w/ Brian De Groodt, Dispatch Custom Cycling Components
Listen in as Kurt Elster catches up with Brian De Groodt about his inspiring journey creating an innovative line of personalized custom cycling components for cyclists all around the world. Hear the story of how Dispatch was born after an investment in a bicycle frame manufacturer (Siren Bicycles) and get tips on key strategies that this solo founder uses.
The Unofficial Shopify Podcast
4/25/2023
Kurt Elster: When I was first building my agency business 15 years ago, I was an avid cyclist. I wish I still was. I am at heart. I’ll get back on that bike. I swear. But I worked weekends as a bike mechanic in a local bike shop and I loved it. I was a SRAM certified bike mechanic. Worked retail. And eventually that bike shop became our first ever Shopify project. Knowing nothing about Shopify we dove in, migrated from Shopify, designed and built a custom theme, and so I have an affinity for this industry. I’ve even been to Interbike in Vegas. It’s a ton of fun. Got to go several times. And I am thrilled to have someone from that cycling world on the show today, someone from the bike aftermarket, because there are so many parts, components, and accessories you can get into when you start cycling, biking, whatever you want to call it. It's like golf times ten.
And so, today on the show, on The Unofficial Shopify Podcast, your source for eCom recon-
Sound Board:
Kurt Elster: … we are bringing on Brian De Groodt, founder of Dispatch Custom Cycling Components. Brian traded in a 25-year career in enterprise software sales where he was generating $250 million in lifetime revenue, gave that up to work on his mission of getting people on their bikes more often. I’m your host, Kurt Elster.
Ezra Firestone Sound Board Clip: Tech Nasty!
Kurt Elster: This is The Unofficial Shopify Podcast. And Brian, welcome.
Brian De Groodt: Thanks, Kurt. I appreciate it and I appreciate the introduction, as well. Happy to be here.
Kurt Elster: So, all right, what does Dispatch sell?
Brian De Groodt: So, we sell a number of different products. They’re all primarily designed to allow customers that have bicycles to make their bicycle one of one versus one of potentially millions. We can get into the numbers of bicycles that are sold every year in the U.S. and kind of how that breaks down, but the odds are you have a bicycle that probably looks like somebody else’s in this world, and having the ability to customize it and make it your own, I believe and my customers share with you, creates a tighter bond to what is already arguably the… I think one of the most interesting connections of humans and machine in the world.
And they range in parts from headset caps that fit on the cockpit, to bar end plugs, frame protection which kind of wraps around the frame of the bicycle, because some of these things cost more than maybe even your second or third car at this point, and a number of other options that allow you to personalize your bicycle.
Kurt Elster: Yeah. There’s something about it, right? I have always been of the opinion that until I customize it, I don’t own it. That is just my personality. It’s what I like. And an easy excuse to do some shopping for accessories after a purchase, of course, right? You buy a bike, and this is gonna kick off a consumption cycle, like… Well, I need gloves. I need a helmet. Certainly, I need lights, front and rear. The list goes on and on. I need tools. Now I’m getting into it. I need a bike stand. I need levers. Oh, we need backup parts. Wait, I can upgrade this. I need a better chain. Oh, I can put better brake pads on it, get better stopping distance certainly. We gotta swap out the tires.
It just keeps going, right?
Brian De Groodt: It does. It does. Yeah.
Kurt Elster: I love Continental tires. Those are my favs.
Brian De Groodt: Yeah. Conties are great. I have used Race Kings for many, many years, and have nothing but great things to say about them, but I think to your point if you go to, and you probably know this well from having worked in the bike shop, the bicycle itself doesn’t come with a ton of margin. It probably comes with the most dollars in a transaction, but the actual margin, the turnover for the shop, is really coming from all the things you just mentioned, right? All the bits and pieces that can come along with the bicycle to either make it your own, or because they’re consumable and they have to be replaced at some point in time, and so I think that opportunity there for shops, especially, to look for higher margin items that you may not look at as necessarily very expensive, I always liken it to buying a car. When you buy the $40,000 car and they ask you, “Do you want to spend $150 on the floor mats?” You’re like, “Yeah, sure. Of course. It’s $150.” But if you were to do that in isolation, go, “Hey, do you want $150 floor mats for your new car?” You’re like, “Wait a minute. No way. I can get those for 40 bucks on Amazon.”
