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Trucking startup Convoy closes operations with no buyer

bloomberg.com

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Re: Trucking startup Convoy closes operations with no buyer

#21

Post by emgeee »

wooly_bully wrote: post #11

(Ex-)Convoy engineer here. No mystery as to why this happened, sudden tight market and low available capital demolished us. External reasons given in the article were the same we knew and couldn't do anything about considering that none of the M&A options materialized. Detailed the shutdown on a call at 8:30am Pacific this morning. CEO said there'll be no severance or healthcare. Lot of talented folks in Seattle and…

Dang, no severance or healthcare is really brutal and signals to me they probably should have called it earlier.

Re: Trucking startup Convoy closes operations with no buyer

#22

Post by ignite2 »

sputknick wrote: post #6

start-up idea if anyone is bored: disrupt car shipping. When I moved from Seattle to Raleigh shipping my car was BY FAR the biggest headache. It's a 20th century business where you have to call people, who will bid for you, and you have no idea if your bid is accepted. Agents will promise a low price to get your business, then tell you a week later that bid was too low, you need to double it. I eventually just gave u…

too small a market to be worth investing.

Re: Trucking startup Convoy closes operations with no buyer

#23

Post by fairity »

And so it begins. A large wave of unprofitable startups that raised in 2021/2022 are going to fail at becoming profitable and be forced into fire sales or bankruptcy over the next 12 months.

The capital constriction really started in Q3 2022. Here's a graph: https://techcrunch.com/wp-content/uploads/2023/03/Screenshot...

If I had to guess, bankruptcies like this peak sometime next year since many of these companies will find a way to last 24 months on their last fundraise.

Another recent example is Clutter, a moving company that raised $300m, who was forced into a fire sale for $30m.

Re: Trucking startup Convoy closes operations with no buyer

#24

Post by apercu »

infrawhispers wrote: post #4

From a friend: Everyone was laid off with no severance or benefits. The CEO put all the blame on a lender in order to explain why there were no severance packages. This sucks because they took it upon themselves to offer staff retention bonuses earlier this year to keep people around after the earlier layoff.

I'd be interested in whether the C-level got any severance or healthcare....

Re: Trucking startup Convoy closes operations with no buyer

#25

Post by bdcravens »

wooly_bully wrote: post #11

(Ex-)Convoy engineer here. No mystery as to why this happened, sudden tight market and low available capital demolished us. External reasons given in the article were the same we knew and couldn't do anything about considering that none of the M&A options materialized. Detailed the shutdown on a call at 8:30am Pacific this morning. CEO said there'll be no severance or healthcare. Lot of talented folks in Seattle and…

Absolutely terrible. Tiny companies NOT backed by some of the richest men in the world give more when they wind down.

Re: Trucking startup Convoy closes operations with no buyer

#26

Post by bydo »

sputknick wrote: post #6

start-up idea if anyone is bored: disrupt car shipping. When I moved from Seattle to Raleigh shipping my car was BY FAR the biggest headache. It's a 20th century business where you have to call people, who will bid for you, and you have no idea if your bid is accepted. Agents will promise a low price to get your business, then tell you a week later that bid was too low, you need to double it. I eventually just gave u…

I shipped a car across the country a decade ago, and I didn't go through any of this. I used a website, it gave me a price, I paid it, and a truck showed up.

Re: Trucking startup Convoy closes operations with no buyer

#27

Post by spieswl »

wooly_bully wrote: post #11

(Ex-)Convoy engineer here. No mystery as to why this happened, sudden tight market and low available capital demolished us. External reasons given in the article were the same we knew and couldn't do anything about considering that none of the M&A options materialized. Detailed the shutdown on a call at 8:30am Pacific this morning. CEO said there'll be no severance or healthcare. Lot of talented folks in Seattle and…

Good luck and my condolences

Re: Trucking startup Convoy closes operations with no buyer

#28

Post by nerdponx »

echelon wrote: post #15
renegade-otter wrote: post #12

"The appetite for venture funding of freight brokerages has been dead for over a year and is partially responsible for the reason Convoy has failed. VC investors have woken to the reality that freight brokerage is not venture-investible." So they WeWorked it. Instead of focusing on long-term growth strategy for a very good and sustainable business, the top management decided to get rich quickly, destroying the compan…

> Bed Bath & Beyond Is this why BBB failed? My perception is that the retailer was stuck in 2000. The stores always felt stuffy.

I used to really enjoy BB&B shopping. It was like Santa's Workshop of medium-quality products stacked floor to ceiling. And I liked their Wamsutta brand stuff years ago when the quality was still decent.

Re: Trucking startup Convoy closes operations with no buyer

#29

Post by tempsy »

fairity wrote: post #23

And so it begins. A large wave of unprofitable startups that raised in 2021/2022 are going to fail at becoming profitable and be forced into fire sales or bankruptcy over the next 12 months. The capital constriction really started in Q3 2022. Here's a graph: https://techcrunch.com/wp-content/uploads/2023/03/Screenshot... If I had to guess, bankruptcies like this peak sometime next year since many of these companies w…

Yes feels like we've seen surprisingly few shutdowns.

Re: Trucking startup Convoy closes operations with no buyer

#30

Post by dilyevsky »

jeffreyrogers wrote: post #18
renegade-otter wrote: post #12

"The appetite for venture funding of freight brokerages has been dead for over a year and is partially responsible for the reason Convoy has failed. VC investors have woken to the reality that freight brokerage is not venture-investible." So they WeWorked it. Instead of focusing on long-term growth strategy for a very good and sustainable business, the top management decided to get rich quickly, destroying the compan…

How would top management get rick quick with no exit? Equity presumably went to 0, so their compensation is the cash flow they got from their salary while Convoy was in business.

Not saying that’s what happened here but occasionally you can get money off the table by selling some of your equity during a funding round. Afaik that’s how Hopin and WeWork ceos got hundreds of millions despite their companies going to zero basically
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