Will more companies be shutting down in the next 12-24 months?

12/21/2024 7:51am
From what I heard guerilla gravity’s problem is they had an investor with no interest in weathering the impending storm that the bike industry is in...

From what I heard guerilla gravity’s problem is they had an investor with no interest in weathering the impending storm that the bike industry is in now.  Reeb on the other hand is a passion product of someone who doesn’t have to worry about money.  They do not need to grow or even be profitable.  Much like the athertons who can rely on sponsorships for their personal income.  Atherton and reeb bikes doesn’t need to make a dime in their lifetime.  They can afford to put every bit of revenue back into the company and better yet can trade on their name to find similarly minded investors whose interest is more or less creating something cool rather than being cool to sell something.


The choice of modular frames and their carbon construction method was unique.  I think barelli was a great choice in an ambassador (much like lenosky is for reeb).  Their ala carte method to bike builds was pretty well done.  I have seen a lot of ggs with a push on it.  Ultimately I think they were doing a lot of things right to differentiate themselves in a crowded market.

One other issue in the  GG plan.. With the whole Revved carbon deal, they were hoping to become a manufacturer for other companies that wanted to...

One other issue in the  GG plan.. With the whole Revved carbon deal, they were hoping to become a manufacturer for other companies that wanted to have a Made in the USA carbon bike to sell... I don't think that they got any takers on that, at  least not that I know of.. 

The only issue I saw with the modular design was as an enduro or heavy duty trail bike, it was fine.. But, in the shorter travel Trail Pistol set up, it was definitely on the heavier side of things. A friend of mine had one, it was sick.. 

What I heard the company was essentially split into a technology side (which is or at least was doing some work for some stateside brands post split) and the bike brand which was liquidated.  And I’d bet there was some financial finagling involved in that decision as well:

2
1
Rick26
Posts
41
Joined
12/5/2022
Location
., QC CA
12/21/2024 5:33pm
I know this may sound crass, but the Rocky Mountain announcement, much like the GT announcement, doesn’t surprise me. Consolidation in the specialty cycling space has...

I know this may sound crass, but the Rocky Mountain announcement, much like the GT announcement, doesn’t surprise me. Consolidation in the specialty cycling space has been anticipated for a long time. This consolidation doesn’t always mean brands acquiring other brands; it can also result from major players like Specialized or Trek dominating enough of the market to squeeze out mid-sized competitors. If a brand fails to offer something truly compelling—whether that’s performance, price, brand equity, reliability, or innovation—it’s going to struggle. Unfortunately, the nature of economies of scale makes this consolidation almost a self-fulfilling prophecy.

To draw a parallel (albeit a slightly apples-to-oranges one), consider Intel’s struggles relative to Nvidia over the last decade. Resting on your laurels and failing to adapt opens the door for competitors to overtake you. Love them or hate them, it’s hard to argue with how effectively Specialized and similar brands have executed their strategies over the past five-plus years and how compelling the value prop is from these types of companies. Everyone has to sell at the same price(ish), but Specialized is going to sell a lot more bikes, and their COGS is likely lower than say, Transistion. 

Regarding model year cycles, I’ve touched on this before (including on the podcast), and I completely agree with the sentiment here: they need to be longer. With performance reaching a plateau, longer cycles allow companies to amortize costs over extended periods and, in turn, reduce risk—provided they launch products that truly resonate with the market. Longer cycles also require companies to be more deliberate about what they bring to market. Margins are tighter, and it’s harder to sell in this environment, but if you do hit the mark, the product can generate revenue for a longer period.

Lastly, I’m confident that PON employs many smart individuals. They may not always make perfect decisions, but I guarantee someone there has a solid grasp of cost-based accounting and financial analysis. GT has probably been on the chopping block for years, and their only regret might be not making the decision sooner.

Masjo wrote:
One thing that this made me think of with respect to Rocky was their desire to make their own e-MTB motor/battery and not take an off-the-shelf...