So, getting connected to that margin I think is really connected to the new buyer experience and having the opportunity to say, “Hey, this is a great day. This is a great new beginning of something for you with this bicycle, and here’s a couple of opportunities to make it your own.”
Kurt Elster: Yeah. The advantage to that is like in theory, I have a better experience with it. I’m adding utility to it. But I’m also making it mine. It goes from being an object in my garage, my apartment, whatever, to a thing that I am emotionally invested in, I have ownership of, and then ideally that gets me to ride it. But I remember just like endlessly… I had two bikes. Just endlessly tweaking them and thinking about different builds, and fiddling, and it was all about making it mine, but also making it more comfortable and designing it around like, “Well, this is how I use it, and this is how I want to ride.” And this is what’s comfortable.
Brian De Groodt: Yeah.
Kurt Elster: And that would vary from like, “All right, as much as I like this seat, this other seat’s just more practical and more comfortable,” to, “I want this because it looks badass.” Right? If it looks cool, maybe I feel cool, maybe I ride it more.
Brian De Groodt: Yeah. I mean, the bicycle does nothing without human input, right? And so, there’s already this very significant connection between the human and the machine. And I think just amplifying that further and saying, “Well, what would really make it yours? What would make this thing that effectively can’t do anything without you, how does that connection get tighter and what input can I either add to the bike or take away from the bike in some cases…” Reflectors out.
Kurt Elster: I would… Yeah. You rip those off and then I would use reflective tape. I thought reflective tape was cool.
Brian De Groodt: Exactly. There you go. Exactly. Exactly.
Kurt Elster: So, the number one thing you sell, you got a few items, but the leader category, for sure, headset caps. Stem caps. What the heck is a stem cap for people who are unfamiliar with this?
Brian De Groodt: This is a great question. I think it speaks to some of the evolution of the business. A headset cap after the bike has been built is you could argue one of two things. Either purely aesthetic or if lawyers were standing around we would say it’s a safety feature, right? Because what it does is it sits on top of your steerer tube that you basically control the wheel on your bicycle which direction it goes, the front wheel, and so there’s about an inch-and-a-half-wide hole that sits there, and should you have some sort of accident, or go over the bars, this is a hole that you definitely don’t want coming towards your body. So, this covers it up. Typically, from the factory, it’s going to say something. Maybe, if you’re lucky, it says the bicycle brand that you bought. It probably says nothing at all. Probably just kind of escapes most people’s attention and this is one of the difficulties of Dispatch, is just educating people on the opportunity to do something there.
But it just is a round piece that keeps everything pretty much in place and after the build is done it really is aesthetic and a good opportunity to do things like customize it.
Kurt Elster: What’s important is it sits in a place… It’s like dead center behind your handlebars.
Brian De Groodt: Exactly.
Kurt Elster: And so, when you’re on the bike it becomes this inescapable thing in your sight line that you see just behind your front wheel.
Brian De Groodt: Yeah. If you’re a rider like me, you’re probably spending a lot of time looking down at that stem. If you’re maybe a safer rider, you’re looking a few feet up the road hopefully every once in a while, but it is definitely, to your point, if it was an automobile it would be your dashboard, effectively.
Kurt Elster: And so, we’ve established what the heck a headset cap is. What have you done that you have built this huge business around what was previously this overlooked afterthought of a component?
Brian De Groodt: Yeah. So, the story goes back to about 2012, I think it is. I just by way of chance, I suppose, I made an investment in a bicycle frame manufacturer, ended up acquiring that company, and these were all custom made steel frames in the U.S. And the model, at the time, was basically sell one, build one. And if you’re selling $2,000 mountain bike frames in the U.S. that are custom made, you don’t have a ton of margin leftover at the end of the day and it’s not a great, scalable business. But what the business did have was a lot of other assets that were, in my opinion, marketable. And you had a lot of customers that had been buying from the brand for years and wanted something to be able to say basically I won a Porsche or a Ferrari kind of thing, right? Like I have the bottle cap, or I have something that shows more than just the bicycle that I own.
