Gerard Vroomen was fed up with Cervélo. Not the bikes, or the customer service. Just the company. He felt it had gotten too big. Not an unusual complaint, perhaps, especially in a culture with a booming small-batch and bespoke market — except that Vroomen is a co-founder of Cervélo and was, at the time, serving as its CEO.
He resigned and partnered with Andy Kessler, onetime BMC CEO, to found Open bicycles. “The company had gotten to big for my liking,” Vroomen says. “I think the purpose of a company is to be the correct size, whatever that size may be. And for Open, that’s quite small.
“A lot of the innovation now is not a logical extension from what was there last year, but is a radical departure, and it’s coming from small companies,” Vroomen says.
Open cycles are dirt machines, ultra-light hardtail 29ers or super aggressive gravel hybrids. Because the company is small, it doesn’t need to sell a lot of bikes. Kessler and Vroomen can build the kind of bikes they want to ride. In doing so, they’ve set themselves up at the center of a small but dedicated community; owners send pics of their customized bikes, which Open posts to a showcase on its website — sort of a mom and pop model for the modern age.
And it’s working; they sell enough to get by, and have received a stack of good reviews. In a crowded market, they’ve found their niche.
Open is part of a roughly decade-old movement that is remaking the face of cycling as countless small brands come onto the scene, making frames, components, apparel, and accessories.
The manufacturing revolution that has enabled all this shares much in common with the forces behind the craft beer movement, Silicon Valley tech startups, and small-batch fashion brands. Those include social media networks and crowd-funding platforms like Kickstarter, which combine to give startups easy access to capital and a direct line to their customers; unprecedented access to manufacturing facilities in places like Taiwan and mainland China, even for small product runs; and rapid prototyping via technologies like 3D printing, which enable even single-person startups to create, innovate, and manufacture at what would have been considered industrial scales just a few years ago.
If you want to start a bike company, there’s never been a better time.
When Steve Domahidy co-founded Niner bikes in 2005, his business partner, Chris Sugai, thought it would be a small, side project, recalls Domahidy. Instead, they popularized the 29-inch wheel. “We were absolutely right place, right time,” he says.
Like Vroomen, though, he grew restless as Niner got bigger. So in 2014, he went back out on his own. This time he turned to Kickstarter and, with nearly $90,000 from 46 backers, launched Domahidy Designs, a small operation that sells steel and titanium mountain frames and recently released a carbon road option.
Though he says he got some flak for using Kickstarter — why would the founder of Niner need to resort to crowd-funding? — Domahidy defends his decision. It’s a way to raise funds without taking on investors, he says, as well as a way to connect with a community.
“Back in the ’90s and early 2000s you had to have all the capital to do ads and get all the spreads you could,” Domahidy says. “One of the reasons that the proliferation of small bike companies seems to be happening right now is a little bit because of the way that marketing has become this viral, social media aspect. The way that people can get their brand out there, especially if they have a unique and innovative idea, is a lot more viral.”
It’s working for Domahidy, who expects 2015 sales to run around 300 to 500 frames. And it’s working for a whole lot of other companies, who’ve taken to the web to fund and promote their efforts.
The founders of Helios, which makes a handlebar with an integrated headlight and turn signals, got their initial funding on Kickstarter ($120,106 from 678 backers). Four years ago, Revolights, which makes motion-triggered head and taillights, raised $215,621 from 1,442 backers and followed that up with a 2013 campaign for wheel lights that netted $94,793 from 233 backers. The company’s products can now be found at REI.
“[Kickstarter] gives so many more people access to having enough interest in their product and enough money in their bank account that they can take that step and try to make it happen,” says Revolights founder Kent Frankovich. “I think that is incredibly enabling.”
Additionally, direct-to-consumer marketing and sales are eroding the stranglehold of what used to be just a few major distributors. Take Alpine.cc, a clothing manufacturer that makes a small line of bibs and jerseys that sport laser cut seams, chamois that incorporate antimicrobial carbon filaments, race-cut tailoring, and other high-end accoutrements. For marketing, the company has enlisted “brand ambassadors,” people who are expected to ride a lot and post photos of themselves to Instagram — wearing, of course, the kits and socks they got from Alpine.cc. The company sells primarily online, direct to consumers, though it has also started selling through retailers who have reached out after seeing the brand on, yes, social media.
“Our biggest challenge right now is probably marketing, and trying to differentiate our product,” says Alpine.cc co-founder Jared Cooley. “A lot of companies can do this now; it seems like a lot of companies are doing it. So you have to really design your product to the person you’re selling to, because they can get on Instagram or the Internet and probably find four comparable kits that are pretty close quality-wise and price-wise.”
While the ability to raise startup capital and connect with customers via online platforms has definitely been a boon to potential bike-industry entrepreneurs, none of this transformation would have been possible without the opening of factory floors in places like Taiwan and China and the spread of manufacturing tools like CNC machines and 3D printers.
