Seattle-based trucking marketplace company Convoy has paused shipments, leaving the future status of the company unclear.
Reports emerged Wednesday that the company canceled loads from its marketplace. Employees were reportedly surprised by the news, and not given more information about what’s to come for the 8-year-old startup.
FreightWaves CEO Craig Fuller said Convoy “appears to be winding down operations.” Other freight carrier representatives posted about the news, aiming to attract new customers.
We’ve reached out to CEO Dan Lewis and a company spokesperson. We’ll update the story when we hear back. Update: The company says it is preparing for a transition and will share details later this week.
Convoy is one of Seattle’s most well-funded privately-held startups. The company was valued at $3.8 billion last year after raising $260 million.
Logistics startups have been hit hard by the freight market slowdown. Convoy has had multiple rounds of layoffs over the past year. It reportedly hired an investment bank this year and was weighing different options including a potential sale of the company, according to a report in August by The Information.
In an interview with GeekWire in June, Lewis said the trucking market was in a recession, citing an increase in the number of truck drivers that weakened demand.
Freight analysts speculate that mid-size freight brokers are in trouble due to market dynamics and financial struggles.
The $800 billion U.S. trucking industry is massive, but Convoy faces stiff competition from the likes of Uber Freight and Transfix, as well as traditional companies such as C.H. Robinson. Some of those firms — as well as Amazon and Walmart — have been rumored as potential Convoy acquirers.
The Wall Street Journal later reported Wednesday that Convoy was seeking a potential sale of its technology.
Convoy most recently laid off staff in June. The company previously made layoffs in February and closed its Atlanta office, which opened in 2019. Last year, the company conducted layoffs in October and June.
The company has more than 700 employees, according to LinkedIn. The Wall Street Journal reported that headcount was down to around 500 people, from a peak of 1,500. Bloomberg reported that Convoy was preparing to cut more staff this week to help prepare for a sale.
Founded in 2015 by former Amazonians and backed by the likes of Bill Gates and Jeff Bezos, Convoy aims to increase earnings for truck drivers while reducing cost for shippers by removing inefficiencies in the supply chain. Truck drivers download Convoy’s free app to find work without going through brokers who typically use emails and phone calls.
The company is ranked No. 3 on the GeekWire 200, our list of the top startups in the Pacific Northwest. Alumni from Convoy have gone on to launch multiple startups in the Seattle region.
Convoy’s other investors include Expedia Chairman Barry Diller; Salesforce CEO Marc Benioff; Code.org founders Hadi and Ali Partovi; former Starbucks president Howard Behar; U2’s Bono and The Edge; among others.
Co-founder Grant Goodale announced in June that he would step down from his position as chief experience officer and transition to an advisory role.
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