And so, we started making headset caps for that company purely as a marketing play, and they took off, and these, at that time, we were selling them for I think $15 shipped. And it wasn’t really a good idea for the business because it started to cannibalize the frame building business and we started to become known as the headset cap company instead of the bicycle frame company, and that is definitely not the move we wanted to make, so we separated that company out and basically worked with a local laser engraver for a little while just to see whether or not this had legs. It did, and so I brought in at the time with what I call my business roommate, brought in the laser engraver, and started going through the process of creating different artwork, different graphics, allowing for customers to actually customize and put their own sayings on the headset caps, and from there just it really took off. It’s been five and a half years now and I think we’re now certainly a prime position in the industry, if not the leading position.
And, you know, it doesn’t look like there’s any end in sight here so far.
Kurt Elster: So, in many ways, it’s a little bit of an accident but more recognizing an opportunity, right? You’re selling… You invested in a bike frame manufacturer. Do we know who this brand is or rather can we?
Brian De Groodt: Siren Bicycles.
Kurt Elster: Siren Bicycles.
Brian De Groodt: Yep. Very small U.S. based hardtail mountain bike frames built here in the U.S.
Kurt Elster: You’ve got $2,000 bike frames that are getting cannibalized because you’re selling a $15 part, and so you recognize that opportunity, but what was it about the headset, this inexpensive part, that seems inconsequential relative to the big price of the frame? Frame’s way harder to ship, for sure. And you said, “Well, we should take it and make its own company.” You said that like it was an obvious thing to do. I would not have jumped to that conclusion.
Brian De Groodt: So, I think one of the important parts that I may have left out here, in the U.S, on average, there are about 17 million new bicycles sold every year. Now, that comes across a variety of different spectrum of everything from Aeroad triathlete bikes to beach cruisers on Long Beach in California, right? But what that… I don’t care how you divide that number up, any one of those subsegments is much larger than Siren was ever selling, and so I saw an opportunity to say instead of just selling to people that are really into this bicycle brand that I own, let’s back up and say, “Hey, anybody, I don’t care who you are, what you ride, you can buy this headset cap.” Nothing wrong with any of the brands. I’ve come to see the light, ultimately, but when you’re building bicycle frames you of course look at every other brand as maybe inspiration, maybe a peer, or if it’s a really large macro brand then you’re like, “We definitely don’t like those guys.” Right?
And that’s just not right. It didn’t ultimately serve the mission that I was trying to get to, and I think having the opportunity to step back and just say, “Hey, you know what? Everybody that rides a bicycle is way better than 100 people a year that we sell a Siren bicycle frame to.” It’s an order of multiple magnitudes larger than what we had before. And I think there’s this kind of… In the industry, there is this very aspirational sale that happens, right? There’s this image of a cyclist that quite honestly is disconnected from the majority of the buyers that I speak with and have emails from, and I think if you walk to the downtown Chicago and you look at the local Trek store, you’re gonna see giant imagery of some 135-pound cyclist in super tight Lycra hammering up some ridiculous mountain that clearly isn’t in Chicago.
And you know, it’s like, “Okay, well, that’s what I’m buying. That’s what I go in and give my 5, 10, $15,000 to go be because I bought into this imagery or into this persona.” You take the bicycle home, you go out on a ride or two, and you realize that you’re actually not that person and there’s this promotion of that image that just doesn’t really do anything to say to the person that bought the bicycle, and I think this is one of the biggest problems that shops have, “Keep riding that bicycle.” Right? To ride your ride, that’s what we say here, right? We say this all the time. Ride your ride.
It doesn’t matter if it’s to work, it doesn’t matter if it is up Alpe d’Huez, it doesn’t matter if it’s just to go get groceries with the kids. It really doesn’t matter so long as you’re riding your ride and enjoying what you’re doing on the bicycle. And I think that that message is very broad, and perhaps that’s why the industry can’t really embrace it so much and say, “Hey, if you’re a 350-pound overweight individual looking to get healthier, this is a really good way to actually condition yourself back into a healthy body,” right? Versus here’s the 100… It’s like a gym showing the person that’s already been working out for 10 years and you’re like, “Well, I don’t look like that person. Do I fit here? Or should I just pay my membership and really never come back again.” Right?
We don’t want that. We want people on bicycles.
Kurt Elster: And so, why does getting more people on bikes matter to you?
