
Revenue
$320.00M
2023
Valuation
$3.80B
2023
Growth Rate (y/y)
-57%
2023
Funding
$930.00M
2023
Revenue
Convoy's revenue peaked at $750M in 2021, growing 50% annually. However, the company experienced a significant decline, with revenue dropping to $320M in 2023. This represents a 57% decrease from its 2021 peak.
Despite previously projecting growth, Convoy struggled financially in 2023. The company's revenue collapse in the first nine months of the year fell far short of its 2022 performance. This financial downturn made it difficult for Convoy to secure additional funding or find a buyer.
After unsuccessful attempts to raise money or sell the company over a four-month period, Convoy ultimately ran out of funds and shut down operations in 2023. Prior to its closure, Convoy operated a network of 400,000 trucks and counted major enterprises such as Home Depot, Procter & Gamble, Unilever, and Anheuser-Busch among its customers.
Convoy's business model was based on creating a price arbitrage between shippers and carriers, keeping the difference as revenue. The company had previously reported profitability on a per-transaction basis.
Valuation
Convoy reached a peak valuation of $3.8 billion during a funding round led by T. Rowe Price and Baillie Gifford, before ceasing operations in 2023. The digital freight network raised over $1 billion in total funding throughout its lifetime. Notable investors included prominent tech figures Jeff Bezos and Bill Gates, along with institutional investors like CapitalG (Alphabet's venture arm) and Generation Investment Management (Al Gore's investment firm). The company attracted significant capital from both strategic and institutional investors before its closure in late 2023.
Business Model

The US trucking market is worth $800B with 100k+ shippers and 1M carriers, of which 95% have less than 10 trucks. This makes it difficult for shippers to find carriers directly, and they rely on 17,000+ brokers to match loads with carriers who charge 15% to 20% per transaction.
The matchmaking is manual and effort-intensive, with an army of reps at these brokers calling/emailing carriers for each new load, spending up to 4 hours on every transaction. Furthermore, brokers are incentivized to maximize their margins rather than make efficient routes, resulting in 35% of miles driven back by trucks without freight, with a loss of $10B annually.
Convoy’s core thesis is to replace this inefficient manual matchmaking with algorithmic matchmaking. Once shippers list their freight on Convoy, its pricing algorithm shows them a price estimate for the freight and then runs an auction on the carrier side, composed mainly of the long-tail, for them to accept the freight at a lower price, with Convoy keeping the spread on the transaction as its revenue. Convoy mentions that 100% of matching in its top markets is automated, with a matching time of a few minutes.
By replacing reps with algorithms, Convoy operates at lower costs allowing it to take a lower take rate than traditional brokers, leverage this low fee to attract shippers, and use the increased load volume to sign up more carriers, creating a flywheel effect. We expect Convoy to operate at a gross margin of less than 10%, like Transfix (gross margin: 6.4%) and Uber Freight (operating margin: 0.1%), as the bulk of its revenue comes from enterprise shippers who offer take rates of less than 5%.