Scoop: Big layoffs coming at Convoy, a logistics startup backed by Bezos and Gates
Convoy, a Seattle-based logistics startup, is winding down its core trucking marketplace and will announce large layoffs on Thursday, Axios has learned from sources familiar with the situation.
Why it matters: The trucking marketplace gained a lot of buzz a few years ago, raising over $670 million from top investors like Jeff Bezos, Bill Gates, Capital G, Greylock, Y Combinator, and Fidelity.
Driving the news: After running an unsuccessful process with Goldman Sachs to find an acquirer or raise new funds, Convoy has halted all shipments on its marketplace, as news outlets reported earlier on Wednesday.
- The company hopes it can sell its brokerage business unit in the coming weeks, one source adds.
- Filing for bankruptcy isn't imminent, but possible in the future if Convoy doesn't find an acquirer.
- The layoffs are expected to impact a majority of Convoy's remaining 500 workers. At its peak, the company had around three times as many.
Between the lines: The shipping and logistics markets have turned south since the pandemic era's boomtimes.
- Fellow logistics darling Flexport recently fired its CEO, which it had hired from Amazon in a splashy move, and did layoffs earlier this week.
- Convoy also has been hampered by a tighter venture capital market. Its last equity infusion, a $160 million Series E round, was closed in September of 2021. It then raised $100 million of venture debt in March 2022.
What they're saying: "Today, we are taking several necessary steps to prepare Convoy's business for a transition that we will have more details on in the next 48 hours," a Convoy spokesperson told Axios in a statement.