Trucking startup Convoy closes operations with no buyer • Hacker News Board

Re: Trucking startup Convoy closes operations with no buyer

#201

Post by Fordec » Thu, Oct 19, 2023, 8:20 PM UTC

asdff wrote: post #181

Fordec wrote: post #167

Earlier quoted context omitted.

This is why dissolution isn't some whopsey-doodle word. When there's nothing left, there's nothing left. If that is a risk, including in that is your private healthcare provision, leave this stuff up to the 20 year olds that don't have the health concerns. Coddled might be too diminutive of a phrase, but if it's a risk you can't live with by your life expectations, don't get involved. Pick another job on the market.…

The whole issue with this premise is that someone has to bear the risk. There are no 20 year olds who know with certainty that they don't or will not soon have health concerns that require insurance. Anyone could be get hit with a car walking across the street or get a photon to break some DNA in their skin and cause a melanoma. 20 year olds are not invincible or always in perfect working order.

And yet, statistically, the vast majority will be healthy. And the ones with chronic issues should know where they need to be on how to manage it. It's down to you if how you want to live your life. Plenty of tech companies that aren't startups. Plenty of countries that pay less and have higher taxes that have the safety net. Pick your lifestyle and live with your decision. I did, took the risks, it didn't pay off, but I would do it again.

Re: Trucking startup Convoy closes operations with no buyer

#202

Post by tmshu1 » Thu, Oct 19, 2023, 8:21 PM UTC

gcampos wrote: post #80

To think that 1 year ago they were aggressively spamming me for an engineering position there. How you go from "hyper growth mode" (according to the recruiter email) to closed operations within 13 months?

“Hyper growth mode” = hiring as fast as possible. Startups gotta borrow and spend their way to success, and fast, ya know. Can’t keep the VC’s waiting on their returns.

Re: Trucking startup Convoy closes operations with no buyer

#203

Post by asdff » Thu, Oct 19, 2023, 8:22 PM UTC

paxys wrote: post #17

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…

Businesses like these are hard to "disrupt" because despite all the fancy websites and apps, pricing algorithms, scheduling, reminders, live video feeds and whatever else you can build, underneath it all the success or failure still depends on some guy showing up at your house, picking up your car and trucking it across the country. Unless you can automate that part nothing will fundamentally change.

I think the expectation is even worse for the car case than anything since so few people bother shipping cars to begin with. But just looking at moving and shipping, even then no one has really beaten the model that Uhaul has created. Have the 7/11 or big box hardware store parking lot and clerk be your brick and mortar and labor force. Have a very basic website match you to pickup and dropoff locations. Buy a bunch of cheap aluminum trailers that won't rust out on you. They will even sell you overpriced cardboard boxes they probably get a ridiculous markup on. I don't think you can lighten this sort of business much more than that, and yet the profit margins still aren't as high as you'd expect from such a skeleton crew of a business. 16% last earnings.

Re: Trucking startup Convoy closes operations with no buyer

#204

Post by JumpCrisscross » Thu, Oct 19, 2023, 8:23 PM UTC

dboreham wrote: post #192

benced wrote: post #72

Earlier quoted context omitted.

Ex-Convoy employee here: if a company is shutting down, it obviously can't provide severance. It's not a matter of class or not.

> if a company is shutting down, it obviously can't provide severance Not really true. The company is owned by its shareholders, and they may choose to use funds belonging to the company (after paying outstanding obligations) to pay severance, or they may divide the funds among themselves. If there are no funds, they can choose to invest more to pay severance. Obviously they're unlikely to want to do that, but it's n…

> they may choose to use funds belonging to the company (after paying outstanding obligations) to pay severance

If they can do this, they can pay salaries another month. Making a go/no go call at the edge is difficult. It sounds like Convoy thought it was getting a loan that didn’t come through.

Put another way: if the CEO shut down the company while loan negotiations were in place, it would have zeroed out the common stock while giving preferred investors a pay-out (in addition to everyone some severance).

Re: Trucking startup Convoy closes operations with no buyer

#205

Post by the_optimist » Thu, Oct 19, 2023, 8:23 PM UTC

fourseventy wrote: post #45

faefox wrote: post #40

Earlier quoted context omitted.

"As I just shared on our call, I think the world of you." Just not enough to offer any severance or healthcare. #TruckYeah!

The company is shutting down because they ran out of money... where do you think this magical severance pay is going to come from?

