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"The appetite for venture funding of freight brokerages has been dead for over a year and is partially responsible for the reason Convoy has failed. VC investor

"The appetite for venture funding of freight brokerages has been dead for over a year and is partially responsible for the reason Convoy has failed. VC investors have woken to the reality that freight brokerage is not venture-investible." So they WeWorked it. Instead of focusing on long-term growth strategy for a very good and sustainable business, the top management decided to get rich quickly, destroying the company. But I am sure they did get rich quickly. Also see: Bed Bath & Beyond

echelon 3y ago
> Bed Bath & Beyond Is this why BBB failed? My perception is that the retailer was stuck in 2000. The stores always felt stuffy.
- cariaso 3y ago
  https://www.epsilontheory.com/the-united-states-of-bed-bath-beyond/ https://www.epsilontheory.com/the-united-states-of-bed-bath-... gives more details
- nerdponx 3y ago
  I used to really enjoy BB&B shopping. It was like Santa's Workshop of medium-quality products stacked floor to ceiling. And I liked their Wamsutta brand stuff years ago when the quality was still decent.
jeffreyrogers 3y ago
How would top management get rick quick with no exit? Equity presumably went to 0, so their compensation is the cash flow they got from their salary while Convoy was in business.
- dilyevsky 3y ago
  Not saying that’s what happened here but occasionally you can get money off the table by selling some of your equity during a funding round. Afaik that’s how Hopin and WeWork ceos got hundreds of millions despite their companies going to zero basically
- deleted 3y ago
  [deleted]
- dyeje 3y ago
  It is possible to sell some of your equity during funding rounds, they may have cashed out a significant amount along the way.
- encoderer 3y ago
  I have no knowledge specific to this company, but I did check and it looks like they last raised a “series e” round which suggests at least 6 rounds of funding. It’s grown pretty normal over the last ~10 years for investors to enable founders to sell some of their own shares, thus taking some of the round directly into their pockets. Normally called “taking money off the table” the idea behind it is that a founder with a successful company should be able to participate in the success without forcing an early exit that might not be best for the investors.
ToucanLoucan 3y ago
Arguably Bed Bath is better described as privateer capitalism: they were already on their way out in a big way and while there were certainly better avenues they could've taken, odds are they were going out of business anyway between the overall drops in brick and mortar spending among consumers combined with the pandemic drought. And in the end, what do we expect? The executive classes show up, buy their way into these firms that are struggling but have some intellectual/data/brand assets, and the executives slam them into the ground, sell the valuable pieces that fall out, and then sail away to buy their way into other businesses. I was always told growing up that if you failed in business you lost money but it seems once you get to a certain size of business, you can count on either free money from the Government to keep the ponzi-scheme that is our economy these days from toppling over dead, or at the very least, sell the scrap components of a business you didn't build for other companies to hoard until they too collapse.
- ghaff 3y ago
  Linens and Things was a pretty similar chain that went out of business quite a while before. My sense is that, while there are some more cooking-centric retailers that are still doing OK, broader (often optional) midrange home accessories and decor has been a tougher category.
dang 3y ago
Please don't post this sort of reflexive denunciation to HN. Posting like this breaks HN's guidelines, at least in spirit and arguably literally: "Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith." "Please don't post shallow dismissals, especially of other people's work. A good critical comment teaches us something." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html Of course, if you have specific information about fraud or other bad behavior in specific cases, that could be relevant to a discussion. But quoting something generic and then using it as an internet cynicism trampoline is quite a bit below the quality bar for what we're looking for in this forum. It just leads to repetitive, tedious, and ultimately ugly threads.
- deleted 3y ago
  [deleted]

echelon 3y ago

> Bed Bath & Beyond Is this why BBB failed? My perception is that the retailer was stuck in 2000. The stores always felt stuffy.

cariaso 3y ago
https://www.epsilontheory.com/the-united-states-of-bed-bath-beyond/ https://www.epsilontheory.com/the-united-states-of-bed-bath-... gives more details
nerdponx 3y ago
I used to really enjoy BB&B shopping. It was like Santa's Workshop of medium-quality products stacked floor to ceiling. And I liked their Wamsutta brand stuff years ago when the quality was still decent.

jeffreyrogers 3y ago

How would top management get rick quick with no exit? Equity presumably went to 0, so their compensation is the cash flow they got from their salary while Convoy was in business.

dilyevsky 3y ago
Not saying that’s what happened here but occasionally you can get money off the table by selling some of your equity during a funding round. Afaik that’s how Hopin and WeWork ceos got hundreds of millions despite their companies going to zero basically
deleted 3y ago
[deleted]
dyeje 3y ago
It is possible to sell some of your equity during funding rounds, they may have cashed out a significant amount along the way.
encoderer 3y ago
I have no knowledge specific to this company, but I did check and it looks like they last raised a “series e” round which suggests at least 6 rounds of funding. It’s grown pretty normal over the last ~10 years for investors to enable founders to sell some of their own shares, thus taking some of the round directly into their pockets. Normally called “taking money off the table” the idea behind it is that a founder with a successful company should be able to participate in the success without forcing an early exit that might not be best for the investors.

ToucanLoucan 3y ago

Arguably Bed Bath is better described as privateer capitalism: they were already on their way out in a big way and while there were certainly better avenues they could've taken, odds are they were going out of business anyway between the overall drops in brick and mortar spending among consumers combined with the pandemic drought. And in the end, what do we expect? The executive classes show up, buy their way into these firms that are struggling but have some intellectual/data/brand assets, and the executives slam them into the ground, sell the valuable pieces that fall out, and then sail away to buy their way into other businesses. I was always told growing up that if you failed in business you lost money but it seems once you get to a certain size of business, you can count on either free money from the Government to keep the ponzi-scheme that is our economy these days from toppling over dead, or at the very least, sell the scrap components of a business you didn't build for other companies to hoard until they too collapse.

ghaff 3y ago
Linens and Things was a pretty similar chain that went out of business quite a while before. My sense is that, while there are some more cooking-centric retailers that are still doing OK, broader (often optional) midrange home accessories and decor has been a tougher category.

dang 3y ago

Please don't post this sort of reflexive denunciation to HN. Posting like this breaks HN's guidelines, at least in spirit and arguably literally: "Please respond to the strongest plausible interpretation of what someone says, not a weaker one that's easier to criticize. Assume good faith." "Please don't post shallow dismissals, especially of other people's work. A good critical comment teaches us something." https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html Of course, if you have specific information about fraud or other bad behavior in specific cases, that could be relevant to a discussion. But quoting something generic and then using it as an internet cynicism trampoline is quite a bit below the quality bar for what we're looking for in this forum. It just leads to repetitive, tedious, and ultimately ugly threads.

deleted 3y ago
[deleted]