One thing that this made me think of with respect to Rocky was their desire to make their own e-MTB motor/battery and not take an off-the-shelf model from Shimano, Bosch, or others. I thought I remember this being a thing, though I see they license the unit from another Canadian company called Dyname who seem to only supply Rocky. Was this maybe a step too far for a medium sized company? It could have been something revolutionary in that Rocky would get to keep more of their sales dollars from the ever-growing e-bike market, but maybe they just don't have the size or capital to offset the bill that this comes with versus using an existing system like Bosch or Shimano.  

Primoz wrote:
I've heard a few things about mid-drive drive unit development and the challenges over the years as two of these units were developed in Slovenia and...

I've heard a few things about mid-drive drive unit development and the challenges over the years as two of these units were developed in Slovenia and with the country being that small, it's easy for information to spread around the community.

As alluded to in the Tech rumours topic regarding wireless piggyback dropper post actuator development, when it comes to electronics (or mechatronics), things get a lot more complicated than with simple mechanics. You need a good sized company to do a mid-drive unit as it requires the development of a motor, the geartrain (dropping the revs to the crankarm rotational speed), torque sensing, you need to implement the spindle with the torque sensing and have the bearings very well sealed, you need control electronics and the software on it, some sort of casing (usually cast aluminium with the bigger guys) and you need to develop all of that. You need to make it reliable and predictable, which means calibration of the SW as to how the motor engages is an important (and not an easy) thing. If at all possible, you need to develop the BLDC motor and do the winding in house, if you're buying the rotor and stator, you are beholden to what an off the shelf supplier can offer (not really sure how much of that is available vs. standard brushed motors) so I'm guessing you really want to do something on your own to be free design wise. Quite a few of the mid-drive units were at least initially (if not anymore) based on existing automotive BLDC applications, like electric power steering motors, electric oil/water pumps, etc.

While this gives you a lot of freedom (Rocky for example uses a standard BB and crankset with the drive unit decoupled - surely a way to make the drive unit easier to develop) if you do it for your own bike only, it's a HUGE cost that can be covered only by large numbers - did anyone else actually do a motor only for themselves besides Rocky and Specialized with the SL line?

This covered only the drive unit, you then also have the batteries and the controls that you need to develop which is a whole other undertaking besides this. Doing all of this from a garage would require a VERY special set of people with some very interesting financing to make it happen, but in reality I can see it being done only by really large companies. I work for an automotive supplier with yearly revenue of around 100 million € and while I think we are on the cusp of being capable of doing a drive unit in house (we deal with these kinds of stuff, so we have the general knowhow, suppliers and the production and measuring equipment). It would take 3 years of development too. Plus the batteries (and controls to some extent) are a mystery to us plus with the market the way it is, there is no hope of actually penetrating it as an unknown supplier from 'eastern' (actually central) Europe. If some people have doubts about DJI, we would get laughed at by basically everyone.

I believe Rocky Mountain are still alone making their own drive unit.

The Specialized SL units you're referring to are made by Mahle and Brose are making their full power motors.

6
Primoz
Posts
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SI
12/22/2024 12:23am Edited Date/Time 12/22/2024 12:24am

Developed by MAHLE (in Slovenia), including the assembly line and testing of it (run at rate or something along those lines), then the whole thing was shipped overseas. Not sure where to and how the agreement is like, it could be in one of MAHLEs factories overseas, but the information I have is that Specialized took over the assembly line when it was done. And I'm quite sure they are the owners of the developed design. 

Brose is the supplier for full power motors, but Specialized is not the only customer for Brose. They are the sole users of the SL motors. That is the distinction I was trying to make. You can get Brose to supply you motors, you cannot get SL motors if you are not Specialized. 

