Santa Cruz Bicycles sold yesterday. They sold to a a Dutch company called Pon Holdings, which also owns Cervelo, Focus, and several other lesser known cycling brands.
As many media outlets have alluded, co-founders Rob Roskopp and Rich Novak probably made out like bandits, but there’s more to the story then just that.
So why sell? Why now? Why to these people? To learn a little bit more about the how and why, I reached out to Joe Graney, the Chief Operating Officer of Santa Cruz Bikes.
Typically brands sell because they’re in economic trouble. They’re bankrupt or near bankrupt and a shakeup is required to try and salvage the operation. It’s these types of sales that have made many people cynical about acquisition deals.
Santa Cruz Bikes is not on unsteady financial ground. They’ve created a series of popular models in recent years, and if a quick look around my local trail head is any indication, business is booming. This success has lead a number of outside investors to come a-knocking.
Despite several lucrative offers, the co-owners had always resisted selling any part of the brand. Their major concern was that these groups didn’t have the long term interest of the brand or its employees at heart.
So why now? It certainly wasn’t about money. This brand and its employees are important to Roskopp. He’s been an integral part of Santa Cruz from its inception and has done it all. In the early days, he assembled frames during the day, then would come in during the evenings to powder coat. For him and his team, the decision to join Pon offered strategic benefits that would allow Santa Cruz to expand – without assuming more risk to the brand and its employees.
With its existing network of brands, working within the Pon Holding group will allow SCB to improve internal logistics as well as expand further internationally. As a side benefit, Santa Cruz employees will be able to interact and learn from other impressive brands within the same family.
Pon Holdings is not in the business of reorganizing firms for short term profits. Day to day business operations at Santa Cruz will continue as usual. Rob Roskopp, Joe Graney, and the entire product development, marketing, sales, tech support, and assembly team will remain intact.
What makes Santa Cruz Bikes special is the employees. Everyone from the guy packing frames into cardboard boxes to the CEO is passionate about riding bikes. Their process isn’t driven by numbers, it’s about passion.
So while the name on the paychecks may change, the people behind the products havn’t….and btw, they now offer a lifetime warranty on all of their frames.
