Surplus Capacity Undermines Freight Marketplaces
Convoy
This is the core weakness of asset light freight marketplaces, when the market loosens, the shipper no longer needs a new source of trucks, it just goes back to its routing guide. In 2021, tight capacity pushed big shippers onto marketplaces like Convoy because primary carriers were rejecting loads. As freight cooled in 2022 and 2023, incumbents accepted more freight at lower prices, which reduced the urgency to use a marketplace for overflow.
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For an enterprise shipper, the workflow is simple. First send the load to core contracted carriers. Only if those carriers say no does the freight spill into brokers or marketplaces. When surplus trucks come back, more loads stay with incumbents, and the marketplace loses the overflow that powered growth during the shortage.
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Trucking is also less self serve than software marketplaces. Loads need appointment changes, exception handling, detention disputes, and constant human coordination. That makes digital brokers easier to adopt in a crisis, but harder to keep as a default channel once legacy carriers have capacity and are willing to match price.
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The comedown was severe for Convoy. Revenue rose from about $500M in 2020 to $750M in 2021 and $1.0B in 2022, then fell to about $320M in 2023. Convoy shut down on October 19, 2023, and Flexport acquired its technology stack on November 1, 2023, rather than the operating business itself.
Going forward, the durable winners in freight tech are likely to be the ones that sit inside the shipper workflow even in soft markets, through transportation software, execution tools, or broader logistics services, not just overflow marketplace volume. The more a product helps manage every shipment, not only hard to cover shipments, the harder it is for customers to pull spend back to incumbents when capacity returns.