7
Maxipedia
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Location
Brașov RO
12/22/2024 7:42am

I ride a Rocky Mountain e-bike and it has done two things to me:

1. bring my joy for riding back
2. make me buy another Rocky Mountain, a Slayer, which I also love

Regarding point number one, it is my far the best e-bike I have ever ridden and it isn't about the fact that it has that extra torque, but how the power is delivered, how balanced it feels, how the motor is integrated in the frame, how you benefit from that weight that is positioned lower, how well the suspension works, how good the geometry feels etc. I bought it by circumstance, but it turned me into a believer. And I was happily riding a Bosch e-bike before and was fond about the Turbo Levo as well. But this set new standards for me, that are still to be reached. By Bosch's new motor, among other things.

I felt the need to write the above, because I see people question Rocky for doing their own motor and how that somehow translates to kind of an arrogance and the next thought that is kinda suggested is that they have ”deserved it”, just for doing this. As if it is a bad thing to produce everything that you can under your own umbrella, when you have the means to do it. From my understanding, the company that made and developed the motors for Rocky is under the same parent company as them.

Otherwise, I totally dig when people talk about the high prices of high end bikes these days, but what I can't understand is why just some companies are being thrown shade at. I mean, why is it a problem that Rocky costs what it costs, but it is no issue when a Santa Cruz, Pivot or Yeti does just that, not to mention a boring S-Works??? BTW, from the list above, SC, Pivot and Specialized are made in the Far East too. So aren't the people who are whining about Rocky Mountain bikes costing ”so much” just hypocritical and using a double standard?

Oh, and speaking of quality and finish and overall feel, the two carbon Rockies I own are better than most of the other carbon bikes I have had contact with until now, including Santa Cruz and Pivot. But this is just subjective, I know.

Mx

15
12/22/2024 10:42am
Maxipedia wrote:
I ride a Rocky Mountain e-bike and it has done two things to me:1. bring my joy for riding back2. make me buy another Rocky Mountain...

I ride a Rocky Mountain e-bike and it has done two things to me:

1. bring my joy for riding back
2. make me buy another Rocky Mountain, a Slayer, which I also love

Regarding point number one, it is my far the best e-bike I have ever ridden and it isn't about the fact that it has that extra torque, but how the power is delivered, how balanced it feels, how the motor is integrated in the frame, how you benefit from that weight that is positioned lower, how well the suspension works, how good the geometry feels etc. I bought it by circumstance, but it turned me into a believer. And I was happily riding a Bosch e-bike before and was fond about the Turbo Levo as well. But this set new standards for me, that are still to be reached. By Bosch's new motor, among other things.

I felt the need to write the above, because I see people question Rocky for doing their own motor and how that somehow translates to kind of an arrogance and the next thought that is kinda suggested is that they have ”deserved it”, just for doing this. As if it is a bad thing to produce everything that you can under your own umbrella, when you have the means to do it. From my understanding, the company that made and developed the motors for Rocky is under the same parent company as them.

Otherwise, I totally dig when people talk about the high prices of high end bikes these days, but what I can't understand is why just some companies are being thrown shade at. I mean, why is it a problem that Rocky costs what it costs, but it is no issue when a Santa Cruz, Pivot or Yeti does just that, not to mention a boring S-Works??? BTW, from the list above, SC, Pivot and Specialized are made in the Far East too. So aren't the people who are whining about Rocky Mountain bikes costing ”so much” just hypocritical and using a double standard?

Oh, and speaking of quality and finish and overall feel, the two carbon Rockies I own are better than most of the other carbon bikes I have had contact with until now, including Santa Cruz and Pivot. But this is just subjective, I know.

Mx

there is generally nothing 'special' about a rocky mountain though and i think thats why people hate on the price.
 Santa cruz atleast offer their lifetime warranty and just work.
Pivot, i agree, they are overpriced asf, their fit and finish it really nice though.

