Dutch bicycle company VanMoof has just raised a further US$40 million (A$54.4 million) to bring its total capital raising so far to US$73 (A$100 million).
In a world full of hundreds of bike brands, how has this relatively small and new player been able to raise, what is by bicycle industry standards, such a vast amount of money?
Here are three things VanMoof is doing differently to most other brands.
Firstly it has adopted a direct to consumer online only sales model.
Secondly, rather than build a frame, then attach Shimano or other components, VanMoof is striving to make as many components as possible in-house, so that they capture a greater portion of the sales value of each bike and so that the bikes are different to all competitors.
Thirdly they’re heavily into marketing and happy to be controversial, as we previously wrote about here.
Then there’s the deal sealer that venture capitalists love to see… growth. VanMoof says that they’ve grown sales revenue by 220% during Covid, selling more selling more bikes in the first four months of 2020 than the previous two years combined.
There are more Tesla parallels in terms of VanMoof’s unconventional designs and heavy reliance upon technology.
A significant portion will go towards building a suite of rider service solutions, making “best-in-class” support one of VanMoof’s key pillars. “Our next frontier is to transform our business by building a full support ecosystem around every rider,” said co-founder Ties Carlier. “Over the next six to twelve months, we’ll have upgraded every step of the customer journey, from production to scheduling check-ups. Getting a VanMoof e-bike serviced will be as easy as ordering a meal online,”
This ecosystem includes a global mobile service network, more intuitive app support, smarter software with remote diagnostic solutions, and more proactive customer support.
In explaining his reason for investment one of the latest investors, Colin Hanna, principal at Balderton, said, “As the COVID-19 crisis hit supply chains worldwide, VanMoof’s unique control over design and production was a key advantage that allowed the company to react nimbly and effectively. Moreover, VanMoof’s direct to consumer approach allows the company to build a close relationship to their riders, one that will be strengthened by new products and services in the years to come.”
VanMoof had a small presence in Australia during its early years, but to the best of our knowledge, they’re no longer available here. Now that it has pivoted to ebikes its direct to consumer model is problematic because it’s not legal to transport ebike batteries by airfreight.
Most of this article was first published in BikeBiz (UK)