Convoy claims that it has over 400,000 truckers who use its smartphone app.
Convoy, a digital platform that makes trucking easier, announced it had raised $260 million more to expand its service. This is because of rising fuel prices and inflation, which pushes shippers and freight brokers toward finding more efficient ways to move goods.
According to the Seattle-based company, $160 million was raised in a round by Baillie and T. Rowe Price. Hercules Capital invested $100 million in venture debt investment. Convoy also secured a $150 million line credit from J.P. Morgan. It has raised $925m to date and is now valued at $3.8 billion.
Mark Okerstrom (Convoy’s president, COO) tells Forbes that the new money will “allow us just to continue funding the building out the technology platform, the launching of new products.” This includes recent offerings like “Convoy For Brokers,” which allows brokers to access our capacity platform and 400,000 trucks.
Convoy and rival services like Uber Freight focus on modernizing U.S. freight-booking systems that were traditionally low tech and not always able to deploy trucks most efficiently. Inflation and the complications caused by the Covid-19 pandemic have led to digital services like Convoy becoming more critical to lowering costs in the U.S. trucking sector, which is estimated to generate $800 billion annually.
Convoy’s mobile app lets truckers and shippers coordinate loads.
“The pandemic showed how important trucking was and how volatile this industry can become,” Dan Lewis, co-founder, and CEO said. We know we can do better using modern technology and algorithms to improve freight logistics, reduce waste and help drivers.
Convoy’s platform is accessible through a smartphone app and uses machine learning to match loads with carriers. This prevents trucks from “empty miles” without any loads. It currently has over 400,000 trucks on its network.
Okerstrom stated that revenue for the seven-year-old, closely held company is increasing by approximately 50% each year and should reach $1 billion in 2012.
Although the company has not announced its plans to go public, he stated that the new funding “puts us on an excellent footing.”