Yeti's sb150 put them in a good place for a good 'do it all' and with infinity link they seem to have a loyal fanbase.

sworks.... well lets be honest, unless you got the frame via warranty they are a terrible choice and some bikes like the Stumpy EVO... the frame is the exact same except 1 carbon linkage

2
4
metadave
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Location
CA
12/22/2024 11:34am

I think Rocky still carries some of that "general bike company" feelings with some people. If you asked me 12 years ago if I'd buy a Rocky I'd have looked at you like a crazy person, they were more boring than Jamis other than DH and freeride bikes. Now they've been my last 3 bikes and I'm currently looking at the new Element. Yeah I work at a shop that sells them, but I have 5 other brands to pick from as well as other brands that still give industry deals that are most of the rest listed as high end options. I've picked Rocky for a reason, the last 8 years, what they've done in the small details is fantastic and the way they ride is 👌and as much as people complain about their pricing, their A and C70 models usually have full aftermarket parts spec, pre-installed cushcore/proper tires that are model dependant, full XT, fox factory. And the A30 models are usually pretty damn cheap with as good a build as you can get for that pricing.

When I was building my current Altitude, I realized they started doing new stuff for the first time, like small details that other high end brands don't, such as the fully routed internal cables and hose tubes where the rear brake tube is actually split just under the storage door, with separate tubes leading up to the front ports for regular or moto brake routing to keep things clean. You're not doing that on a Yeti. 

Their ebikes having almost completely serviceable drivetrains, with even replaceable motor controllers and serviceable drive chains is unlike anyone else in the industry. I ride them because they're doing stuff right. I hope they get through this intact and keep doing what they're doing because I think they're finally breaking out of that "boring bike company" stigma completely with the new line. 

15
Suns_PSD
Posts
211
Joined
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Location
Austin, TX US
12/22/2024 12:34pm Edited Date/Time 12/25/2024 1:14pm

I've been honing in on RM bikes for a few years as I watched them build the arguably best Enduro style bike in the Altitude & the best Downcountry bike in the Element. Adjustable, great geo, the right rear suspension, lightweight frames, etc.

Lately they have released the most interesting mid power e-bike with the Instinct SL. Most powerful mid power, largest battery pack + a huge RE, Adjustable Reach and their Ride 4, MId/ high pivot design with the best power delivery, competitive weight for the included features. I see it as a solid step up from my Relay, once set up BC style as a 150/ 160 MX.

The bikes seem worth the premiums that they ask. Before all of the BK business I was actively shopping for a deal on the Instinct SL.

Regarding deal shopping, in the past I always just bought the bikes I wanted and didn't worry much about scoring a discount, but frankly I'm tired of losing thousands within just months over and over. This time, I'm waiting for that discount.

3
Maxipedia
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379
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Location
Brașov RO
12/22/2024 1:03pm
metadave wrote:
I think Rocky still carries some of that "general bike company" feelings with some people. If you asked me 12 years ago if I'd buy a...

I think Rocky still carries some of that "general bike company" feelings with some people. If you asked me 12 years ago if I'd buy a Rocky I'd have looked at you like a crazy person, they were more boring than Jamis other than DH and freeride bikes. Now they've been my last 3 bikes and I'm currently looking at the new Element. Yeah I work at a shop that sells them, but I have 5 other brands to pick from as well as other brands that still give industry deals that are most of the rest listed as high end options. I've picked Rocky for a reason, the last 8 years, what they've done in the small details is fantastic and the way they ride is 👌and as much as people complain about their pricing, their A and C70 models usually have full aftermarket parts spec, pre-installed cushcore/proper tires that are model dependant, full XT, fox factory. And the A30 models are usually pretty damn cheap with as good a build as you can get for that pricing.

When I was building my current Altitude, I realized they started doing new stuff for the first time, like small details that other high end brands don't, such as the fully routed internal cables and hose tubes where the rear brake tube is actually split just under the storage door, with separate tubes leading up to the front ports for regular or moto brake routing to keep things clean. You're not doing that on a Yeti. 

Their ebikes having almost completely serviceable drivetrains, with even replaceable motor controllers and serviceable drive chains is unlike anyone else in the industry. I ride them because they're doing stuff right. I hope they get through this intact and keep doing what they're doing because I think they're finally breaking out of that "boring bike company" stigma completely with the new line. 

