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I haven't managed a brand for 30 years, but I feel like I would be great in that role.
If hired for the role of product advisor at Kona, I promise to bring back a bike with 420mm chainstays, 26 inch wheels, and rasta colorway. For the culture.
He’ll also sell a ton of levos to well-off gen X’ers in California that grew up skateboarding. I guess they might already have that market cornered, but it can’t hurt.
Well you got the 2nd part of that down real good, and part 1 too for that matter. I would put you on my fantasy bike company board for sure.
I had a forced retirement not long ago... If you get on as a brand manager, keep me in mind.. 😆
lewis family takes sole ownership of live to play sports (norco).
https://www.vitalmtb.com/forums/hub/lewis-family-assumes-full-ownership…
I read that several shipping companies have shut down or closed some of their businesses. Did anyone notice it?
I also heard that several shipping companies have already filed for bankruptcy this year. But it has to be nothed that bankruptcy is often a last resort for logistics companies having financial difficulties, and in some cases, downsizing operations without filing bankruptcy can be a remedy for solving problems with high costs and expenses. So, it seems that some of them will be able to remain in the market. I often use lugless and I hope it will survive.
Maybe. They just completely backed out of Western North Carolina and Pisgah by selling all of the shops that they force purchased from multiple mom & pop owners.
They bought Motion Makers in Sylva, Cherokee & Asheville & Sycamore Cycles in Hendersonville and Brevard.
Then they almost immediately shuttered the Cherokee location.
Now they've sold the 4 remaining bike Specialized owned bike shops back to private owners, apparently all 4 to PeachTree out of Georgia.
When you went in any of those remaining stores while S still owned them, you should have seen the misery on their faces.
Troy Lee Buys Troy Lee Designs back from previous investor - from Vital MX
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Troy Lee has purchased his company, Troy Lee Designs, back, marking a poignant moment in the off-road industry. The following press release, received from Troy Lee Designs, explains the decision and transition.
Corona, California, July 31, 2024 – Troy Lee Designs is excited to announce a significant evolution in its ownership structure, moving forward as an independent company. This pivotal shift, by founder Troy Lee, backed by a world-class American family, marks a new chapter for the iconic brand.
With this new ownership status, Troy Lee Designs is set to channel its renewed energy into the Fall 2024 season and beyond. The company is committed to securing prominent positions in the bike and motocross helmet and technical apparel markets. Enhanced investments will enable Troy Lee Designs to deliver exceptional products, including helmets, technical gear, protection, and sportswear, to our valued dealers, distributors, consumers, and enthusiasts.
Troy Lee, the visionary founder and namesake, will continue to play a crucial role as the Chairman, strategic brand advisor, and inspirational leader of the renowned paint shop. "I'm incredibly passionate about our brand and our future. With strong leadership and dedicated partners, I'm stoked for what’s ahead. Peace & Wheelies!" – Troy Lee
Jon-Erik Burleson, CEO of Troy Lee Designs, expressed his enthusiasm: "Over the past nine months, with the invaluable support of 2 Ride, we have built a robust platform. As an independent company, we are now equipped to grow and unlock the full potential of the premium brand that Troy Lee Designs is destined to be."
A statement from 2 Ride Group: "2 Ride Group is very pleased to see Troy Lee Designs coming back to its iconic founder. The brand's return to independence should give it the agility it needs to strengthen its market positioning with an 'Art & Speed' approach. We wish them the greatest success!"
During the transition, Troy Lee Designs will assist 2 Ride Group portfolio brands with distribution across North America.
Troy Lee Designs is renowned for its quality and excellence in helmets, technical gear, protection, and sportswear. Originally celebrated for its unique helmet designs for top racers, the brand is distinguished by its unparalleled artistry, inspired by its famous paint shop, and reflected in its helmet and gear designs.
I'm intrigued to know what the definition of a "world class family" is.