Perhaps conscript some doctors and pharmaceutical manufacturers under penalty of fine or imprisonment. Don’t let them go until they provide the health care we each and all deserve.

Re: Trucking startup Convoy closes operations with no buyer

#206

Post by neaden » Thu, Oct 19, 2023, 8:23 PM UTC

laserlight wrote: post #178

WisNorCan wrote: post #121

Earlier quoted context omitted.

It is interesting to see that employees of Convoy aren't saying bad things about the CEO. But people on the outside who don't know the CEO are saying bad things. Usually it is the reverse.

Stockholm syndrome is a thing: https://en.wikipedia.org/wiki/Stockholm_syndrome

To be clear, it actually isn't a recognized psychological phenomenon as you can see at your own link. It was invented by a police psychiatrist who did a bad job being a hostage negotiator and came up with it to explain why the hostages were mad at him.

Re: Trucking startup Convoy closes operations with no buyer

#207

Post by adam_arthur » Thu, Oct 19, 2023, 8:24 PM UTC

ska wrote: post #175

adam_arthur wrote: post #160

Earlier quoted context omitted.

While true, most of these startups that have already found product/market fit and go bust are operating off of unrealistically rosy projections. Did this company need to burn their entire round in a single year? Probably not. Could they have established themselves with lower operating expenses and still grown over time? Probably.

For the sake of argument, assume your contentions are true. Now how do you draw a line from that to the probability that the technical team that has been let go is not high quality?

I wasn't speaking to that point... excessive operating expenses are clearly a management failure. I was contending that this shutdown is not likely simply "through no fault of their own"

People who can't asses fair value of a business from a discounted cashflow perspective shouldn't be running a company. It's usually financially ignorant people like this that lead the business down a dark path. The prior round valuation, and thus the implicitly underwritten future expectations of growth, is evidence enough that something along these lines happened here.

Re: Trucking startup Convoy closes operations with no buyer

#208

Post by jonkho » Thu, Oct 19, 2023, 8:24 PM UTC

v1l wrote: post #171

bart_spoon wrote: post #86

Earlier quoted context omitted.

If things are dire enough to close up shop now, they probably were dire enough to close up shop 2 months ago, and you can use the cash to give your employees some runway for finding new employment.

Entitlement is more prevalent than we think.

Yep people talk like they are owed something. They are not. Outstanding obligations are met with each paycheck.

Re: Trucking startup Convoy closes operations with no buyer

#209

Post by arrosenberg » Thu, Oct 19, 2023, 8:25 PM UTC

avalys wrote: post #169

bart_spoon wrote: post #127

Earlier quoted context omitted.

Of course they will. What is the magic that separates success from failure that apparently only magically appears within the last 4 weeks with operating capital in the bank? Move your time tables up by 4-8 weeks, including funding raises and closing operations, and none of this is an issue.

If you can still operate the business for another 8 weeks, there's a chance that things will still work out, and it's pretty pessimistic to preemptively shut it down because you assume you're going to fail. Pessimists don't generally find themselves in the role of founder/CEO of a startup in the first place.

Actually good founders and CEOs do tend to be realists. They know when to hold and when to fold, and they place a high value the well being of the people especially when things go poorly.

Manic founders who insist that a rescue will come right up until the last second often leave people feeling burned and don't get as many second chances when things don't go well.

Re: Trucking startup Convoy closes operations with no buyer

#210

Post by conjecTech » Thu, Oct 19, 2023, 8:25 PM UTC

busterarm wrote: post #137

vogt wrote: post #55

Earlier quoted context omitted.

>CEO said there'll be no severance or healthcare. Classy. Learning a lot about how certain people treat their employees during these last couple of admittedly insane years. Good for future reference, I guess - though not much solace now. I feel for the employees. Edit: Wow, more responses than I thought! I admit that the tone of my comment was too reactionary, but my opinion stands. I won't modify the original commen…

Startups are not established businesses. They are inherently risky ventures. If you want to be coddled and showered with benefits, go join a Fortune 500. Startups are not for you.

This is the worst take I have ever seen. This company just raised $250 million. That is more money than 99% of companies will ever have in the bank. Being a "startup" does not given you license to wantonly play with your employees' lives and wellbeing. As the quote from Dalton above shows, there are norms around these things which companies 1/100 this size regularly abide by.

This is not normal behavior for any company, and you should run away from anyone trying to convince you otherwise. The people responsible should be treated like pariahs.