What the heck happened at Convoy?
GeekWire
GeekWire
4.4 • 116 Ratings
🗓️ 21 October 2023
⏱️ 23 minutes
🧾️ Download transcript
Summary
This week on the GeekWire Podcast, we examine the market forces, debt, and other dynamics that put the digital freight marketplace Convoy out of business, bringing one of the Seattle region's top startups to the end of the road.
Related coverage:
- ‘The markets crushed us’: In tearful farewell to employees, Convoy execs reflect on shutdown
- Convoy collapse: Read CEO’s memo detailing sudden shutdown of Seattle trucking startup
Convoy raised $260 million just 18 months ago, at a valuation of $3.8 billion. Its investor list was a who's who of tech moguls and celebrities, including Bill Gates, Jeff Bezos, Marc Benioff, and even Bono and The Edge of U2 fame.
GeekWire co-founder John Cook, who has covered startups and venture capital since before the dot-com bust, compares Convoy's implosion to past flameouts of high-profile startups, and explains the long-term trends in investing that served as the backdrop for Convoy's demise. After a long stretch of free-flowing capital at astronomical valuations, fundamental business realities are catching up to some heavily funded startups.
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Transcript
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| 0:00.0 | I think it's a lesson in just raising money and we got to remember these are all high risk |
| 0:06.0 | Endeavors we've been in a period of up until the last 12-18 months where it's been just for the decade prior it was just free money and people |
| 0:15.8 | were just raising money at astronomical valuations that didn't make much sense for |
| 0:20.5 | business models that didn't have a lot of revenue coming through them. |
| 0:24.0 | Things are just catching up to a more realistic way of running businesses now. Hi and welcome to GeekWire. I'm GeekWire co-founder Todd Bishop and I'm |
| 0:37.5 | GeekWire co-founder John Cook. We are coming to you from Seattle where we get to |
| 0:40.8 | report each day on what's happening around us in business, technology, and innovation. |
| 0:45.0 | What happens here matters everywhere and every week on this show we talk about some of the most interesting stories in the news. |
| 0:51.0 | Coming up, we've got what I think must be one of the biggest Seattle |
| 0:54.7 | startup implosions ever. Is that the right way to describe what happened to |
| 0:59.0 | convoy this week? I think so. I think I was going back into my own archive pulling up some companies that I had written about in the early 2000s that imploded and it wasn't quite as bad as this. |
| 1:11.8 | What was that like Terra Beam? What was that like, Terra Beam? |
| 1:13.2 | There was a company called Terra Beam |
| 1:14.5 | that had raised several hundred million dollars, |
| 1:17.7 | but they eventually sold. |
| 1:20.3 | But let's come back to that. |
| 1:21.6 | Yeah, okay, so coming up up we'll dive into what happened with convoy |
| 1:25.9 | That'll be in our second segment this week, but first let's talk a little bit about the GeekWire summit John we had nearly six hundred. |
| 1:33.0 | Great day. |
| 1:34.1 | It was really fun. |
| 1:35.4 | We had nearly 600 of you out at the SIF Cinema, the former Cinerama movie theater, |
| 1:40.9 | in Seattle, for a half-day conference followed by a film screening in the evening of arrival, |
... |
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