Convoy hires bank to advise on strategic interest

Convoy CEO Dan Lewis at FreightWaves' Future of Supply Chain event in Rogers, Arkansas, in May 2022. Photo: Jim Allen / FreightWaves.

Seattle-based digital freight brokerage Convoy has hired an investment bank to help it explore “strategic options that could include a sale of the company,” The Information has reported.

Sources told FreightWaves that bank is Goldman Sachs. 

The options on the table appear to be a merger or sale to a large strategic partner or a large capital investment from a financial sponsor.

Convoy was last valued at $3.8 billion in April 2022, when it raised $160 million in equity from Baillie Gifford and T. Rowe Price and $100 million in venture debt from Hercules Capital in a Series E package, and secured access to an additional $150 million line of credit from J.P. Morgan. That valuation is not expected to hold up in an acquisition this year.


At the time, the structure of the investment was widely perceived to be a prudent way to shore up Convoy’s balance sheet as the freight market turned south. Since then, the U.S. truckload market has seen a significant downturn in both volume and rate, while excess capacity persisted longer than expected.

That has put pressure on freight brokers, who typically sell their logistics services to shippers on a contract rate basis and buy trucking capacity on the spot market. Competition between freight brokers for the largest companies’ freight drove their contract or “sell” rates way down, compressing margins. Those market dynamics have been brutal for freight brokers’ income statements.

For instance in the second quarter of 2023, C.H. Robinson’s North American Surface Transportation division, the country’s largest truck broker, saw margins compress to 13% and adjusted gross profit per load get cut by 45% year over year. Meanwhile at Uber Freight, in the same quarter gross revenue fell by 30% year over year to $1.2 billion, leading the division to a $14 million loss in earnings before interest, taxes, depreciation and amortization.

Convoy felt the pressure, too, conducting at least four layoffs since early 2022. A large customer operations team at the Atlanta office was cut in February of this year. Convoy co-founder and one-time Chief Technology Officer Grant Goodale left the company in June, shortly before the company’s most recent layoff.


While the Series E financing got Convoy through the back half of the most volatile trucking cycle in recent history, now Chief Executive Officer Dan Lewis and his board are looking for the next step.

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