Mad, Bad, & Dangerous To Know
– There’s already big bike industry intrigue in 2012. An internationally-renowned brand spirals towards bankruptcy, only to be saved at the final moment by an outsider who scoops up the pieces for a bargain price. I’m talking, of course, about German company Fixie, Inc.
Fixie’s art school chic never grew old. Travelling to the Eurobike trade show has been like an annual pilgrimage to be tempted by its gritty urban bikes. And the annual escalation in its marketing absurdity was the antidote to bike biz blandness. Evidence exists, too, that Fixie had a love affair with bygone traditions of road frame production, which could be why they remained committed to titanium and steel in an otherwise fully carbonated marketplace.
Thanks to the new owners, the demise of Fixie, Inc has been prevented. But, sadly, a larger statement was made about the viability of urban hipster brands. They’re not. The scene is dead. As with all artistic endeavors, critical acclaim is never enough. It’s gotta sell.
As you might recall, in earlier days Rapha was vocal that its clothing was inspired by the rough-and-tumble London courier scene. It took a few seasons for it to shift its focus onto Euro road romance. And Swobo bottled the San Francisco bike messenger ethos. ‘Mad, bad and dangerous to know’ crackled in its fashion, its branding, and its blogging. Swobo is now in its third set of owners. Timbuk2 came closest to hitting the big-time literally on the back of the metropolitan messenger scene. Yet it also admitted that it teetered on the financial edge for too long. It now pays its bills with Kindle cases and diaper bags.
– This year also brought the apparent near-demise of another fabulous brand, Cervélo. Given the taut language and yuletide timing of its announcement of a financing agreement with PON, it’s easy to imagine the tightening of the company’s financial noose.
It’s not difficult to do a post-mortem on the rise and decline of Cervélo. Two engineers start a company, they get fully consumed by innovating and growing it like mad. Then they commit to an all-in marketing effort by establishing a world-class bike race team, the Cervélo Test Team. Managing and funding the team becomes an additional all-consuming thing within a scrappy start-up environment where conceivably one all-consuming thing, the business itself, was already too much.
Cervélo shut down all online sales channels about 18 months ago. Nevertheless, we stayed friendly with nearly everyone there. It was a telling sign that nearly every Cervélo veteran left the company during that period, including one of the founders. In another telling phenomenon, the pace of product innovation noticeably slowed. The launch of the S5 in 2011 was its first well-executed product release in nearly three years. (Let me preempt here anyone who might suggest that the 2009 unveiling of the P4 was anything but a trainwreck.)
The rise and fall, however, may be followed by redemption. History suggests that the likely acquisition of Cervélo by PON will be the best thing that could happen to the brand. Specialized went through a similar period of financial terror back in 2001 when it reportedly sold a 19 percent stake to Merida, a Taiwanese bike manufacturer. And Cannondale went through emergency financing then bankruptcy back in 2003 before being turned around by Pegasus, then sold to Dorel four years ago. In the time since, growth in financial value, prestige, and mindshare of those two brands has been enormous.
Cervélo is first and foremost an engineering company. In most entrepreneurial endeavors, the worst possible situation is one in which the founder has to obsess over finance instead of creative vision. Assuming that Phil White stays on to re-energize Cervélo and resumes the role of engineer-in-chief, it will once again be a force to be reckoned with by 2014 or so.
The most underrated reality in business is how hard it is to build a great brand. All the financial backing in the world can’t buy a company the sort of lustworthiness Cervélo had in its golden era from 2006 to 2009. With solid financial backing the company can leverage that brand power to reach all-new heights. PON scored big, and the management of Cervélo should now be set free to actualize Phil White’s vision.
– Cervélo has a sizeable legacy for innovation. And one aspect of it was free of charge: Their commitment to branded content through their Beyond The Peloton video series. For better or worse, branded content is the most compelling video we get in the bike industry. Here’s one I saw from Clif Bar this week that I liked a lot:
– In the competition of Blog Post Of The Year for 2012, Fyxomatosis’ Paris-Roubaix adventure is our first nominee. It’s called ‘The 17 Sectors/Years Taken Off My Life’ and there is much to love about it.
– Registration is open for the best event of the season. In a world where an Ironman costs $1,000 and a training crit costs $20, at 25€ this is the mother of all bargains.
– Has anyone bought this iPad app? Is it worth the $10? I see that there’s a book version on Amazon. The Bromptons, I’ll admit, make me wince.
– There are countless definitions of what it means to be well-read. For this crowd, Joe Lindsey’s Boulder Report goes on the list. He’s a sage in nearly every way. The exception is his avowed dislike of the word PRO. The more I ride, the keener my sense is of what PRO is. It’s often manifested in the European professional peloton, but let’s be clear that it’s a state of grace shared by any of us who make bad life decisions in order to go train. PRO is multitudes: It can be a form of consciousness; it can be an object; it can be a landscape. Amateurs can access PROness no less than a PRO can. It’s just that they ride more, so they get more opportunity.
So, Joe, I dedicate a gallery of PROness just for you: