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

Re: Trucking startup Convoy closes operations with no buyer

#471

Post by datadrivenangel » Fri, Oct 20, 2023, 2:27 AM UTC

clutchdude wrote: post #370

mrcwinn wrote: post #305

Earlier quoted context omitted.

>choose to invest more to pay severance Deploying capital into something that literally has no return just doesn't make sense. You're also ignoring the reality that most capital comes in at the start. It doesn't come in at the end. That's an irrational investment. Would you buy a house that's burning down in the interest of the current homeowners? Could a company receive funds at the end? Legally, sure, maybe (maybe…

> That's a very ineffective use of capital and those types of decisions are worse in the end for the economy Disagree - it frees those employees to begin working for more productive companies sooner rather than drag them through "you are fired with no provisions for healthcare. Good luck and don't get sick during the donut period. " - yes, it's an special qualifying trigger for the exchanges but you are asking someon…

Disagree to disagree - employees are free to begin working for more productive companies when they're fired with no provisions for healthcare.

In spirit though, I agree. Social healthcare not tied to employer would allow for more labor mobility. These transitions should not abrupt or catastrophic ideally.

Re: Trucking startup Convoy closes operations with no buyer

#472

Post by nl » Fri, Oct 20, 2023, 2:34 AM UTC

slt2021 wrote: post #458

sangnoir wrote: post #384

Earlier quoted context omitted.

Here's a point by point rebuttal: 1. Hollywood unions disprove this 2. Hollywood unions (SAG, DGA) disprove this 3. Unions don't mean you can no longer negotiate. DiCaprio still does 4. One upside: Unions represent members who are no longer able to work 5. Hollywood unions have some pretty specialized folk and it works well for them As an individual - you only bargaining chip is your ability to do work. If you lose c…

You skipped the downsides of hollywood unionization: Cost of hiring increases and there are fewer gigs around. Unionisation adds nontrivial transaction costs, so there will be fewer opportunities for new entrants, and fierce competition among existing workers for shrinking number of gigs. For example look at how women actors get their cast roles with harvey weinstein studio - did union protect them from sexual predat…

> Hollywood is not growing at all

Well this certainly isn't true. Hollywood has grown hugely over the last 20 years (with a massive crash during COVID):

https://www.statista.com/statistics/271856/global-box-office...

It looks like it is on track to recover completely this year:

https://www.boxofficemojo.com/year/

Re: Trucking startup Convoy closes operations with no buyer

#473

Post by vidarh » Fri, Oct 20, 2023, 2:36 AM UTC

sangnoir wrote: post #226

JumpCrisscross wrote: post #204

Earlier quoted context omitted.

> 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 commo…

> If they can do this, they can pay salaries another month If leadership decides to use the remaining funds on salaries rather than severance - then they should be judged on that! What good is buying one extra month for a doomed company? That month is more valuable to individual employees who can use it to look for new jobs

The problem is you don't always know it's doomed. A company I co-founded got to within 5 days of insolvency before we secured the next $5m round. The company never got a big exit, but it did sell a few years later, and the product still exists 22 years after.

I think the big question is how well communicated the risks are. In our case I believe everyone knew, and there'd have been no hard feelings if people had chosen to look for new jobs once funds got tight.

Re: Trucking startup Convoy closes operations with no buyer

#474

Post by quickthrower2 » Fri, Oct 20, 2023, 2:42 AM UTC

pc86 wrote: post #344

quickthrower2 wrote: post #299

Earlier quoted context omitted.

In the limit this means go insolvent/bankrupt and not pay out to creditors such as lease, caterers, cloud services. Finish with unpaid taxes and wages.

I'd always rather see employees get payouts on shutdown compared to companies, especially things like billion/trillion-dollar cloud companies and commercial real estate. That being said if you're burning $30M+ every month in the current financial market I really hope you cancelled all your catering contracts a long time ago.

Depends: food can dupe people into working extra hours for free. They think they are having a lunch break as they talk shop while chewing on their ciabatta.

Re: Trucking startup Convoy closes operations with no buyer

#475

Post by vidarh » Fri, Oct 20, 2023, 2:42 AM UTC

cma wrote: post #359

ditonal wrote: post #328

Earlier quoted context omitted.

So tired of companies that raise hundreds of millions from some of the wealthiest and most powerful people in the world trying to pull the “we’re a startup” card. You’re not two dudes eating ramen in a garage and you don’t get to use that image to excuse your shitty behavior. Also tired of the “other people in poverty are exploited even worse! You asking for basic labor protections shows your lack of empathy for them…

> Imagine if all the SWEs at all these VCs backed companies went on strike unless the laid off Convoy employees got six months of healthcare (it would have been in the initial employment contract). Congress made secondary strikes illegal a long time ago. Maybe it would still be OK since that wouldn't technically be cross-industry; I'm not sure.

There was a time when US unions striked despite being met by a risk of people getting outright murdered. Without hyperbole, the 8 hour working day was won with blood. The question needs to be whether you think a strike is right and morally justified, and worth the potential consequences, not whether it is legal.

Re: Trucking startup Convoy closes operations with no buyer

#476

Post by jrockway » Fri, Oct 20, 2023, 2:57 AM UTC

vogt wrote: post #55

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…

>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…

Severance is basically marketing for future hires. You hope, as a company, you will be around in a few years and will be hiring again. If all the employees laid off during tough times get severance, then the company can say "even if we hit tough times, we have a track record of doing the right thing", which is attractive to future employees they are attempting to attract. Since the company is dead, their reputation doesn't matter.

Re: Trucking startup Convoy closes operations with no buyer

#477

Post by slt2021 » Fri, Oct 20, 2023, 3:04 AM UTC

nl wrote: post #472

slt2021 wrote: post #458

Earlier quoted context omitted.

You skipped the downsides of hollywood unionization: Cost of hiring increases and there are fewer gigs around. Unionisation adds nontrivial transaction costs, so there will be fewer opportunities for new entrants, and fierce competition among existing workers for shrinking number of gigs. For example look at how women actors get their cast roles with harvey weinstein studio - did union protect them from sexual predat…

> Hollywood is not growing at all Well this certainly isn't true. Hollywood has grown hugely over the last 20 years (with a massive crash during COVID): https://www.statista.com/statistics/271856/global-box-office... It looks like it is on track to recover completely this year: https://www.boxofficemojo.com/year/

you are looking at the wrong stuff, box office revenues go to Motion Picture companies and Hollywood fat cats like harvey weinstein.

just look at labor data: it is not pretty. $28/hr mean pay in Hollywood! Much less in other areas.

There is a reason why successful actors prefer to become producers/directors: because it pays better to be your own boss, rather than be at a mercy of union. and you don't have to engage in high end prostituion and literally sell your ass to people like Weinstein and Epstein, just to get a role at a high profile movie.

https://www.bls.gov/oes/current/oes272011.htm

Re: Trucking startup Convoy closes operations with no buyer

#478

Post by Retric » Fri, Oct 20, 2023, 3:04 AM UTC

paulddraper wrote: post #428

batmansmk wrote: post #425

Earlier quoted context omitted.

All official information mentions “shutting doors” and “winding down” and not necessarily a bankruptcy. For instance, in the same space, Shone just returned part of the equity to the investors, paid comp to the execs for a full year, and us, employees, got jackshit.

> paid comp to the execs for a full year IDK if Shone did things the most intelligent way, but the general story is not uncommon. Shareholders/creditors have a mess if the CEO and CFO walk out the door for their new job; it is financially beneficial for them to liquidate assets and shut the door. Shareholders/creditors don't have a mess when the engineer and a product manager walk out the door to their new job. That'…

This stuff doesn’t require the CEO or CFO either. Receivership doesn’t even require the active participation of the board, so yes there’s some benefit of keeping existing executives around but that’s often offset by the costs of doing so.

Re: Trucking startup Convoy closes operations with no buyer

#479

Post by rdl » Fri, Oct 20, 2023, 3:05 AM UTC

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…

Is there a website/etc for employee hiring?

Re: Trucking startup Convoy closes operations with no buyer

#480

Post by rdl » Fri, Oct 20, 2023, 3:12 AM UTC

vidarh wrote: post #473

sangnoir wrote: post #226

Earlier quoted context omitted.

> If they can do this, they can pay salaries another month If leadership decides to use the remaining funds on salaries rather than severance - then they should be judged on that! What good is buying one extra month for a doomed company? That month is more valuable to individual employees who can use it to look for new jobs

The problem is you don't always know it's doomed. A company I co-founded got to within 5 days of insolvency before we secured the next $5m round. The company never got a big exit, but it did sell a few years later, and the product still exists 22 years after. I think the big question is how well communicated the risks are. In our case I believe everyone knew, and there'd have been no hard feelings if people had chose…

FedEx famously got to within days of running out of money early on, and there is a story Fred Smith made payroll by taking the remaining cash to Las Vegas and gambling.