Canadian DRT provider Argo closes $7.1 million funding round to expand Smart Routing network

On-demand transit solutions provider Argo has closed a CAD 10 million (approximately US$7.1 million) private placement to support the expansion of its Smart Routing transit network and further technology development.

The Canadian mobility company announced the completion of a non-brokered private placement with long-term institutional investors, including a pension fund, raising CAD 10 million (US$7.1 million). The proceeds will be used to expand Argo’s Smart Routing transit network, fund research and development, and support working capital.

Argo collects 7 million dollars

Under the transaction, Argo issued 33.3 million common shares at CAD 0.30 per share. The private placement remains subject to final acceptance by the TSX Venture Exchange.

The company states that it has recently signed agreements with three municipalities in Ontario. In Bradford West Gwillimbury, Argo replaced the local bus network, with average daily ridership more than doubling within two months and cost per ride falling by more than half. The project was launched in April last year. In Brampton, the company is extending the city’s fixed-route network through a contract worth approximately $7.7 million annually, while in Caledon, still according to the supplier itself, it is launching the municipality’s first local transit service under an agreement valued at approximately $3.2 million over 15 months.

What is Argo? According to expert Lukas Foljanty‘s “On-Demand Transit 2024 Market Report“, Argo stands among the most interesting new launches expected from the DRT market in 2025 as it promises to make public transit […] faster than driving a car but as affordable as taking the bus“.

Well, in the company’s own words, Argo “combines electric vehicles and smart-routing technology to create better public transit. Residents can book door-to-door rides through an easy-to-use mobile app, with guaranteed connections to GO trains and local buses. The system adjusts to demand in real-time, reducing wait times and making transit more reliable than driving”.

Argo was founded by former leaders from Tesla, Uber, and other top tech companies. Since September 2024, Argo School has successfully provided transportation for a series of Greater Toronto Area (GTA) private schools.

Back to the today-announced strategic investment, Praveen Arichandran, Co-founder and Chief Executive Officer of Argo comments: “This investment gives us the capital to execute our expansion plans in Canada and pursue opportunities in the United States and internationally through our capital-efficient scaling model. It also brings on board long-term institutional shareholders who share our conviction in Argo’s opportunity to transform public transit and intend to support the Company as it grows.”