Portfolio Profiles: CargoSense
Meet the Kiddar portfolio company using IoT to transform the logistics industry.
Logistics is the largest market in the world when measured by global annual revenue, earning $8 trillion in 2015 — nearly half the size of the U.S. GDP the same year — and projected to grow 7.5% per year through 2023. It’s also been a hotbed for consumer technology breakthroughs from juggernauts like Uber, Amazon, Mercer, and FedEx.
Thanks to the rise of the Internet of Things (IoT) and machine learning, a new breed of startups is poised to solve pervasive problems on the enterprise side of logistics, including a lack of data, supply chain complexities, and poor accountability.
CargoSense is one of those companies. Founded by the RubyGems software creator Rich Kilmer, CargoSense uses machine intelligence to manage supply chain logistics, slashing shipping costs and ensuring that cargo arrives in one piece and unspoiled.
The startup is addressing the $12 billion market opportunity of cold-chain transportation, mainly in the pharmaceutical and food industries. The massive pharmaceutical industry loses $35 billion worth of product in transit every year. As temperature or shock-sensitive biologicals and speciality drugs continue to increase in popularity, that number is only growing. The food industry in the United States relies on cold-chain to transport 70% of its product, 25% of which is spoiled due to problems in the supply chain.
The logistics industry currently addresses these problems by paying for root cause analyses, which are expensive, manual, and occasionally inconclusive or inaccurate.
The CargoSense system uses a system of sensors and beacons across cargo crates and warehouses to provide a full trace of what happens to shipments. Their Black Box sensors, made in partnership with Toshiba, record temperature, humidity, shock, light, and tilt, and have batteries lasting 2–4 months. Every part of the journey is tracked.
Then, the CargoSense software takes that information and provides a full analysis. If there’s an issue, it’s easily evident when, where, and why it happened.
Kiddar Capital invested in CargoSense in May 2016. The firm’s experience across logistics-heavy industries enables them to provide guidance and bolster the startup’s pipeline.
“It’s the perfect time for CargoSense to hit the marketplace,” says Cheryl Foil, Principal of Kiddar’s Venture Group. “IoT devices are cheaper and more ubiquitous than ever before, and the pharmaceutical and food industries are facing pressure from regulations. CargoSense offers a painless and efficient way for them to prevent losses and ensure the quality of their product.”