Inside the INCubator with Moccasin Bend Bicycle Company
Apr. 8, 2016
Moccasin Bend Bicycle Company is a business-to-business provider of lightweight carbon fiber and Chattanooga-built steel bike frames. All frames are custom painted and decaled in Chattanooga, Tennessee.
Year Founded: May 2013
Founder: Lawrence “Tiger” Martin
Q: Tell me about your business.
A: We make and sell custom bike frames to other businesses that sell bikes direct to consumers. We’re selling to shops in Maine, Massachusetts, and North Carolina and those within a two-hour radius around Chattanooga. My clients typically start their orders at 10 or 12 frames, then the reorders come in maybe four at a time, so it’s small batch.
I started as a business-to-consumer (B2C), web-based platform selling custom-built bikes in 2013. But I learned pretty quickly that that wasn’t going to work for a one-man-show like mine. There was just too much time involved in retail sales, so I pivoted when I had the opportunity to begin building frames for other businesses. Today, Moccasin Bend Bicycle Company is 95% a business-to-business (B2B) company.
Q: Talk a little more about your process to find your customer.
A: We tried lots of things initially, and some didn’t work. For example, I originally invested in a lot of components for bicycles, like wheels that I had custom made. I thought we were going to sell tons of this kind of product, but we didn’t. And all these nifty disk brakes and high-tech 1x11 shifting systems – there’s no money in it. The component producers sell their products through so many different channels that it’s hyper competitive that I just couldn’t compete. So we had to liquidate, and we took a little bit of a hit, but we got most of our money back and were able to fight again. I guess it happens a lot with startups. We went all in and almost bankrupted the company in the first year. But we figured out how to change course quickly and make another run at the market.
You know, I told my wife when we started the company that I was 94% sure it was going to work, but I was 100% sure the business wasn’t going to look anything like the original business plan. It changes because it has to. That’s the nature of business. If you’re not willing to change, then you’ll just sit still until the business fails, because the market didn’t obey your opinion of how it should work. The first year we lost a fair amount of money getting geared up. We halved that loss in the second year and we broke even this year. I feel we’re on the right path and are poised for big growth in 2016 and beyond.
Q: What’s your production process?
A: Our primary products are steel and carbon frames. For the steel, I order the raw materials and contract with a local frame builder to construct the frames from the ground up. I’m actually in the process now of becoming more vertically integrated by learning to weld and paint so I can complete them myself. For the carbon frames, there are no financially viable scenarios using US-built products yet, so I import them from mainland China in a raw state and we finish, paint, and outfit them right here in Chattanooga.
Q: Do your B2B customers carry the Moccasin Bend Bicycle Company name?
A: They can, but I mostly supply companies that choose to have their own name on the frames, which I can custom decal in-house. For example, one of my largest customers is a bike company in North Carolina.. They’re based out in coal country and I build frames for their very popular “gravel grinder” model. From time to time I do a few customized full-builds for individuals with the Moccasin Bend Bicycle Company name. Building full bikes isn’t any more profitable than selling the frames alone, but they take up a lot more time and capital, so I prefer to sell just frames. That’s why my money is on B2B sales of frames.
Q: How competitive is the B2B frame building market?
A: There’s not many people doing it, so that’s why we’re there. In fact, what I thought was a really strong competitor in Portland, Oregon just closed their doors recently because they had way too much invested in people and machinery and it forced them to require huge minimum orders of unpainted frames requiring long lead times. To put the situation in perspective, we’re producing frames here in Chattanooga which aredesigned, painted, decaled, and fully prepared for retail assembly for considerably less money than the Portland folks. And we’re doing all of this while requiring minimum initial orders one tenth the size of the big guys, so that’s my niche and my advantage. I can run lean, I can run fast, and I can change direction quickly. I can sneak around my competition, filling the sizable gaps they’ve left in the market. It’s a “guerrilla warfare” tactic, if you will.
Q: What are your goals for the company over the next five years?
A: Our marketing effort needs improvement, and we primarily need to continue to grow sales and increase our profit per unit. My goal is to scale from mostly local and regional sales to reaching more of the east coast, west coast, and then international markets – primarily in Europe. The European market intrigues me, because they love American-built mountain bikes and they have a much stronger bike culture than what we have here in the United States. I’d also like to be able to hire a core team for marketing, sales, and production. We‘ll be a market leader once that’s in place.. I’m just trying to get to that tipping point, but I we’re getting there.