Reading this and especially the ”general bike company” part made me think of the following: 

1. people on forums, social media and commentary sections whining that bikes are too gimmicky and that model changes are too often gratuitous 
2. bike company is doing nothing fancy, no gimmicks, just honing on a proven formula, that has made their product appreciated by those who used it
3. people on forums, social media and commentary sections whining that bikes of said company don't have enough gimmicks, features and ”novelty”
4. the end

Over here I've had some interesting reactions from people observing my Rocky, most of them ignorant to the brand. Take into consideration that a lot of beginners and newbies here ride Rockrider, a Decathlon brand, some of the cheapest bikes out there. Some people think it's ”a Rockrider”. Others said ”the bikes don't look like anything special”, meaning they are not spectacular enough. The last segment are the ones who know heritage, observed the evolution of the bikes and maybe the success of the enduro team. I got congratulations from this demographic. Oh, and there are the ones who don't notice my Instinct is an e-bike and are amazed the second they find out. Smile )) Long story short, on these shores Rocky remains a brand for people in the know.

The obvious conclusion is that people will always want not only the best bang for their buck, but also the newest tech, just for the sake of it, even if they can't exactly say or feel how it benefits them. It jsut has to be there. Better have a faulty product but with the newest shit than something proven but more boring, I guess...

Mx

4
brash
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AU
12/22/2024 5:12pm

skip to 10m 30sec, Seth makes a good point here. Puts the companies on blast a bit.

 

9
kperras
Posts
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12/19/2012
Location
CA
12/22/2024 6:02pm Edited Date/Time 12/30/2024 12:25pm

Lots of nice comments about Rockys; I certainly appreciate it. 

I have faith that something will transpire over the next few months and Rocky will emerge on the other side a better company. The brand is very strong and there are many passionate but also smart people that want to see it carry on. In the meantime I'll be skiing and biking for the remainder of the winter. 

21
1
12/23/2024 7:17am
Maxipedia wrote:
I ride a Rocky Mountain e-bike and it has done two things to me:1. bring my joy for riding back2. make me buy another Rocky Mountain...

I ride a Rocky Mountain e-bike and it has done two things to me:

1. bring my joy for riding back
2. make me buy another Rocky Mountain, a Slayer, which I also love

Regarding point number one, it is my far the best e-bike I have ever ridden and it isn't about the fact that it has that extra torque, but how the power is delivered, how balanced it feels, how the motor is integrated in the frame, how you benefit from that weight that is positioned lower, how well the suspension works, how good the geometry feels etc. I bought it by circumstance, but it turned me into a believer. And I was happily riding a Bosch e-bike before and was fond about the Turbo Levo as well. But this set new standards for me, that are still to be reached. By Bosch's new motor, among other things.

I felt the need to write the above, because I see people question Rocky for doing their own motor and how that somehow translates to kind of an arrogance and the next thought that is kinda suggested is that they have ”deserved it”, just for doing this. As if it is a bad thing to produce everything that you can under your own umbrella, when you have the means to do it. From my understanding, the company that made and developed the motors for Rocky is under the same parent company as them.

Otherwise, I totally dig when people talk about the high prices of high end bikes these days, but what I can't understand is why just some companies are being thrown shade at. I mean, why is it a problem that Rocky costs what it costs, but it is no issue when a Santa Cruz, Pivot or Yeti does just that, not to mention a boring S-Works??? BTW, from the list above, SC, Pivot and Specialized are made in the Far East too. So aren't the people who are whining about Rocky Mountain bikes costing ”so much” just hypocritical and using a double standard?

Oh, and speaking of quality and finish and overall feel, the two carbon Rockies I own are better than most of the other carbon bikes I have had contact with until now, including Santa Cruz and Pivot. But this is just subjective, I know.

