Once Worth $3.8B, Convoy’s Future Now in Doubt

Digital freight brokerage Convoy, which only last year raised $160 million in a funding round that valued the company at $3.8 billion, appears to be winding down operations.

Multiple media reports on Wednesday have indicated the company is facing an immediate decision on its future. In a statement released to the Seattle Times, the company has said it is “preparing our business for a transition, and we will have more information in the next 48 hours.” Multiple reports indicated it has cleared its load board of all freight.

Supply Chain 247 has reached out to Convoy for comment on the situation, as well as the current situation with shippers’ freight in its network, but as of publication time, the company had not responded.

Founded in 2015 by Grant Goodale and Dan Lewis, the company has gone through a series of layoffs that have cut its staff from more than 1,500 to a reported 500 to 700 employees. Goodale stepped down in June.

In April 2022, Convoy raised $260 million in new funding, comprised of a $160 million Series E preferred equity round led by Baillie Gifford and funds and accounts advised by T. Rowe Price Associates, Inc., as well as a $100 million venture-debt investment from Hercules Capital, Inc. The company also secured a $150 million line of credit from J.P. Morgan. It has raised over $900 million. 

Investors include Bill Gates and Jeff Bezos as well as Generation Investment Management, Fidelity, Durable Capital Partners, Capital G, Lone Pine Capital, Greylock Partners, Y Combinator, Salesforce CEO Marc Benioff, Code.org founders Hadi and Ali Partovi and U2’s Bono and The Edge. 

Convoy has continued to push innovation in the broker space – announcing a just-in-time delivery guarantee window of 15 minutes in August – but brokers have been hit particularly hard this year as the freight market resets after COVID and supply chain disruptions, and an economy that has slowed from the red-hot market of the past few years.

The Information, in August, reported Convoy had hired an investment firm to explore its strategic options, which included seeking more funding or a possible sale. The venture capital market has collapsed this year and companies have struggled to raise funds.

In its 2022 funding announcement, Convoy touted having 400,000 trucks on its marketplace and included top shippers Home Depot, Procter & Gamble, Unilever and Anheuser-Busch among its customers.