“Some of the parts we’ve had designed we’ve had 3D printed, and that has really sped up our time to bring things to market,” says Dave Weiner, founder of Priority Bicycles, which sells low-cost belt-drive commuter bikes. Printers have become ubiquitous, thanks in part to their rapid decline in price. In 2007, 3D systems made news when it released V-Flash, the first 3D printer under $10,000. Now, M3D and XYZ-printing each sell printers for $349.
Weiner worked in the bike industry for years before leaving to start a company that makes software for supply-chain management. With Priority he’s back into bikes, keeping prices low thanks to partnerships with manufacturing companies that share his vision, and thanks to consumer-direct sales made possible by consumers who are increasingly comfortable buying bikes off the web. “The power of the Internet is that anyone can find a factory,” he says. “Skype, WeChat, Line: they help a lot.”
Still, manufacturing is the hardest part for any startup. Finding a factory that’s reliable can be tricky, especially one making technically advanced products, points out Weiner, who was able to rely on contacts in the industry for referrals. That’s one of the reasons the founders of Helios enrolled in a hardware accelerator in San Francisco after they secured their Kickstarter funding. The program took them to Shenzhen, China, the Mecca of electronics manufacturing where brands like Apple make smartphones by the millions. It was there, while meeting with factory owners and learning about their manufacturing capabilities, that the team realized they could add Bluetooth integration to their bars for turn-by-turn directions. “A key component is getting to China, developing those factory relationships early on,” says Helios co-founder Antonio Belmontes.
Not only did the trip open up doors to manufacturing, it taught them how to design a product that factories can build — to know their scale, tooling, and what tolerances they’re capable of. Having founded Helios right out of college, Belmontes and his partners had no idea how any of that worked. But that they were able to quickly gain a working understanding of international supply chains and manufacturing is emblematic of this new industrial age. “[To go from] having no knowledge to being able to learn about it and actually come up with a prototype — to convey your vision — was much harder to do 10 years ago,” Belmontes says.
Among the many things that have gotten easier about that process is prototyping. Just a few years ago, to prototype a piece of hardware, you had to have it injection molded, which meant cutting giant steel tools for every iteration. It was prohibitively expensive — tools could easily run into the tens of thousands of dollars — and meant that only companies with access to enormous resources could bring new products to market. (There’s a reason the biggest new companies are digital ones like Facebook and Google, while hardware is still dominated by established companies like Apple and Samsung.) But this is changing in a hurry.
“Now you can by a 3D printer for under a $1,000 that’s pretty damn good, and you can print up your parts, iterate on it hundreds of times yourself,” says Frankovich, who built the first working Revolights prototype while he was a student at Stanford.
3D printing was also instrumental in the development of Kappius Components’ oversized hub/cassette system. Brady Kappius thought that if bike frames were getting fatter because larger-diameter tubes are stiffer and lighter, why not do the same with hubs? It turned out that the answer was because a bigger hub wouldn’t accept a cassette. So Kappius and his father, Russell, designed a system with hollow cogs that allowed them to move the wheel bearings further out and to expand the hub. It also left space for a new, faster, high-engagement drive system. They mocked it up in styrofoam and showed it to manufacturers. “Their last sentence was always, ‘That’s great, but it’s too crazy for us to take on,’” Kappius says.
So the father-son team decided to go it alone. To make their first proper prototype, they went the traditional route and hired a machinist. But by the time he finished, they had already bought a lathe, moved on to new versions of their design, and even started making the cassettes. And the steel parts inside the drivetrain were 3D printed, using a process called laser sintering, in which a laser fuses metal powder into a three-dimensional shape.
“The reason that this can happen is that the cycling industry is kind of stagnant,” Kappius says, explaining that it’s easier for individuals and small companies to take risks. “People are hesitant on doing something out of the norm, everybody wants something to be compatible. You don’t want to do something that would only work on one bike.”
Kappius Components has since expanded to sell carbon rims and full wheelsets, as well as a second-generation hub that works with standard cassettes. “As we go, our philosophy is, if there’s something on the bike that we can make better, it’s something that we’ll do,” Kappius says. “I don’t see us going out and making handlebars or seatposts, as easy as it would be to put our logo on it and make a buck off it. If there’s not something awesome about it, or progressive, it’s not something that we’re going to do.”
And, indeed, when anyone can launch a bike company, anyone can launch a bike company — whether or not they should. Regardless of how much interest an idea generates on Kickstarter, companies venturing into electronics or the competitive world of bike frames and components will eventually need engineers on staff. And even for those who can hire the best talent, the field is getting crowded.
“I think we’ve essentially reached market saturation,” Domahidy says. “That doesn’t mean there’s not room for any more players, but I feel like the space for that is dwindling.”
But there’s no denying that, right now, a simple good idea can take a person farther in the bike industry than ever before.
Nathan Hurst is a long-distance bike tourist, as well as a compulsive road and mountain biker. He is the features editor at Make: magazine.
FILED UNDER: Bikes and Tech