Mx

A Volvo costs as much as BMW, Mercedes, Audi but don't have the bling factor or perception of high performance that those 3 do. Rocky = Volvo in this analogy. Not knocking Volvo or Rocky I'd buy either one! (used)

3
jeff.brines
Posts
923
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Location
Grand Junction, CO US
12/23/2024 7:34am
Rick26 wrote:
EY just posted their monitor's report on Rocky Mountain.https://documentcentre.ey.com/api/Document/download?docId=41043&language=ENThe group is currently carrying a $68.7 million debt.

EY just posted their monitor's report on Rocky Mountain.

https://documentcentre.ey.com/api/Document/download?docId=41043&languag…

The group is currently carrying a $68.7 million debt.

image 115.png?VersionId=Jjm874G

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

22
Primoz
Posts
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Location
SI
12/23/2024 7:35am

They also don't have the douche factor (and other stereotypes) associated with them which can't be said for the three German brands... A Volvo is just a Volvo. It's what Saab was 25+ years ago.

4
Mwood
Posts
115
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8/19/2009
Location
Bay Area, CA US
12/23/2024 8:11am
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

But what if the enginers come to you with a sick downcountry rig with crab link and no pedal kickback, would you as a rider say no to trying it out/taking the $ risk? 

With CFO role, always felt there needs to be a bit of firewall, but also a true understanding of the actual product/market its being sold into. 

6
Sesame Seed
Posts
214
Joined
6/25/2014
Location
Farmington, CT US
12/23/2024 9:19am
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

If you even think everyone is reading all this, all the time you're crazy.  

Brevity to you & yours.

44
12/23/2024 9:27am
Rick26 wrote:
EY just posted their monitor's report on Rocky Mountain.https://documentcentre.ey.com/api/Document/download?docId=41043&language=ENThe group is currently carrying a $68.7 million debt.

EY just posted their monitor's report on Rocky Mountain.

https://documentcentre.ey.com/api/Document/download?docId=41043&languag…

The group is currently carrying a $68.7 million debt.

image 115.png?VersionId=Jjm874G
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

This just goes to show there are intelligent people capable of helping this industry, but brands generally do not seek them out. 

I feel the same way about marketing (my area of work). Very few brands are using any kind of modern intelligence in their marketing departments. 

5
veefour
Posts
599
Joined
7/31/2016
Location
Cinderford GB
12/23/2024 9:57am Edited Date/Time 12/23/2024 10:01am

If you even think everyone is reading all this, all the time you're crazy.  

Brevity to you & yours.

Personally I'd say most of us subscribed to this thread do. If you find his posts too long winded then fair enough, don't read them, but for me Jeff brings great insight and knowledge to the thread, he's certainly given me a better understanding of the financial side of the bike world.

 

31
12/23/2024 10:04am Edited Date/Time 12/23/2024 10:05am
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

If you even think everyone is reading all this, all the time you're crazy.  

Brevity to you & yours.

I read it all.

I read all of his posts. They're interesting, Jeff seems knowledgeable, and any insight into the machinations of that world are thought provoking.

I have very little interest in or ability to take part in big money finance or business. But I'm curious. I like to understand why people do what they do, why things that seem obvious aren't obvious, and why things that seem complicated aren't so complicated.

It's pretty telling that you took an opportunity to fire a dart at someone in an attempt to posture some self-assumed dominance over someone else when the easiest thing in the world to do would have been to just move on. Second easiest would have been to close the window. Third easiest would have been to go get a glass of water. You kept rummaging through the bucket of most useless things a person could do and eventually - satisfied with what you found - proudly displayed flaccid competition.

Cool.

21
dolface
Posts
1327
Joined
10/26/2015
Location
CA US
12/23/2024 10:15am

If you even think everyone is reading all this, all the time you're crazy.  

Brevity to you & yours.

veefour wrote:
Personally I'd say most of us subscribed to this thread do. If you find his posts too long winded then fair enough, don't read them, but...

Personally I'd say most of us subscribed to this thread do. If you find his posts too long winded then fair enough, don't read them, but for me Jeff brings great insight and knowledge to the thread, he's certainly given me a better understanding of the financial side of the bike world.

