Once of the region's highest-valued private tech companies is shutting down.
On Thursday, Convoy CEO Dan Lewis sent a memo to employees saying the Seattle-based freight network startup is closing down its core business, and Thursday would be most employees' last day at the company. The announcement comes after reports surfaced Wednesday that Convoy had paused shipments on its platform.
"We are in the middle of a massive freight recession and a contraction in the capital markets," Lewis wrote in the memo. "This combination ultimately crushed our progress at the same time that it was crushing our logical strategic acquirer — it was the perfect storm."
Lewis added that some employees would stay on to help with "this windup transition and potential future strategic options." He said the company spent over four months exploring its options, but nothing materialized, and the market conditions made further funding or an acquisition challenging. Lewis didn't specify next moves for what remains of the company, saying only that Convoy is "evaluating strategic options for what might come next."
After news about Convoy broke Wednesday, a spokesperson told the Business Journal the company was "preparing our business for a transition."
Convoy hit a valuation of $3.8 billion in April 2022, when the company raised $260 million between equity funding and venture debt. The company also secured a $150 million line of credit from J.P. Morgan at the time. Since June of last year, however, Convoy has gone through four rounds of layoffs and closed its Atlanta office as the freight market struggled.
Convoy was founded in 2015. Its business involved connecting shippers to trucking companies, or carriers, to reduce the number of empty miles truck drivers spend on the road. Trucking companies, meanwhile, could find and bid on loads through Convoy's app. Convoy has counted as clients companies like Unilever, The Home Depot and Anheuser-Busch.
Microsoft co-founder Bill Gates, Amazon founder Jeff Bezos, Salesforce CEO Marc Benioff, Uber CEO Dara Khosrowshahi and former Starbucks President Howard Behar were all early backers of Convoy.
At the time of the fundraise in April 2022, Chief Growth Officer Ryan Gavin said Convoy had roughly 1,300 employees, including more than 800 in Washington. Convoy has less than 790 employees listed on LinkedIn now.
Convoy co-founder Grant Goodale stepped down from his role as chief experience officer in June, but stayed on as an adviser and remained on the board. He confirmed the move to the Business Journal just days before Convoy's most recent round of layoffs, which affected only the company's customer experience operations team. Convoy had more than 840 employees listed on LinkedIn at the time of the June layoffs.
"We moved all business levers possible. But we were running up the down escalator ... and it kept speeding up," Lewis wrote in the Thursday memo. "Over the past few months I experienced some of the highest highs and lowest lows in business, but throughout it I remained motivated because of the incredible people at Convoy who gave me inspiration every day. You guys rock."