Brian De Groodt: I think there are a lot of reasons. I would say for my own reasoning. I know I’m a better person when I’m on a bicycle than I am in a car. I know that I’m a better person when I ride my bicycle and come to the shop to handle customer interactions, or create new products, or run the orders for the day. I’m a better person mentally and physically for that. And I think N of 1, but I do believe that if I’m enjoying the effects of having exercised, and gone out on a ride, and been a better person than having driven my car somewhere, this has a multiplying effect, right? Ultimately more people on bicycles being happier with themselves, being happier with life, smelling things, seeing things, talking to their neighbors, talking to fellow riders, talking to people on the trail. This is what we need as a country, as a society, and I think as humankind, quite honestly, to have that interaction.
I would say one of the downsides of COVID, even though we did extremely well through that process or through that time, there kind of was this bifurcation of should you be out or should you not be out, and kind of this two worlds of opinion. It was like, “Well, I’m on a bicycle. We’re multiple feet apart from one another.” And some of that was lost during that period of time and I think that getting that regenerated and having those connections is especially critical right now.
Kurt Elster: I agree with you. It sounds like you have an unusual amount of interaction with your customers versus other founders we talk to where they tend to be a little bit removed. Are there any… You got any war stories? Any particularly memorable customer stories?
Brian De Groodt: I do. I get a lot of stories. I would say first off just by way of the fact that we… At least 40% of our business is truly custom, as in the customer said, “I want these words on this headset cap.” So, we don’t have 11 colors with 15 pieces of artwork that we can go put up on a shelf somewhere and go, “Okay, if somebody wants to buy it, go buy it.” Or put it into a 3PL and let it ship. We’re making every one of those orders to order.
And so, by way of that, I think we have a little more of just a tactical position to speak with our customers more often, but I also believe just by way of my Klaviyo flows and the interactions that I get back from my customers that we’re doing something very special. I have some brand affinities in life that I’m very, very loyal to. I can 100% guarantee you I have never, ever written back to any of those organizations with the kind of emails that I get from our customers that are… And I mean this in the best kind of way, they’re incredibly intimate and almost cathartic in many ways for I assume the author, but also the recipient, me, where I get to read them and hear stories of redemption, stories of loss, stories of I put myself in a bad spot in life for a very long time for whatever particular set of reasons and I’ve gotten back out on the bicycle and this is the only way that I’m able to cope with what I have in front of me.
I have one customer who’s a great customer who lost his father… Actually, two customers that come to mind right now that have both lost fathers in the last couple of years that have basically memorials on their bicycles for their loss. And depending on how you’re riding, I ride… I tend to ride longer, very endurance-focused type rides, these things can break you down mentally at times, right? These rides can really get you into beyond the pain cave into areas where you’re like, “Boy, I didn’t know I had this darkness inside me and I’m so glad that I have this opportunity to get it out on the bicycle,” to the point of tears kind of thing.
And I think that that’s, again, that’s that human and machine connection, but it’s also that human-to-self connection and really having that opportunity to be out there with nothing else in front of you, right? So, hopefully you’re not on your phone, hopefully you’re not on any social media, things of that nature. You’re just turning over the cranks and you’re working with yourself, and the machine, and I think that gives you an opportunity to reflect quite a bit. And those stories that come in from customers are many, many paragraphs long. I’ve had more than one occasion where I’ve read them and reread them and just been moved I guess is just the best way to put it. They’re extremely touching.
Kurt Elster: The best meditation I’ve ever experienced is doing 50 miles on a bike. And that, you’re right, it forces you to focus, but then you’re also combining it with exercise, you’re outside, it’s just a really… The whole thing is very beneficial, but you have to get out, get started, and then keep going, and then suddenly you’re like, “Oh my gosh. I just did 50 miles round trip on a bike.” It’s quite incredible. You mentioned COVID. Well, all right, how long has Dispatch Bikes been around?
Brian De Groodt: So, last August was five years, so that’s 2017, so I guess we’re now five-and-a-half years old as of March. Actually-
Kurt Elster: And how long has this thing been on Shopify?
Brian De Groodt: So, if we moved too slowly to get Siren onto Shopify, we moved a little too quickly to get Dispatch up and running on Shopify. I wish I had screenshotted all of the iterations that we had over the years. But from day one it’s always been on Shopify. I may have taken just a couple of few orders from just PayPal direct kind of thing, but otherwise it’s always been on Shopify.
