How bad communication costs logistics $1 trillion

This article summarizes an episode of Joe Lonsdale’s video series featuring co-founder and CEO of Augment Harish Abbott.

CEO of Augment Harish Abbott / Photo credit: Augment

The trillion-dollar opportunity in logistics is not about optimizing physical assets. It is about eliminating the immense waste from asynchronous human communication. Harish Abbott, co-founder and CEO of Augment, argues this fundamental communication gap can now be solved directly with AI. Abbott is pioneering this shift by deploying AI agents to serve as the industry’s connective tissue.

Abbott helped build Amazon’s fulfillment technology before selling his company Deliverr to Shopify for over US$2 billion. His current venture, Augment, recently announced that it raised an US$85 million Series A just five months after a hefty US$25 million seed round.

This new capability transforms AI from a strategic choice into an operational necessity. As AI automates complex communication, the companies that thrive will be those that use it to build a more efficient and responsive foundation.

Logistics is an information trading problem

AI’s competitive advantage comes from its ability to solve the industry’s core inefficiency. Abbott believes logistics is about trading information to enable the movement of goods, and its fragmentation makes this exchange difficult.

Logistics is defined by information flow
Abbott says, “logistics in its simplicity is about trading information so you can trade goods, right? Two companies, whether you are a warehouse or a truck or you’re a shipper or a broker…you’re trading information.”

The industry is structurally fragmented
Abbott explains, “[there are] 1 million truck driving companies in America. There are 40,000-50,000 trucking brokerages in America. So there’s just a lot of fragmentation in this space.”

Asynchronous communication creates massive waste

This fragmentation forces reliance on slow, asynchronous communication like email and phone calls, a flaw that results in costly operational failures. Abbott sees this waste as an economic opportunity for an AI-driven solution.

Inefficient communication is the root of waste
Abbott states, “because the trading of information is all through these asynchronous low bandwidth methods, it creates a ton of waste…we think there’s about at least 10% waste in this industry because of the low bandwidth asynchronous communication nature of trading information.”

This inefficiency creates billions in tangible waste.
Abbott illustrates, “a truck waiting for a whole night is a few hundred dollars wasted. You multiply that by 3.5 million trucks, and at least 10% of them are just laying over the night because the information couldn’t get communicated. They couldn’t get a new appointment and the amount of waste is so high.”

This waste represents a massive market
Abbott notes, “so that’s a US$300 billion opportunity in the US, almost a trillion dollar globally. Rethinking logistics and reducing waste from this industry is what sort of drives me.”

The AI agent is the new teammate

AI agents, or software designed to perform tasks autonomously, are becoming operational partners in logistics. These AI teammates handle multimodal communications around the clock. This automation frees human employees from coordination to focus on higher-value work like strategy and customer relationships.

AI agents are built for multimodal, 24/7 operations
Abbott explains, “basically what we’re building is a teammate called Augie. It works 24/7. It can handle emails and text and phone calls and Telegram or any other means of communicating.”

Amazon’s framework for operational excellence