Since its launch, Convoy has been innovating with technological solutions aimed at reinventing the way freight moves across the country. To help fulfill that mission, the company is now expanding beyond its Seattle, WA, roots to a second office located in Atlanta.
The company, which made the announcement this morning, said that demand for its services has grown dramatically, particularly along the East Coast, making an Atlanta office ideal to help assist those customers.
Atlanta is a global hub for the world’s supply chain, with companies such as UPS (NYSE: UPS), Delta (NYSE: DAL), and Home Depot (NYSE: HD) calling the area home. An office in Atlanta will also help recruit and keep employees for the company, offering more flexible work opportunities.
The city of Atlanta is located in Freight Alley, a five-state region with approximately the same population as Canada that sports the highest concentration of people connected to the transportation and logistics industry in North America. 41% of the jobs connected to the region are in “logistics dependant industries.” According to our SONAR market-share data, Atlanta has the highest market-share of truckloads in the U.S., representing 4.5% of all truckload movements.
This past weekend, FreightWaves reported that Norfolk Southern is also likely to relocate it’s headquarters to Atlanta.
Convoy’s Atlanta office will include operations, support and account management teams focused on both existing customers and building new relationships with potential customers.
CEO Dan Lewis tells FreightWaves that Atlanta made sense as the company looked to expand its presence.
“It has a great population of potential employees for Convoy,” he says, adding that “the talent pool is really, really strong.”
Lewis notes that the Atlanta market is home to several Convoy customers and having a physical presence on the East Coast made sense as the company continues to grow. “Our fastest growing areas for us over the last year or so have been the Central/Eastern regions,” he says.
The office, chosen after the company reviewed 20 eastern cities, is expected to open “at the beginning of next year,” will employ several hundred people as staffing is ramped up over the next few years. Some personnel from Seattle will be relocating to Atlanta. Lewis says that is in part to help hire and train employees for the office, but also to ensure the Convoy work culture carries through to the new location.
The move is not surprising, considering the cost of running a truck brokerage operation out of Seattle, where wages, operation costs, and limited talent-pool create more challenges in scale. Another Seattle-based tech company has built out a signficant trucking brokerage operation in Atlanta: Amazon.
Lewis says the decision to expand is tied to timing and the fact that Convoy is mature enough as a company to do so.
“We’ve figured out who we are and what we stand for,” he notes. “So, now we are comfortable [growing].”
The growth has been seen in its expanding customer base as well as solutions that have garnered it praise in the industry. Convoy’s success in the West has helped it reaffirm its brand and in part, power its move East.
“It’s been very different for us expanding in the last year than it was in the first year,” Lewis says. “People recognize the name Convoy now” and that helps open more doors. The CEO adds that when people hear Convoy, there is an association with quality and a high bar for trust that stands out.
In August 2017, Convoy secured $62 million in a Series B fundraising round and backed that up with $185 million Series C round in September of this year.
Earlier this year, Convoy unveiled a power-only program and automatic detention pay. The power-only program creates a pool of drop-and-hook freight available to owner-operators. The concept behind the program is allow shippers to tap into the 90% of carriers that run smaller operations and do not have excess trailers that can be dropped at a location for loading at a shipper’s convenience. Convoy’s program provides this drop-and-hook capability to owner-operators for the first time.
In March, Convoy rolled out automatic detention pay for drivers of its 100,000-plus registered trucks. Any driver waiting at a dock more than 2 hours will automatically receive $40 per hour until the driver leaves the facility – either loaded or unloaded. The company is using GPS and geofencing to verify the truck’s detention.
Convoy research has found that carriers spend more than 4 billion hours waiting at facilities each year and more than 1 in 8 shipments incurs detention costing shippers nearly $8 billion per year in detention fees. Convoy’s data goes a step further, suggesting that facilities with a 6 hour wait time will pay 30% more to book a truck than a facility with a 2 hour wait time.
The company also introduced “suggested reloads” in March to help drivers find backhaul loads quicker. In August, Convoy launched “Dynamic Backup,” a shipper tool that inputs real-time and guaranteed market rate information into the routing guide, giving shippers more visibility into rates.