Kurt Elster: All right, I want to talk about your Shopify store, but before we do that, let’s go back. How did COVID impact your business?
Brian De Groodt: Like everybody else, in March it was like, “Okay, we’re doomed.” And literally three weeks later you realized that… I certainly did, at least. It was like, “This can’t last much longer now, right?” This can’t last much longer now, right? And every two weeks you’re like, “Okay, when’s that ban getting lifted?” And it just never happened. And I think as that extended the initial hit was I would say about two weeks long. I think by mid-March we realized that this was gonna be a problem, and by April we were doing more products and more sales than we had done in any same period previous. March and April are weird for us because you have winter thaw that’s happening, so you come into that spring season, so where maybe the southern half of the United States is getting warmer and kind of carries our business through that wintertime. May through call it October-November tend to be really good across the entire country, right? And so, you have a much larger audience.
But we were seeing numbers that we hadn’t seen in previous same periods year over year, and so we knew that this was gonna be okay, and thankfully just by pure stroke of luck I had placed my orders for raw stock well in advance of COVID, and so these things take time to be made, and to get shipped, and everything else, and so we got very lucky to have plenty of backstock and availability through that entire period. And then it was just a matter of trying to figure out how to manage accelerated consumption with no real comps from previous periods to work against and try to figure out how do we stay ahead of the inventory.
And for the most part, we did. We lost it a couple of times where we just, as I said, I think more than one occasion through that period. I think I’ve lost control of the ship. So, we survived, and we did quite well through it.
Kurt Elster: These headset caps and the bar end caps, it’s really… It’s like a small part that you could… In theory, you could machine this yourself, and then it looks like it’s anodized, and then you laser engrave it?
Brian De Groodt: Yep. Exactly. Yeah.
Kurt Elster: Do you manufacture these in house?
Brian De Groodt: We don’t. So, we have a couple different manufacturers that work for us that produce here domestically and overseas, and the parts that are… When we receive them, they’re already anodized in the colors that we’ve selected, and then they’re essentially ready to go into one of any of the different pieces of artwork or customer art that goes onto them through the laser engraver. We’ll put them on a big, giant jig that basically sets up the artboard from Adobe Illustrator, and that’s the day’s work, and it just kind of sits there and sweets back and forth across it until it’s all said and done, and then we pack them up and get them out to the customers.
Kurt Elster: Watching those laser engravers is fascinating, but also quite… Really not good for your retinas.
Brian De Groodt: Yeah. We use a fully enclosed laser engraving machine that has some… I don’t even know what it is. UV blocking glass that’s on top of it. So, you can sit there and look at it. I’ll throw the iPhone in there from time to time and record a time lapse just to show it, and that’s okay. That’s okay to look at. But yeah, you’re right. We do have one open laser that I can tell the story about when I set the shop on fire with the original laser.
Kurt Elster: Oh, geez.
Brian De Groodt: This one is an open laser, as well, and I have this bad habit of just saying, “Well, let’s plug it in and fire it up and go do these things.” And come to find out staring at laser isn’t really great for the eyes.
Like, “Why do I feel like I’ve been in a dust storm?” I think I know why.
Kurt Elster: Oh, geez. Really sizzle your eyeballs.
Brian De Groodt: Yeah. Yeah. Don’t do it.
Kurt Elster: So, your Shopify store, I love… It’s got this DIY-zine quality to it that speaks to there is a punk rock nature of biking culture, like if you’re a shop rat working at a bike shop. It has its own culture. And what I love about this brand and your approach is you’re saying, “Hey, we’re gonna bring that, the best of that, in a really accessible way, to everyone who owns a bike.” Because the way bikes are assembled, they pretty much all have head stem caps, right? That’s so brilliant.
And as far as getting some to go like, “All right, you’re gonna do something on your bike,” this is a really easy component that pretty much anybody could swap out. You need a hex key, which I think you provide.
Brian De Groodt: Yep.
Kurt Elster: And that’s about it, right?
Brian De Groodt: Yeah. That’s about it.
Kurt Elster: Don’t overtighten it. You’re fine.
Brian De Groodt: Yeah. I can change my headset cap faster than I can my shoes and socks, right? So, yeah, I appreciate the compliments on the site. I think when we first launched, I’d been working to try to come up with a new way forward with the brand, and what I would describe our first iterations as after we got past the original awful site was we were the tattoo shop with the blacked out windows that you couldn’t see inside. So, it was like, “Ooh, I don’t know if I actually want to go in that place.” Right?
