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Warburg Pincus puts $35 million into start-up targeting dray/short-haul market

Trucks at the Port of Los Angeles. (Photo: Port of Los Angeles) 

Cargomatic aims to connect carriers and shippers.

Cargomatic has raised $35 million in its second round of financing as the Los Angeles-based start-up goes after the market for drayage and short-haul trucking.

The now five-year old company scored the new financing from Warburg Pincus, the private equity giant with some $45 billion in assets under management.

Cargomatic had already raised $8 million in its first funding round. Among the venture capital shops that have a stake in Cargomatic are Volvo Group Venture Capital, Canaan Partners, Morado Venture Partners, Structure Capital, SV Angel and Sherpa Capital. 

Short-haul rail company Genesee & Wyoming also invested in and formed a strategic alliance with Cargomatic. 

Cargomatic aims to provide an online and mobile phone-based market for dray and short-haul truckers to connect with shippers. 

Shippers can post bids on the Cargomatic platform, which drivers can accept or reject. Using GPS technology, carriers can view where their trucks are and provide the information to  shippers through an electronic data interchange with desktop and mobile applications. 

The company’s test bed was in the Port of Los Angeles. In 2015, the Port agreed to use the Cargomatic platform for dray movements out of the West Basin Container Terminal. Cargomatic provided data to ensure dray drivers were licensed and insured. 

It has also launched service in the San Francisco/Oakland and New York markets. 

Cargomatic was co-founded by Brett Parker, whose prior experience was as managing partner at the privately held warehousing-and-logistics firm Triangle Group, and Jonathan Kessler, former chief executive of interactive video firm Hand Eye Technologies. 

Cargomatic’s chief executive Richard Gerstein spent 22 years at IntelliTrans, the inventory tracking and transportation management unit of Roper Technologies.

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Michael Angell, Bulk and Intermodal Editor

Michael Angell covers maritime, intermodal and related topics for FreightWaves. His interest in transportation stretches back several generations. One great-grandfather was a dray horseman along the New York waterfront and another was a railway engineer in Texas. More recently, Michael has written about the shipping industry for TradeWinds, energy markets for Oil Price Information Service, and general business topics for FactSet Mergerstat and Investor's Business Daily. When he is not stuck in the office, he enjoys tours of ports, terminals, and railyards.
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