The theft of two bikes from one of the inventors pushed the former engineering students from Chile to tackle the exasperating crime. Their solution? To create a frame that is dismantled and reconnected to make a lock -- all in just 10 seconds, according to its creators.
Fitted on a stylish steel frame, the bike's aluminum downtube splits in two to allow the seat tube to form a steadfast lock around any tree, pole or bike rack. The only way to take it would be to saw through it -- making the bike useless.
And last week was an important one for the three young men as they put in their first order to produce 300 of the bikes.
After designing a successful prototype, Cristóbal Cabello, 22, Andrés Roi Eggers, 23 and Juan José Monsalve, 24 left their university course to throw themselves full time into the project. An investment of $100,000 from a state enterprise fund fueled the product's research and development, but they turned to crowdfunding website Indiegogo
to sell their first batch of the bikes -- known as Yerkas
"We chose crowdfunding because it's the easiest way to make the product go worldwide," explains Cabello, the start-up's CEO. "It's an international web page that is well known, and customers can pay securely with a credit card. It was the safest way to handle the money."
The young entrepreneurs sold 197 bikes in the campaign
, roughly half of which were ordered by customers in the United States. A third went to Europe, with a small handful snapped up by Australia, Hong Kong and New Zealand. Only 15% of the bikes were sold in Chile.
"I think it's the culture," says Cabello. "In Chile we haven't got the culture of riding a bike as a commuter and the infrastructure and bike lanes aren't good. But that is changing."
Cabello adds that European and North American customers are prepared to spend more on a good bike, because the culture of cycling has been around for longer. The start-up sold the first 100 bikes for $400 then increased the price increased to $500. In future it will rise to $600 or more, depending on where you're buying from.
The bottom line
Nevertheless, the cost of global deliveries has left the Yerka founders looking at zero profits from this first order. Cabello says that 50% of the bike's sale price went on production, the other 50% on distribution, administration and legal costs for patents.
"We knew this at the beginning," laughs Cabello. "What's important is that people get to know the Yerkas worldwide. Hopefully someone in Australia will say to their friends, 'Look at this bike I bought', which in the future will increase sales and hopefully profits."
While the crowdfunding campaign was a great way to test the global market, getting the bikes to far-flung destinations hasn't been easy. "It's very difficult for a start-up to handle all the deliveries because of the logistics and fees in every country," says Cabello.
The bike's mechanical components are made in Taiwan; the steel frame and fork in mainland China. Manufacturing has been entrusted to a specialist factory in Shanghai, where the founders are confident they will get a high quality product.
Even that wasn't easy. "Ours wasn't a huge order and the factory produces 3,000 bikes per day," says Cabello. "So it was difficult to find manufacturers who would do it and believe in us that in the future we'll make bigger orders."
Taking it slow
The bike may ride fast, but for Yerka's business plan, slow and steady will win the race. The team ordered an extra 100 bikes which they plan to sell in Chile, before targeting the U.S. market in 2016. They will wait for customer feedback before increasing production and hitting up global markets.
To do that, they are seeking $1 million investment from national and international financers.
"In the next four years, our goal is to sell a container of almost 300 units each month worldwide. But the most important goal is that customers say, 'This bike is great. We love the bike you sold us and we will spread the word.'"