Cycle good, cycle smart

They wanted to do something unique in business, either a social project, improving under-privileged people’s lives or a smart solution that could ease middle-class people’s lives.  So, they went for a bike By Alicja Ciszewska As of 2013, Poland had an 8 percent share in the European production output of bicycles. Currently, the domestic market’s value is estimated at some PLN 1.2 billion. It comprises nearly 20 producers, however, it’s dominated by two: Kross and Arcus&Romet. While Kross  puts a lot of effort into developing its own technology and following global trends, Arcus is considered a good “assembly plant”. Both companies record annual turnover of some PLN 200-300 million, taking advantage of the nationwide fashion for cycling and the current shopping spree for mid-priced models, in which they specialize. Data from the Central Statistical Office (GUS) shows that in 2014, Poland manufactured up to 990,000 bicycles, which was an increase of 16.6 percent on a yearly basis. The majority of the output sold abroad is exported to Germany, and Taiwan is Poland’s biggest parts provider. Producers admit that Polish customers are getting more and more picky and aware of their needs. On the other hand, Poles are still not into biking as much as western European societies – there are only some 300 bikes per 1,000 Poles, whereas the EU average is 600. Igor Pielas and Marcin Piątkowski are young entrepreneurs who put their faith in bicycle manufacturing, reaching for two completely different business ideas. From Africa with love [caption id="attachment_91754" align="alignleft" width="300"] Image: Asante Bamboo Bikes[/caption] Warsaw-based Asante Bamboo Bikes (asantebikes.pl) is a quite unique startup as its mission is to empower education and community development in Ghana through manufacturing and selling bicycles made of light and long-lasting bamboo. Its business model is based on social entrepreneurship, which is about “applying practical, innovative and sustainable approaches to benefit society in general, with an emphasis on those who are marginalized and poor,” (Schwab Foundation for Social Entrepreneurship). Pielas, the founder of Asante has been interested in Africa and social entrepreneurship for a while. One day, he came across the Yonso Project, coordinated by  Kwabena Danso. The organization operates in 15 communities where it runs several programs such as scholarships, literacy improvement and youth leadership development in rural Ghana, through manufacturing bamboo-made bicycle frames. Hence, the idea was not invented by Pielas himself, he adopted both the business and the social entrepreneurship models. However, he did not want to copy Danso, who consequently became his business partner, he wanted to take part in a social venture that he found promising and effective. “Our mission is to create bikes that change the world. We want to construct a product that gives people joy and does something good somewhere else,” Pielas  said, stressing that his project has nothing to do with charity. Long ride ahead Bamboo-made frames are imported from Ghana, but Pielas has to deal with assembly himself (in his apartment) ,or contract it out to a workshop. Metal and rubber components are either acquired in the country or abroad, depending on the price. Currently, Poland is Asante’s main market, but its founder has an ambitious plan to introduce his products elsewhere, starting with Germany. Furthermore, he wants to expand the merchandise into apparel and other areas. The project is very time-consuming (Pielas is also working for Google Polska), so there was no time to conduct an active investor hunt, but the company certainly needs one. Rafał Brzoska, CEO at InPost, who was given an Asante bike by his friend as a birthday gift, could be one potential colaborator, but Asante’s owner asserted he has not approached him yet. In style Marcin Piątkowski’s product, a folding electric bike has already been hailed as “the iPhone of bicycles” or “a [caption id="attachment_91755" align="alignright" width="300"] Image: Asante Bamboo Bikes[/caption] beacon on two wheels”. An expert from Bentley Motors designed the bike’s frame and the ergonomic shape, the venture attracted managers at such international corporations as Tesla Motors, Pepsico, Bupa, Melex, Fiat and Jaguar Land Rover. Just recently, Piątkowski was included in Forbes’ “30 Under 30 Europe” list (among six other Poles), featuring 30 young innovators, entrepreneurs and leaders from across Europe. Jam Vehicles (jivrbike.com), Piątkowski’s company, was founded in April 2012. The year before, he brought the idea of an electric bike into life as part of his master’s degree project at University College London through “researching the perfect urban commuting vehicle”. The school supported the venture initially, but the young entrepreneur launched a kickstarter campaign and managed to raise over £126,000, which roughly translates to PLN 730,000. Not for cyclists “JIVR has all the equipment hidden inside. There is a mechanical drive, instead of a chain. Nobody will get dirty from grease and there will be no need to spend a lot of time on maintenance,” Piątkowski said of his product, adding that it’s easy to fold and store. The process of concept design, prototyping and design optimization lasted two years, a serial manufacturing plant was established last year in Mielec (Podkarpackie voivodship), the hometown of the founder. The staff consists of nearly 20 people. Frame manufacturing is carried out in-house, the rest of the components come from the firm’s suppliers (Sikorsky Aircraft and a Chinese company, among others). What’s interesting, the bike also features iBeacon technology, powered by kontakt.io, thanks to which  the vehicle interacts with any smart device. “Our customers are not cyclists,” Piątkowski confessed. He also admitted that demand for his product is higher than production capacity planned for 2016, i.e. 2,000 units, each priced at £2,000. [negative]I believe in this model with all my heart and I want to run my business on the basis of a do well, and do good idea[/negative] JIVR has designed a functional vehicle for people commuting in busy cities, that is precisely why it is testing its distribution model in a few “significant” European cities and is going to conquer such markets as London, Shanghai, the east coast of the US and Singapore next year. “We bet on making life easier in big cities,” Piątkowski admitted. The first concept store will be opened in Europe, currently, the company is working on a few locations, but the store’s design itself is ready. When asked about his strategy towards Poland, he revealed the company has only served “the customers who bought the bike on pre-order,” and is not going to expand marketing activities. Mutual appreciation [caption id="attachment_91756" align="alignleft" width="300"] Image: Asante Bamboo Bikes[/caption] Piątkowski is likely to wait until Polish cycling culture catches up with western trends, meanwhile Pielas could benefit from customers’ growing discernment. Apparently, both entrepreneurs are impressed by each other and are keeping their fingers crossed for each other’s projects. “I’ve heard about the bamboo bike, it’s an amazing thing, especially for connoisseurs of quality and uniqueness,” Piątkowski said. “It’s a XXI-century bike, technically advanced, practical and beautifully made,” Pielas commented on the JIVR. u Education is the weapon Asante launched pre-sales in September 2015 and managed to sell ten bikes (PLN 3,999 each) in just one week. The correlation is simple: one bike equals one scholarship. Pielas does not specify what percentage of the bike’s value funds a scholarship, because the price is to be decreased in March, when the official sales begin. Nevertheless, each grant stands at some $60 -70. "Education is the most powerful weapon which you can use to change the world,” Pielas cited Nelson Mandela, admitting that the quote is sort of his business’ motto. He believes that poor societies, with a lack of, or no access to knowledge, have fewer chances to develop, so what they need is information. From that standpoint, Pielas figured out that he would build interactive libraries in Ghana (going beyond the Asante region). In order to do that, he launched a crowdfunding action. The young entrepreneur has managed to garner enough money to start five libraries and purchase off-line tablets for four of them. Still, he needed funds for the fifth one, therefore, he came up with an idea of producing and selling bamboo-made wrist-watches and earmarked 10 percent of their value to the library project (100 watches = 1 library). Each opening was widely covered by him and his co-workers on the internet. Every person who bought a watch could (also can, it’s ongoing) see what they had contributed to. Pielas has high hopes for his venture and does not hide some of his worries related to the market’s feedback, "I am not sure if the social aspect will convince people in Poland to buy my products, but I believe in this model with all my heart and I want to run my business on the basis of a do well, and do good idea.”