Convoy, a Seattle-based digital freight booker with investors that include billionaires Bill Gates and Jeff Bezos, announced Thursday it would be shutting down, according to Bloomberg, after the company failed to find a buyer amid a “massive freight recession.”
Chief executive Dan Lewis said a “massive freight recession” might have contributed to the company's ... [+]
Convoy’s founder and chief executive Dan Lewis notified employees in an internal memo Thursday that “today is your last day at the company,” noting the company is “exploring and evaluating strategic options for what might come next,” Bloomberg reported.
Lewis said the company had evaluated potential suitors to acquire it, though “none of the options ultimately materialized into anything sufficient to keep the company going in its then current form.”
Convoy was in “the middle of a massive freight recession and a contraction in the capital markets,” according to Lewis, who added “this combination ultimately crushed our progress” and likely swayed potential suitors away from acquiring the firm.
FreightWaves, an industry trade publication, reported Thursday that some Convoy employees indicated they were not offered severance, though benefits would be available through the company until the end of the month.
Convoy did not immediately respond to a request for comment from Forbes.
“Following an exhaustive process, spanning many, many months during which we explored all viable strategic options for the business, the result is where we are today,” Lewis wrote.
$3.8 billion. That was Convoy’s estimated valuation by investors as of April 2022. As of that estimate, the company had raised $925 million.
Convoy, an online platform that connected truck drivers with freight companies, was founded in 2015 by Lewis—a former Amazon executive—in an effort to prevent trucks from driving “empty miles” without loads. The company received investments through Gates, Bezos, Al Gore’s Generation Investment Management, Scottish investment firm Baillie Gifford and T. Rowe Price, among others. An announcement that Convoy would shut down its operations follows an announcement on Wednesday that the company had canceled all of its shipments, FreightWaves reported. Convoy began exploring a potential sale in August, and possible suitors ranged between Walmart, Amazon and Maersk. Other freight companies have been impacted by decreased demand for shipping, according to Bloomberg, including San Francisco-based Flexport, which announced earlier this week it would cut 20% of its staff.
Bezos-Backed Startup Convoy Closes Operations With No Buyer (Bloomberg)