And now we’re trying to become the tattoo shop with the darkened windows, right? So, yeah, you can see what’s going on here, it looks pretty safe, actually looks like there’s pretty cool people in there, and let’s go ahead and head in. That’s kind of the guidance that I’m giving everybody that we’re working with right now is let’s back off the super counterculture edge of the brand and start kind of walking closer to… I look at Vans as a very aspirational brand where it’s somehow or another they’ve gotten the worst little hoodlum that you can possibly think of that’s out causing trouble to wear Vans, to dad, or grandpa even, that has grandchildren, and he’s still sporting Vans. And it’s an incredible story to be able to say I can walk across and still give you a little bit of an identity, and you make up the rest of that identity, whatever it is, right?
Vans shoes are not necessarily anything until you put the history of the brand and then the individual in it, and then you go, “Okay, now I’m just a grandpa out walking his grandchild at the park. Leave me alone.” Or, “I’m a 16-year-old kid that’s gonna be the next Tony Hawk at the skate park and I choose to wear Vans.” So, I think it’s an amazing way to be and we’re not the size of that kind of organization where we can really be all things to all people, but I do think we probably skew just a little too far to what the heck’s going on in there. We get customers that ask for bible quotes on their caps all the time and not opposed to it in any sort of way, but I always wonder like, “Did you scroll through all of the site?” Just want to make sure that we’re aligned here and that this isn’t some sort of joke.
But you know, that’s the market that we’re trying to serve.
Kurt Elster: And I love the product photos, especially for the headset caps, they look like renders, but they look real. The only giveaway that they feel like renders is how perfectly consistent they are. The presentation is identical across all of them. I think I recognize a Thompson stem here maybe. Thomson X4.
Brian De Groodt: You know, the original photos, Kurt, were actually in what everybody was doing I think back in 2017, which was go get a lightbox, blast a ton of light at it, put it on a white background, and shoot the thing. And you know, I think everybody should know exactly what they’re getting ultimately, right? I think there’s a good reason for that type of photo. But when you put a round object that you don’t know that you can actually do anything with on your bicycle, or that it’s even bicycle-related, on a white background, with some artwork on it, and you throw it up on a website, we got so many different random questions about like, “Is this a guitar pick guard? Or tuning knobs?” I forget what they were. And some other things. And you’re so myopic as the owner of the brand and the thing… You know, you work with this all day long. You’re like, “Well, how do you not know that this is a bicycle part?”
And so, one of the learning lessons early was let the data, let the feedback be the arbiter of truth, and it was like, “Okay, these make sense to me. They do not make the sense to the people that actually want to give me money, so let’s fix this.” And so, we worked really hard with a local photographer. He works in the bicycle industry. But we had to have speed to the photographs because what we used to do was to basically go out on a ride, come up with an idea for a design, go make that design, go laser engrave it in 11 different colors, take that over to a photographer, have that person photograph them, wait for them to get finished, put them back up, and we’re talking weeks, right? And now I can literally go out on a ride after we get off this podcast and an hour from now have an entirely new product development for sale, loaded to Klaviyo, announce it, and we’re making money.
And I think that that rendering… We recognize that it has to be extremely accurate because as you well know red isn’t always red, and blue isn’t always blue, and especially in anodized parts it’s like, “Well, this doesn’t match my Fox shock, and I want this color, and I thought it was gonna be that color.” So, we have to be really careful about this. We color calibrate. We take a lot of time and effort to really calibrate what’s going onto that site. But ultimately we have to be able to get that product loaded out there quickly.
And the number one product in here it appears is a headset cap that does not have your design on it. It offers personalization.
Brian De Groodt: Yep.
Kurt Elster: 557 five star reviews. Any brand that can in a practical and realistic way engage in personalization, I would absolutely encourage them to do it. Because… What was the premise of this entire business, of this entire episode, was hey, we want to customize the things we own to make them ours. Well, what better way to offer personalization on the site? And in your case it’s like, “All right. You can pick the color. You can pick the bolt color and get some contrast there. And then you choose the text and the typeface.” And so, how the heck did you do that? This is a product options app? How do we make this work in Shopify?