Just a guess, but rumour of TLD/GasGas ending means maybe the company backing the team & carrying a large part fo the TLD ownership interest decided to back out of sponsorship and at the same time sell back majority interest to Troy as opposed to draining the team, vanishing in thin air and strong arming Troy out?
I think it's marketing talk for 'very bland investment group'
The Waltons?
The race team is a separate business entity from the gear business. Troy always retained ownership of the race team from my understanding. My guess is the company that bought equity in the gear business was interested in selling it and Troy had the opportunity to buy it back for a fraction of the price that he originally sold it at. Seems to be a common theme across sporting goods and outdoor brands at the moment if that’s the case.
My guess is "world class family" is synonymous with "single family office". What is a family office you ask? It simply means there is formalized central management of a highly wealthy family that actually employees people (sometimes like me) to help allocate their capital against the backdrop of the family's financial goals, estate planning, tax planning, philanthropic planning etc. To be clear, most family offices start around $100M and go up from there.
While there is a lot of variance as to how these family offices operate, they often act in the marketplace similar to a hedge fund or private equity fund, meaning they are equipped to directly buy stakes in companies like a PE/VC fund and/or deploy complex equities portfolio management practices that are akin to a hedge fund. Moreover, they have the capital to be a formidable player in whatever space they are operating. To be clear, this doesn't mean FOs are always out there actively managing capital in this manner. Most are going to deploy large amounts of capital into a high number of private funds, indices, ETFs, real estate holdings etc. but they always have the ability to go on the offensive and buy a business, back a founder and/or manage their own portfolio of equities/bonds. The big delineator is they are not allowed to take on capital from outside sources (its all family money, their buddies can't give them their money to manage, too - totally different legal structure/regs in that case).
TL;DR - I am speculating but based on this PR Troy didn't personally buy this asset back. A family office bought it and wanted to leverage Troy's "social capital" in the space. I'm sure there is upside for Troy himself, to be fair, but if we were to unravel the (private) deal details, I'm highly doubtful this looks like "troy just bought his business back".
Now, the bigger trend in the space are all those with cash on hand going deal shopping. Multiples have contracted on top every company in the outdoor industry coming off "worst" type of years with a number facing a liquidity crisis (point of this thread!). This means its basement level pricing (last years revs/net profit/ebita is low + the multiple is lower relative to the last 10+ years). Blood is in the water and sharks are hunting. Ironically, its still the bike industry so hardly some money printing machine, but interesting to a guy like me nonetheless.
Never thought I'd see a discussion of single family offices on Vital.
I'm not in finance, but I watch the money-management side of family offices from a nearby professional perch. If an owner is going to sell their business, often the best outcome for the employees and customers of that business is a sale to a large, well-established SFO. It avoids many of downsides to hedge funds and private equity, of which there are legion.
A large, well-established SFO that has survived past the death of generation that was running the show when the liquidity-event occurred and has outside (nonfamily) management is often not looking to make money by selling the business in 5-10 years. They are operating a long-term time horizon and trying to make money by actually running the business well. And they are generally pretty good at it.
There is not a lot of information on PON (Santa Cruz and OneUp), but PON seems to be such a SFO. This is why it is highly unlikely PON f*cks it up with SC and Rob owns the company again in 5-10 years. But . . .
SC never abandoned the threaded BB, held out for a decent bit on routing the brake hose internally, and was one of the first to make bikes without a front derailleur. I'd wager those decisions didn't involve spreadsheets or people in Midtown Uniforms. But now that PON owns SC, decisions on things like whether to offer cable routing are much more likely to be made based on spreadsheets and financial metrics.
100% agree - SFOs are often (but not always) awesome for the longevity, durability and overall path of a company. Many of the perverse incentives often associated with PE/VC/private funds are absent or at least highly muted.
Any of this fire sale stuff affecting bike media outlets the way Donut Media and others are being affected by purchase from outside investors? The Pepto Bismol site sure…but any others getting “purchased “ ?
Tweedlove events shutting down.
https://tweedlove.com/blog/the-end-of-the-road-for-tweedlove/
Some comments on how changes in Enduro affecting these regional events.
Both the PMBA and SES (race organizing bodies) have folded in the Uk.
Hearing local rumor that TGR has let go of every employee and is shutting down all retail locations. Not exacty a bike company, but they have made bike movies and are very much "in the scene". I haven't followed their path as closely as I should have considering they are in the backyard, but if memory serves PE money came in at some point, which led to an attempt to brand hotels with the TGR logo, and a number of retail establishments selling hats/tees popped up. Word is they are going back to their roots, founders retain control and very light/minimal staff.
I sense a theme...
Crazy about TGR, but they’ve definitely gone the fast fashion insane production cycle route of cranking out tons of releases and products. Kind of reminds me of the route Fasthouse is going (though TGT is obviously much bigger).
As seen on the other site - https://www.pinkbike.com/news/ohlins-restructures-its-mtb-department-amid-layoffs-reaffirms-commitment-to-racing.html
While I know its easy to jump on the "this is because Apollo owns the brand they are cutting costs" bandwagon, and I'm sure there is truth to Apollo looking a little more short term than a generational founder might, I think we can all agree seemingly every company has had to trim fat no matter who owns the firm. This is not bike specific, btw. Its across the board.
Personally I'd hate to be in the mountain bike suspension manufacturing game. It has to be really challenging. Every company offers pretty aburd warranty relative to any other industry (you get 30 days on a moto for instance), the engineering is complex, manufacturing requires crazy tolerences all things considered, assembly less than easy and the supply chain involves multiple countries, materials, etc.
I'm frankly pumped we have all the options we do, at the prices we do, despite the fact I'll continue to complain about durability being poor (with respect to forks anyway)
I wouldn’t be surprised if we got more layoffs and companies shutting down in the bike industry in 2025 compared to 2024. It seems like a lot of companies across the bike food chain are having trouble getting rid of old stock and it doesn’t sound like new products are selling well either. It also seems like most of the industries that typical average joes work in are starting/continuing to get hit with layoffs with not much hiring/growth expected for the rest of the year (at least in the states). Adding in the high inflation we’ve been seeing and little technological advancement in the bike industry over the last 5 years; I don’t think customers are going to be able, or willing, to buy much new product outside of the usual consumables. It feels like a lot of the companies hanging on by a thread this year will hit the end of the road.
I don't disagree with this at all. Few more thoughts (I really should just make this a podcast or something lol)
1) Its really hard to decouple the emotion from the business and be pragmatic when shutting something down, especially when there is still a little money left in the bank.
2) The levers those in power pull on have huge lag times. IE, what the Fed does with respect to interest rates is akin to trying to turn left and then the car does so like 10 miles down the road. Slowly. We are finally feeling the real effects of higher rates, which does appear to be squashing inflation but the hit to the jobs side of thing is a lot bigger than I think the numbers show. Of course the bike industry will continue to be impacted by this because outside us lunactics, who would rather starve than not ride, most people are going to forgo their bike/component/fun time purchase.
3) A long time ago one of the big mags made some predictions in the mtn bike space. One recurring prediction was that of consolidation, something more akin to moto. I think we're finally (really) seeing this with the likes of Specialized, Trek, Santa Cruz etc capturing so much of the market and really leaning into scale economies its going to be harder and harder for the little guys, especially frame companies, to keep up. I know I've made this argument before, but it seems truer and truer every year. You can amortize costs a lot easier if you sell 10,000 of something as opposed to 100 of something....and margins ARE under pressure.
VitalMTB's The Inside Brine podcast, coming soon.
I'd listen!
Also, can't upvote this enough "...who would rather starve than not ride..." 😅
https://www.instagram.com/p/C-p2hjCvgpJ/?igsh=dTUyemJrNHN5bDZn
For those without Insta:
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