Freight is an industry dominated by efficiency. Whether it’s getting cargo from point A to point B on the fastest route possible or finding the best truck for a shipment, the industry — valued at $800 billion — has greatly benefitted from software and tech innovations. Convoy, a Seattle-based freight company, has been trailblazing tech solutions for the industry since launching in 2015 and it recently raised new funding.
On Thursday, the company announced it secured two investments totaling $260 million in funding. The first investment was a $160 million Series E preferred equity round led by Baillie Gifford. The second investment was a $100 million venture-debt investment from Hercules Capital.
The investments bring Convoy’s valuation to $3.8 billion. The company said it will use these funds to develop more “efficiency-focused” technologies.
“Every day millions of truck drivers get in their cabs and do the work that keeps our economy moving while ensuring people get what they need,” Dan Lewis, co-founder and CEO of Convoy, said in a statement. “The pandemic highlighted how important trucking is and how volatile and inefficient this industry can be. We know that we can do better by using modern technology and algorithms to help orchestrate freight logistics, improve service, reduce waste and help drivers. That is Convoy’s mission.”
When working with clients that need a large volume of freight shipped, startups in the industry will typically get information from the client and schedule trucks to pick up and deliver the product. Convoy, on the other hand, has software that automatically matches a load with a truck. Its software also helps shippers manage shipments.
Convoy works with several small shipping companies and has a network of over 400,000 trucks ready to ship freight across the country. Its tech solutions for carriers include a platform that matches loads to drivers and their trucks. Carriers also get access to a platform that displays all the needed documentation for shipments and another that directly pays drivers for their work.
Not only has Convoy’s solution made the shipping process more efficient, but it also helped reduce environmental waste. By reducing empty miles, or miles in which a trucker drives with an empty load, Convoy says it has reduced CO2 emissions from 87 million metric tons per year to just 47 million metric tons.
Along with the funding news, Convoy announced that it secured a $150 million credit line from J.P. Morgan.
Convoy also recently appointed Sonia Jain as its new CFO. Jain joins Convoy after spending two years at Cars.com where she also served as CFO.
