IoT) startup CargoSense is catching fire with its disruptive tracking software.
Founded in 2013 by CEO Richard Kilmer, Reston, Va.-based CargoSense’s technology is used to track the conditions and location of high-value packages while they are transported. The company’s software platform takes in data from internet connected sensors to provide insight that allows clients to know exactly whats going on with their products from when they leave the factory to when they arrive at the customer’s door.
Chief marketing officer Craig Montgomery tells DC Inno that CargoSense has “tripled in both revenue and customer numbers since 2014.” Many of CargoSense’s clients are multi-billion dollar firms in the pharmaceutical and logistics spaces.
“The top 10 players in the Pharma space are pulling in roughly $325 billion in revenue annually but they are also losing $35 billion from damaged and/or lost products in their supply chains. The opportunity is there,” Montgomery said.
The 8-person logistics startup has doubled in number of employees since 2014, Montgomery said, and recently added two key roles that focus on marketing, product management and complex analytics modeling.
In the next twelve months, CargoSense expects to double their employee headcount and triple current revenue output while also doubling the amount of clients to which it sells products.
Montgomery declined to name the startup’s current clients or a total count, but said that “75 percent of our [CargoSense] customers are focused on healthcare/pharmaceuticals. The remaining 25 percent are focused on logistics as their core business.”
“The [IoT] industry has just begun to explode in terms of technology”
CargoSense’s software is “hardware agnostic” and will let clients effectively monitor the status of packages. It is basically one very large API with smaller modules that users can adhere tools to/from. The data mined via the platform is extremely detailed in comparison to the market standard established by aging competitors, Montgomery explained, as it provides information regarding everything from barometric pressure (related: flight travel), shock damage and temperature to potential tampering that can occur during a trip.
In addition, while this sort of tracking technology has existed, CargoSense believes that few can match the same depth of data its platform can extract.
In 2015, CargoSense was recognized alongside leading corporate Internet of Things (IoT) product developers like Cisco Systems, Vodafone and Trimble Navigation with an IoT Asset Tracking Award by IoT Evolution Magazine. The award honors excellence in innovation utilizing IoT tech to automate tracking functions.
“There is simply no other company in the market today that can provide the level of insight and actionable intelligence that our platforms delivers. Although specific competitors may arise, their solutions are likely to be very niche and unable to scale to the depth and breadth that our platform is designed to achieve,” Montgomery told DC Inno.
CargoSense’s $3.67 million seed round was led by the CIT GAP fund, New Dominion Angels and Irish Angels, among other unnamed angel investors.
The seed round, Montgomery explained, was originally closed in April 2014 after quickly accumulating $2.5 million but was then later reopened in July 2015 when two ardent individual angel investors committed $1 million. The $1 million at the end was an over-subscription to the seed round.
Montgomery accredited the unusual investment history to the fact that CargoSense is “not your typical seed company,” as the startup is already selling a deployed, 4th generation product.
Though CargoSense’s growth has, to a degree, proven its promise, the maturation of a specific piece of FDA legislation by President Obama may also take the startup to another level, Montgomery said.
Signed into law in 2011, the FDA Food Safety Modernization Act (FSMA) was previously called one of the most “sweeping reforms of our food safety laws in more than 70 years.” Interestingly, the bill sets very specific shipping standards into place, among other things, when it comes to the conditions of food during transport. As a result, major food labels are exploring ways to monitor the status of shipments in order to ensure the quality of their shipments and also avoid new federal penalties.
“The [IoT] industry has just begun to explode in terms of technology,” Montgomery said.
Later this fall, CargoSense will look to close a Series A funding round that will more than likely include institutional investment, Montgomery told DC Inno.