Kargo, a developer of artificial intelligence technology for warehouse and logistics operations, has closed a $42 million Series B funding round to accelerate deployment of its automated inventory tracking system across global supply chains. The round was led by Avenir, with participation from Linse Capital, Hearst Ventures, Lightbank, and returning investors Matter Venture Partners and Sozo Ventures.
Explosive Growth in Enterprise Adoption
The fundraise comes as warehouses worldwide grapple with labor shortages, rising operational costs, and increasing demands for real-time visibility across complex supply chains. Kargo’s platform addresses these challenges by transforming loading docks into sources of accurate, automated data without requiring manual scanning or significant workflow changes.
Since completing its Series A round in 2022, Kargo has experienced remarkable expansion in its enterprise customer base. The company has grown from serving just three clients to partnering with more than 45 organizations, including several Fortune 500 companies across diverse industries.
Notable customers span the food and beverage sector (Wayne-Sanderson and Tillamook), pharmaceuticals (Aurobindo), and automotive manufacturing (Mercedes-Benz). This diversification demonstrates the platform’s applicability across industries with vastly different operational requirements and compliance standards.
The company has deployed over 1,000 physical towers across customer facilities nationwide, creating a growing network of interconnected data points throughout supply chains. According to CEO and founder Sam Lurye, this deployment scale reflects a powerful network effect inherent in Kargo’s solution.
“Once Kargo sensors are deployed in a warehouse, customers want Kargo upstream and downstream in their supply chain,” Lurye explained. “We typically see additional orders by the same customers within three months because the data accuracy is recognized immediately and the ROI is often realized in weeks.”
The company’s revenue trajectory supports these claims, with annual revenue tripling between 2024 and 2025. That growth rate significantly outpaces the broader market, positioning Kargo as one of the faster-growing players in warehouse automation.
How the Technology Works
Kargo’s system centers on physical towers and lifts installed at warehouse loading docks and gateways. These hardware units contain sensors and cameras that connect to Kargo’s cloud-based platform, creating an automated inspection and tracking system that operates without human intervention.
When freight arrives, the system automatically inspects shipments for visible damage, verifies contents against Bill of Lading documentation, and pushes inventory data directly into customers’ existing warehouse management systems. This happens in real time, providing immediate visibility into what’s entering or leaving facilities.
Any discrepancies or issues are flagged instantly and documented with photographic evidence, enabling logistics teams to resolve freight claims efficiently while maintaining detailed records for disputes. This visual documentation has proven particularly valuable for resolving conflicts with carriers and suppliers, where proof of condition at delivery time can be critical.
Beyond inspection, the platform consolidates multiple operational workflows into a unified system. Scheduling, driver check-in, and dock door allocation are managed through a single interface that automatically adapts to changing conditions such as weather delays or unexpected shipment arrivals. This allows warehouse managers to make informed decisions about labor allocation and operational priorities in real time.
Investor Perspective on Market Opportunity
Jared Sleeper of Avenir, who led the Series B round, characterized Kargo as “a category-defining company” addressing challenges that have plagued supply chains for decades. He noted that previous technology paradigms have attempted to solve supply chain visibility problems but struggled with adoption due to requirements for standardization or expensive custom hardware.
“Kargo’s unique ability to provide individual value to every node in the chain is the winning formula,” Sleeper said. “Instead of trying to force everyone onto the same standard or relying on heavily custom hardware solutions, they are introducing a universal interpretation layer that benefits every supply chain player while de-risking and simplifying deployments.”
Sleeper emphasized that during the firm’s due diligence process, every stakeholder interviewed confirmed measurable value from Kargo’s implementation. The universal enthusiasm for the solution reinforced Avenir’s thesis that deeply integrated AI-powered infrastructure plays represent compelling investment opportunities.
Booming Market for Warehouse AI
The warehouse automation market is experiencing rapid expansion driven by labor shortages, rising consumer expectations for fast delivery, and increasing supply chain complexity. According to Grand View Research, the global AI in warehousing market is projected to grow from $11.22 billion in 2024 to $45.12 billion by 2030, representing a compound annual growth rate of 26.1%.
This growth reflects warehouses’ urgent need for faster, more accurate automation and real-time decision-making capabilities. Traditional manual processes increasingly cannot keep pace with the volume and velocity of modern logistics operations, particularly in e-commerce-driven environments where same-day or next-day delivery has become table stakes.
Labor challenges further accelerate adoption. Warehouse work has long suffered from high turnover, and the pandemic exacerbated recruiting difficulties across the logistics sector. Automation technologies like Kargo’s reduce dependence on manual labor for repetitive, error-prone tasks while allowing human workers to focus on higher-value activities requiring judgment and problem-solving.
Expanding Into Agentic AI Applications
Looking ahead, Kargo plans to build additional applications on top of its proprietary data layer. The company is rolling out Kargo Intelligence, which leverages advances in agentic AI to automate back-office workflows including invoicing, claims disputes, financial reconciliation, and customer service.
These applications will be powered by the high-quality visual data captured by Kargo’s camera systems, providing what the company calls “crystal clear” documentation to support automated decision-making. This represents a significant expansion beyond Kargo’s current focus on dock operations into broader enterprise resource planning and financial operations.
The move into agentic AI, where systems can take autonomous actions based on predefined rules and objectives, positions Kargo to capture more value from each customer relationship. Rather than simply providing data visibility, the company aims to automate the operational and financial workflows that currently require human review and decision-making.
Competitive Landscape and Differentiation
The warehouse automation space has attracted numerous competitors, from established players like Zebra Technologies and Honeywell to startups pursuing various approaches to visibility and automation. What appears to differentiate Kargo is its focus on retrofitting existing infrastructure rather than requiring wholesale facility redesigns.
The company’s ability to integrate with existing warehouse management systems and adapt to current workflows reduces implementation friction and accelerates time-to-value. This practical approach has enabled rapid customer acquisition across industries with different operational requirements and technology stacks.
The network effect Lurye describes, where customers expand Kargo deployments both within facilities and across supply chain partners, creates potential competitive moats. As more nodes in a supply chain adopt Kargo, the data becomes more valuable to all participants, creating incentives for additional adoption.
What’s Next
With $42 million in fresh capital, Kargo faces the challenge of scaling operations while maintaining the implementation speed and customer satisfaction that have driven its growth. The company will need to build out its sales, implementation, and support teams to serve a rapidly expanding customer base across diverse industries and geographies.
The planned expansion into agentic AI applications represents both an opportunity and a risk. Successfully executing on this vision could significantly increase revenue per customer and strengthen competitive positioning. However, it also moves Kargo into more complex territory involving financial systems and workflows where errors carry greater consequences.
For the warehouse automation industry, Kargo’s success provides validation that practical, incrementally deployable solutions can achieve rapid adoption even in traditionally conservative logistics operations. As labor challenges persist and supply chain complexity continues growing, technologies that deliver measurable ROI without requiring operational transformation will likely continue attracting both customer and investor interest.
