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Convoy, the company behind a digital freight network and marketplace connecting shippers to truck drivers, has raised $260 million in financing, representing a Series E round of $160 million and $100 million in risk debt.
Founded in Seattle in 2015, Convoy partners with companies such as Unilever, The Home Depot and LG Electronics to improve the efficiency of their freight operations, reduce costs and improve their carbon footprint.
The problem Convoy is trying to solve in the freight space is similar to what Uber is trying to solve in the urban transportation area — it’s ultimately all about matching supply and demand, using technology. In fact, Uber itself offers a similar service called Uber Freight, which reuses its technology infrastructure to support business logistics.
Convoy’s latest increase comes at a time when the US and the world at large are facing numerous supply chain bottlenecks, including a shortage of truck drivers. Convoy addresses this somewhat by optimizing and streamlining freight loads and ensuring that trucks don’t travel long distances with empty trailers.
“Moving freight via trucks is the foundation of our domestic supply chain — when supply chains are unreliable, companies spend more money and waste valuable time,” Convoy co-founder and CEO Dan Lewis told VentureBeat. “As an industry, we need to focus less on trailer or driver shortages and more on how we can do more with what we have. The real priority is to make skilled hauliers and drivers work efficiently, get paid quickly for the work they do and feel valued in their profession.”
Convoy Mobile App
Slow to adapt
As with other industries such as construction, the freight industry has historically been slow to embrace technology and not as quick to embrace digitalization as some industries have been — which is where Convoy and its ilk are competing.
In addition, Convoy’s mission may have been made a little easier in the past two years as companies across the spectrum have sought to counteract the effects of the global pandemic through digital transformation. bottom line. And automation plays a fundamental role here, with Convoy specifically relying on smart machine learning to match freight loads and trucks with virtually no human intervention.
“Historically, the freight industry has been underinvested in technology and as a result, management teams have struggled with more gunfights over the past two years,” explains Lewis. “Technology is the only way to achieve efficiency and to scale flexibly with demand. Machine learning and automation have revolutionized the elastic capacity of freight, allowing carriers to operate efficiently regardless of market conditions.”
Previously, Convoy had raised about $670 million in financing, including a $400 million tranche from two years ago, and with the cash injection slates, the company said it plans to invest heavily initially in strengthening its assets. team, including hiring engineers, data scientists, and logistics experts.
Bigger picture, we remain focused on our mission to ‘transport the world with endless capacity and zero waste,’ added Lewis. accelerate development of first-to-market products and technologies, expand our truck market and our offerings to carriers and shippers in the US”
Convoy’s Series E round was led by Baillie Gifford and T. Rowe Price, with the risk-debt element coming from Hercules Capital — and it said it had secured an additional $150 million line of credit from JP Morgan. The company is now valued at $3.8 billion, representing an increase of more than $1 billion from its 2019 Series D valuation.
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This post On-demand digital freight network Convoy raises $260 million
was original published at “https://venturebeat.com/2022/04/21/on-demand-digital-freight-network-convoy-raises-260m/”