Q: What got you into cycling?
A: A desire not to run laps before soccer practice. Which is funny because I just ran the Chattanooga Marathon, so now I run too. But really, I was sort of fascinated with bikes my whole upbringing. I grew up in a small, college town in Virginia and at the end of every term, all the bikes that wereabandoned around the campus would be picked up by campus police and taken to the landfill (this was in the era before widespread recycling). Something like 40 bicycles every year buried in a landfill. Can you imagine it?!? So, before the bikes were carted off, I would cherry-pick all the best parts and build a new bike for myself. Eventually, I grew pretty capable at building bikes out of almost any parts. I’ve been doing this for 40 years now and I still love it. Along the way I’ve even worked for Trek, American Bicycle Group and a lot of the big retail shops and chains around the country.
Q: What’s your assessment of the mountain bike community here?
A: We have a phenomenal system of trails here that’s better than a lot of places have. But we’re not done - we’re still building. There were nine miles of single track recently added to Raccoon Mountain a year or two ago that was built almost exclusively by mountain bikers. It’s amazing. There’s also an extension going in at Enterprise South Nature Park and they’ve built some fantastic trails out at Southern Adventist University – a great system called the White Oak Mountain Trails
There was a Chattanooga Area Singletrack Master Plan started fifteen years ago with a “100 in 10 by 10” vision: 100 miles of trail built within a 10 mile radius of Chattanooga within 10 years. They just barely missed it with 87 miles completed in 10 years, but at this point the mileage goal has been exceeded and continues to grow. When I got here in 2002, people were saying, “Oh, we think Chattanooga could be the Boulder of the East,” but now I really think in some ways that Boulder should hope to be the Chattanooga of the West.
Q: What’s your favorite trail?
A: My favorite trail is Raccoon Mountain but I don’t get up there as much as I would like, even though it’s very accessible from town. I ride Stringers Ridge most often because I can ride to it from my house in North Chattanooga and I don’t have to have the car. It’s a nice trail system. We used to spend weekends clearing those trails before it was an officially-recognized system. If it weren’t for a few bikers keeping it clear and then The Trust for Public Land and Jim Johnson falling in love with it and advocating for its preservation, I think those trails would have disappeared and someone would have developed housing up there. It would have been a travesty. Not many cities have a wooded, 92-acre park right in the middle of their downtown.
Q: How has Chattanooga nurtured you as a startup?
A: Chattanoogans do things on a pretty grand scale, and the renaissance of the city really makes people feel like anything is possible; like anything can be done. Towards the end of working for my last employer, I was considering starting this business and I thought to myself, “If not now, when? If not here, where? What am I waiting for?” I’ve never been in a place where I felt like opportunities were more achieveable. I mean, people can have an idea and just charge ahead and other people will help them. In this regard, the TSBDC and the Incubator have been marvelous. Moccasin Bend Bicycle Company wouldn’t be at this exciting stage in its development without them. This is a very nurturing community, business-wise, and I think socially as well. It’s been great. My family and I will not be leaving Chattanooga. I joke that they’ll only get me to move out of my house when I go out “toes up”. This is a great town which continues to draw energetic, intelligent, creative people. The success of the place is contagious and therefore builds upon itself.
Q: Any advice for other startups?
A: When you write your business plan, build in as much financial cushion as possible. Get as much cash together on the way in as you can. I also think it’s a good idea to have at least two people involved, preferably with two completely different dispositions. You really have to have that entrepreneurial idea-driven person. You know, someone who’s all over the place, always thinking up a ton of great ideas. But then you need the other person who says “whoa, that’s a great idea, but how are we going to make it happen?” You need both. For the most part I’ve only had my “internal monologue” for three years and sometimes it’s like being crazy because you’re just talking to yourself, and of course you think all your own ideas are brilliant. It can create blind spots and cause you to stumble into some bad decisions.
The other thing is don’t be afraid to fail, but don’t be afraid to succeed either. I received some great advice once to not be afraid to “fail big”. “Paralysis by analysis” is also a real pitfall for young startups. To do nothing in the face of risking failure is to fail, so you might as well chart a course forward and see where it gets you.
Q: How do people contact you?
A: The best way to reach me is to just call me at 423.605.8847. That’s my cell phone and it’s always with me.