 

Seconded; I find the topic fascinating and am grateful to Jeff and the other contributors for sharing their knowledge and opinions.

15
DServy
Posts
119
Joined
5/28/2015
Location
Jackson, WY US
12/23/2024 10:30am
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

If you even think everyone is reading all this, all the time you're crazy.  

Brevity to you & yours.

Is your attention span that low that you couldn't sit through the 30 seconds it takes to get through his post? Like I'm not even sure HOW he could make it much more compact without missing out on key detail.

Thanks for your thoughts @jeff.brines as always! 

12
ballz
Posts
89
Joined
7/30/2024
Location
Ouagadougou EH
12/23/2024 10:52am
Primoz wrote:
They also don't have the douche factor (and other stereotypes) associated with them which can't be said for the three German brands... A Volvo is just...

They also don't have the douche factor (and other stereotypes) associated with them which can't be said for the three German brands... A Volvo is just a Volvo. It's what Saab was 25+ years ago.

Where I live, Volvo dealerships are the douchiest and shittiest of them all, and it is one of the reasons I will never drive a Volvo again. I hope RM isn't even remotely similar.

1
12/23/2024 11:50am
Rick26 wrote:
EY just posted their monitor's report on Rocky Mountain.https://documentcentre.ey.com/api/Document/download?docId=41043&language=ENThe group is currently carrying a $68.7 million debt.

EY just posted their monitor's report on Rocky Mountain.

https://documentcentre.ey.com/api/Document/download?docId=41043&languag…

The group is currently carrying a $68.7 million debt.

image 115.png?VersionId=Jjm874G
Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of...

Good find! The income statement alone doesn’t tell the whole story, and we really need more context to piece together what went wrong. Unfortunately, some of the key financials I was itching to see are “sealed” in the full document. That said, there’s still plenty of useful information in the PDF—and yes, I did wear my Patagonia vest today.

Profitability

Rocky wasn’t particularly profitable even in 2022, and things fell apart in 2023 and beyond (as shown by net income, which doesn’t give the full picture but is telling). This is surprising, considering 2020–2022 were peak COVID years. For context, 2022 was a record-breaking year for companies like Fox Factory, both in revenue and profit. This makes me scratch my head a bit... 

Revenue Growth

Interestingly, Rocky managed to grow its revenue into 2023—even as the COVID tailwind started to disappear (that said, their fiscal year ends in June, so this is a little misleading). What’s more, they also grew gross income, which suggests they weren’t just discounting their bikes to move inventory. Unfortunately, they still weren't profitable because... (see next bullet...I think anyway).e

The Big Hit

One glaring issue is the $17.8 million loss tied to a failed e-bike venture aimed at supplying bikes and parts to a bike-sharing company. This has “startuplandia gone wrong” written all over it. That debacle likely forced the company to increase its debt substantially in 2023, crushed profitability, and left an overhang heading into 2024. It's a good example of a silly high-risk move without the right safeguards in place.

CFOing

This is where I get on my soapbox: the outdoor industry (and beyond) has a serious need for real CFOing. A good CFO isn’t just a glorified accountant; they’re a strategic "financial risk" gatekeeper, ensuring that capital allocation is disciplined and risks are manageable against a range of possible futures. The right CFO puts processes, controls, and tools in place to enable sound decision-making.

Looking at Rocky’s trajectory, it’s clear they could’ve used that kind of leadership. Missteps like the e-bike venture, unchecked debt growth, and a lack of profitability discipline scream for a CFO who could say “no” when needed and push for better financial rigor. Instead, it feels like they didn’t have the right guardrails to handle the headwinds.

PS...

On that note, this is why I’ve been exploring the idea of a fractional CFO firm, aiming at the outdoor space. Companies like Rocky likely don't need a full-time CFO, but they do need experienced financial leadership. By coming in part-time—with a team of finance experts (I've recruited people smarter than me) and tools—we can provide cost-effective, high-impact guidance. No idea how this will play out, but the need for sure is there.

