Cowboy, the Brussels-based firm that has been designing and promoting electrical bikes you could see in main cities throughout Europe, has closed a small, strategic funding spherical of €5 million (round $5.5 million at present trade charges). That features €1 million in debt services.
Whereas the quantity isn’t as spectacular as a few of Cowboy’s earlier fundraises, the corporate has been on the lookout for an investor exterior of the normal European VC corporations which have already invested within the startup — an investor that might doubtlessly open new doorways. In consequence, Cypress Capital is main the spherical. The Hong Kong-based funding agency has sturdy ties with Taiwan, which is a key hub for the worldwide bicycle trade.
“Plenty of our Asian-based suppliers are Taiwanese for historic causes. We’re rising the portion of our European suppliers constantly as we’ve got about half of our elements that come from European suppliers. However the different half comes from Asia and principally from Taiwanese suppliers,” Cowboy co-founder and CEO Adrien Roose (pictured above proper) instructed TechCrunch.
Present traders Index Ventures, {Hardware} Membership, Future Optimistic Capital, Isomer and Exor are additionally taking part as soon as once more in Wednesday’s funding spherical. Cowboy can even launch an fairness crowdfunding marketing campaign to offer a chance to its clients to put money into the corporate.
“We’ve been elevating someplace between €10 [million] and €20 million a 12 months over the previous few years,” Roose stated. “And yeah, the quantity has gone down. Final 12 months we raised €8 million in fairness and €5 million of debt. And now we’re simply asserting a €5 million elevate, which is a reasonably small elevate for a corporation of our dimension.”
In keeping with him, the corporate wants to lift much less capital as a result of it requires much less capital. Cowboy ought to be kind of breakeven on an EBITDA foundation for the second half of this 12 months. Subsequent 12 months, he says, the corporate will flip a revenue for the primary time since its inception.
“And we don’t need to elevate greater than what we’d like, particularly in these market situations,” Roose added. It doesn’t imply that Cowboy gained’t elevate ever once more. Nonetheless, it’s been a wild trip for the startup because the e-bike trade skilled a big increase in gross sales after COVID-related lockdowns. The corporate’s valuation peaked round that point.
However then, demand slowed down fairly drastically. VanMoof, one other European e-bike startup backed by enterprise capitalists, declared chapter. It had a chilling impact on the whole trade.
With this latest funding spherical, Cowboy is now valued at €40 million on a pre-money foundation. However now, all eyes are on profitability — not the corporate’s valuation. “We’re beginning to see a ray of sunshine after the rain,” Roose stated.
And imagine it or not, rain performs an vital half in Cowboy’s gross sales. The corporate normally sells extra bikes throughout the spring as individuals begin fascinated by biking to work and different locations. It’s been notably wet in Europe this 12 months, so Cowboy’s gross sales have been a bit underwhelming.
Further Cowboy type components
The corporate initially centered on a single mannequin and iterated on the design over time. After Cowboy 1 got here Cowboy 2, Cowboy 3 and Cowboy 4. The corporate is now shifting away from numbers and increasing its lineup to different type components.
Cowboy added the Cruiser, a mannequin with an upright using posture and a step-through model to enchantment to extra riders. This 12 months, the corporate added the Cowboy Cross mannequin, an all-road mannequin that goals for consolation and long-distance journeys.
Equally, Cowboy has diversified its distribution channels. Along with its on-line shops, Cowboy now sells its e-bikes in conventional bicycle shops. “Since final 12 months, we began doing partnerships with native bike retailers as a result of the actual fact is that 80% of e-bikes offered in Europe are nonetheless offered by these bike retailers, and so we need to embrace that,” Roose stated.
Behind the scenes, Cowboy bikes share the identical digital platform and software program options, comparable to theft alerts, crash detection, in-app challenges and AdaptivePower. This characteristic, which has been not too long ago up to date, mechanically adjusts the ability of the motor relying on the present slope or wind situations.
“We’ve invested plenty of time, efforts and capital into constructing that platform that works rather well. And now we need to capitalize on it and basically construct a household of merchandise,” Roose stated. “So we’ve got the Basic, the Cruiser, the Cross. And you will notice extra bikes from us sooner or later.”
