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Contxto – Less than one-year old and Ecuadorian freight forwarding and customs broker startup Nuvocargo has already made its first acquisition: Oncarriage. The latter is a customs broker and logistics provider based in Atlanta. They didn’t disclose the value of the transaction.
Nuvocargo’s objective with the acquisition was clear: snag government licenses, including a customs broker license. This is a key validating document for managing trade with the United States. But it usually takes up to three years to obtain. Not to mention it has a really tough screening process.
So why wait and delay growth? Thanks to its purchase, the startup reports it’s grown at a rate of 70 percent month-over-month.
Nuvocargo acquired Oncarriage around 10 or 11 months ago. Nonetheless, the startup barely made the announcement last Thursday (12).
Nuvocargo’s Ecuadorian roots in NYC
Founder/CEO, Deepak Chhugani’s father is from India, but he was born and raised in Ecuador. During his upbringing, he witnessed logistics operations first-hand.
“I grew up in Ecuador; my Spanish is better than my English,” said the executive, in an interview with Freight Waves.
“I grew up in a logistics family. My dad, in his late twenties, left India to move to Ecuador to start a small logistics business that was helping Latin American retailers find suppliers abroad, and then move the goods and then finance them.”
Although Chhugani’s initial approaches in entrepreneurship had little to do with logistics. He’d originally founded a startup to connect job applicants with key people within financial institutions.
But as many entrepreneurs before him, he pivoted.
And as of August 2019 from its New York City headquarters, Nuvocargo has been developing software to ease the process of moving goods between Mexico and the United States.
From paperwork, customs issues, updates, this startup wants to tackle it all. What’s more, this Nuvocargo has received backing from key players from the startup ecosystem including Y Combinator and unicorn Rappi’s co-founders.
Turning the tables on US-Mexico trade
I’ve seen my share of “all-encompassing” startups that offer freight forwarding solutions. However, it’s interesting to note that this is the first I’ve found that’s specifically targeting trade between the United States and neighboring Mexico.
Making the most of its team that’s in both countries will surely come in handy to provide Nuvocargo with the specialized insights it needs.
And ultimately, the startup aims to be the digital solutions-provider for all things in Mexico-US trade. And with Canada’s recent approval of the United States–Mexico–Canada Agreement (USMCA), things look promising for Nuvocargo.
Even with all these trade slowdowns because of the infamous coronavirus, or COVID-19.
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