 

Surely Rocky are large enough to have a CFO full time. It's a company with 70m+ revenue each year, I'd certainly want someone employed to safeguard the risks that come with selling consumer products to that amount. 

The largest business I've worked for had revenues of 3 million, and we even paid for modelling of potential downturns and profitability forecasts in the event of input costs unexpectedly rising, because we wanted some level of knowledge of the risks to our investment. 

 

5
12/23/2024 11:52am

It's as if the internet discovered this year that some bike companies are badly run and most of them could be considered short-lived

8
12/23/2024 10:59pm Edited Date/Time 12/23/2024 11:00pm

Several MTB brands have had this issue, they had to lock orders in and they still got made regardless.

Pivot, Specialized, trek(Ebikes not selling either), bold, commencal and rocky(apparently)  all got smashed, Giant Have a sh1t ton of Ebikes to sell before Giant & yamaha can launch their new ebike.

Giant, YT, Marin/polygon did really well managing most of their models by looks of stocks levels

Canyon? who knows, they are hard to track due to how they can 'assemble to order' -I'd love to know how many Frames canyon sends out for warranty.
I've had 3 of their bikes and Each of them atleast had 1 full frame swap, My torque AL had 4.
AND they will get smashed from their battery drama. thats expensive but does anyone know if business insurance covers a design flaw?

3
12/23/2024 11:46pm
Several MTB brands have had this issue, they had to lock orders in and they still got made regardless.Pivot, Specialized, trek(Ebikes not selling either), bold, commencal...

Several MTB brands have had this issue, they had to lock orders in and they still got made regardless.

Pivot, Specialized, trek(Ebikes not selling either), bold, commencal and rocky(apparently)  all got smashed, Giant Have a sh1t ton of Ebikes to sell before Giant & yamaha can launch their new ebike.

Giant, YT, Marin/polygon did really well managing most of their models by looks of stocks levels

Canyon? who knows, they are hard to track due to how they can 'assemble to order' -I'd love to know how many Frames canyon sends out for warranty.
I've had 3 of their bikes and Each of them atleast had 1 full frame swap, My torque AL had 4.
AND they will get smashed from their battery drama. thats expensive but does anyone know if business insurance covers a design flaw?

Marin use a much smaller factory in Asia, it's lower production capacity and shorter production run's actually give Marin an edge as more flexible in changing the orders. The down side is this also causes Marin's occasional "We've run out.... SORRY!" and more limited availability of hot stock lines for the international distributors.

4
boozed
Posts
343
Joined
6/11/2019
Location
AU
12/24/2024 3:17am
Several MTB brands have had this issue, they had to lock orders in and they still got made regardless.Pivot, Specialized, trek(Ebikes not selling either), bold, commencal...

Several MTB brands have had this issue, they had to lock orders in and they still got made regardless.

Pivot, Specialized, trek(Ebikes not selling either), bold, commencal and rocky(apparently)  all got smashed, Giant Have a sh1t ton of Ebikes to sell before Giant & yamaha can launch their new ebike.

Giant, YT, Marin/polygon did really well managing most of their models by looks of stocks levels

Canyon? who knows, they are hard to track due to how they can 'assemble to order' -I'd love to know how many Frames canyon sends out for warranty.
I've had 3 of their bikes and Each of them atleast had 1 full frame swap, My torque AL had 4.
AND they will get smashed from their battery drama. thats expensive but does anyone know if business insurance covers a design flaw?

Dave Waugh wrote:
Marin use a much smaller factory in Asia, it's lower production capacity and shorter production run's actually give Marin an edge as more flexible in changing...

Marin use a much smaller factory in Asia, it's lower production capacity and shorter production run's actually give Marin an edge as more flexible in changing the orders. The down side is this also causes Marin's occasional "We've run out.... SORRY!" and more limited availability of hot stock lines for the international distributors.

Given that Polygon owns Marin, surely they'd use Polygon's factory/ies?

1

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