Convoy

Convoy was founded in 2015 in Seattle by Dan Lewis and Grant Goodale, two former Amazon employees (Lewis had also previously worked as a group product manager at Microsoft from 2008-2011). The company set out to digitize the fragmented, analog U.S. trucking brokerage industry — historically run over phone calls and faxes — by building an automated marketplace that matched shippers' loads with available trucks, using data and machine learning to chain backhauls together ('automated reloads') and reduce the roughly 40% of miles trucks drove empty. Convoy quickly attracted attention from Seattle's tech and Amazon ecosystem, raising a $15 million Series A led by Greylock Partners in March 2016 — Greylock's first and largest early institutional bet on the company, with participation from prominent individual backers including Jeff Bezos, Marc Benioff, Pierre Omidyar, Henry Kravis, and Reid Hoffman.

Convoy's growth accelerated rapidly through a series of ever-larger rounds: a $62 million Series B in July 2017 led by Y Combinator's Continuity Fund (its first-ever investment in a company it hadn't previously accelerated), with Bill Gates's Cascade Investment, Mosaic Ventures, and Barry Diller also participating; a $185 million Series C in September 2018 led by CapitalG (Alphabet's growth equity arm) at a $1 billion valuation, making Convoy a 'unicorn' and adding CapitalG partner David Lawee to its board; and a $400 million Series D in November 2019 led by Generation Investment Management and T. Rowe Price at a $2.75 billion valuation, with participation from Baillie Gifford, Fidelity, Durable Capital Partners, CapitalG, and Lone Pine Capital. By late 2019 Convoy had grown to roughly 850 employees and was matching tens of thousands of loads per week across roughly 100 lanes, up from hundreds per week in 2016, and had landed marquee shipper customers such as Unilever. In April 2022, near the peak of the pandemic-era freight boom and startup financing environment, Convoy raised a $260 million round led by Baillie Gifford and Hercules Capital (plus a $150 million credit facility from JPMorgan), pushing its valuation to a peak of $3.8 billion and its headcount to roughly 1,500 employees.

The peak proved short-lived. Starting in mid-2022, the freight industry entered a severe, prolonged 'freight recession' as pandemic-era shipping demand normalized and spot rates collapsed, while simultaneously the Federal Reserve's aggressive interest-rate tightening sharply curtailed late-stage venture and growth capital for unprofitable companies. Convoy conducted multiple rounds of layoffs and office closures through 2022 and into 2023 (June 2022, October 2022, February 2023, and June 2023), and co-founder Grant Goodale stepped down as Chief Experience Officer in June 2023 after eight years with the company. By October 2023, after roughly four months of what CEO Dan Lewis described as exhausting 'all viable strategic options' — including seeking a sale to a strategic acquirer — Convoy could not find a buyer or raise a rescue round. On October 18-19, 2023, Convoy abruptly canceled all shipments, emptied its load board, and ceased brokerage operations entirely, laying off nearly all of its roughly 500 remaining employees without severance. In an internal memo, Lewis called it a 'perfect storm' in which 'market forces were too strong for us to withstand on our own,' citing the freight recession compounding with capital-market contraction that simultaneously crushed Convoy's own operations and the appetite/ability of potential strategic acquirers to buy it.

Business model

Digital freight brokerage / two-sided marketplace connecting shippers (companies needing to move freight) with independent truck carriers and drivers, using automated, ML-driven load matching (including 'automated reloads' to chain backhauls and reduce empty miles).

Brokerage spread/take-rate between what shippers paid and what carriers were paid per load, plus enterprise/managed transportation services for large shippers.