Seattle-based trucking startup Convoy is shutting down after failing to find an acquirer.

CEO Dan Lewis told employees in a memo that “a massive freight recession and a contraction in the capital markets” resulted in the company’s failure.

The remaining employees received no severance and were informed their stock options were now worthless, GeekWire reported.

The company was valued at $3.8bn only 18 months ago and was backed by the likes of Bill Gates, Jeff Bezos and Salesforce CEO Mark Benioff.

In 2018, Convoy raised $185m in a funding round led by CapitalG at a $1bn valuation. In 2019, the company raised $400m in a round led by Generation Investment Management and T Rowe Price.

A worsening venture capital climate and falling prices are beginning to hit logistics startups as the freight industry slows down.

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Digital freight forwarder Flexport slashed its workforce by 20% earlier this week and warehouse startup Flexe laid off 33% of its staff in September.

The pandemic revealed multiple inefficiencies in supply chains that logistics startups then rushed to solve.

Venture capitalists have invested almost $7bn into the supply chain technology sector since 2018, according to data from analytics firm GlobalData. Of that, $2.46bn was raised by the sector between 2020 and 2021. However, that’s still down from the peak of 2019 when 240 deals injected $2.99bn into the sector.