Brian De Groodt: Yeah. In Shopify we are now using only metafields. This has been one of the big tasks across the last year is to get rid of… No offense to any app builders out there. I think they do a great job. But I think the default response in the past was always, “Which app can do this thing?” And now Shopify has really armed us to say, “You don’t need to necessarily have an app all the time.” And I feel for the developer community at one level, but another level it’s like, “Hey, look. This actually broadens the ability of your capabilities as a developer.” And even though I’m in Shopify’s interface every single day, I don’t want to mess around with metafields, so I still have somebody else that’s technically qualified to do that for us, and from a personalization perspective there’s upside and downside, right?
So, the upside is one, of course, seeing what customers want to put on their headset caps is hilarious, because there’s so many different things that I get to see every single day that come across and you’re like, “Wow. That person should probably be a little nicer to themselves,” or, “That’s really funny,” or, “Wow, I know that somebody’s going to be getting married or engaged before the person that’s getting engaged knows it,” or that they’re pregnant, you know? So, I’ve seen a lot of really memorable caps come across.
The downside, of course, is this is a physical business at that point, right? I can’t send all of our inventory off to a 3PL and say, “Okay, you handle the rest of this.” We have to manufacture to order, and I guess from a Shopify operator’s perspective, I would just share with anybody that’s thinking about personalization that you either find somebody that can do that for you and do it to the expectations that you have or be prepared to do that personalization in house and be there.
Kurt Elster: Well, and do you ever have issues just like… People will be creative and they’re going to play to the rules within the confines of what you gave them, so it’s like yeah, they’re playing in your sandbox, but they still get to do whatever they want. Do you ever get stuff that’s like straight up we can’t print this?
Brian De Groodt: I’ve seen things that have made me question why an individual would want to stare at that for hours on board their bicycle. We’ve never gotten anything… I have a pretty I guess undefined line of where I would send something back to somebody and say, “No, we’re not doing that.”
Kurt Elster: You’ll know it when you see it?
Brian De Groodt: Yeah. I think I would definitely know it when I see it. And also, I guess at some level because we’re not beholden to… I mean, you look at the brand, right? It’s like, “Look, if you come around here and give us shit, we’re gonna give you shit back.” That’s just the way it goes, right? So, if you want to come around with attitude, or hate, or things of that nature, and you’re trying to make some sort of point that’s… I’m not saying I have the ultimate authority on whose opinion matters and doesn’t, but if it’s just something that crosses the line, kind of like I think Discord always has these rules when you go into a new group, right? It’s like basically be nice. Just be a good person. And you know, you can define that in a lot of different ways, and we saw a bunch of stuff about, of course, Trump, and Biden, and sometimes I have to catch up with the cool kids. It’s like, “Oh, Jeffrey Epstein,” multiple Jeffrey Epstein caps came across. I’m like, “What is going on here?”
Kurt Elster: Weird.
Brian De Groodt: Because there was this whole meme about… I forget what it was, like Jeffrey Epstein didn’t kill himself or something like that. And it was just like, “Who wants to look at this on their bicycle?” But you know what? That’s fine. If you want to look at that on your bicycle, you want to pay $25 to look at that on your bicycle, that’s fine. If it was something really crossing the line, I think that’s probably getting pretty close to it, but so far, like I said, we’ve never had to send anything back. I suppose having your own money invested in that thing probably… It’s like how many people would pay $25 to say the tweets that they say on Twitter? Are you really that committed to it? It’s like, “Okay. Well, no. I’m not really that committed to it.” Okay, that kind of is the self-selection process there at some level.
Kurt Elster: So, the moment you charge for them just kind of reduces some of the zaniness.
Brian De Groodt: Yeah. I think so. I think also… So, we’re moving into graphic images, as well, so people will be able to ride along with their cats on board, or whatever photo they want to send us, and one of the concerns we have about this, because we don’t have tens of thousands of dollars to create a custom image mockup and really understand from a 3 megapixel photograph of their cat from 1990 that it’s supposed to be in the upper lefthand corner, and Fluffy’s face is supposed to be exactly here, so since we don’t have that investment to be able to make there, what we’re going to do or what we are doing is saying, “Okay, you pay for it. We’re gonna provide you a couple of different mockups. You’re gonna pick from A, B, or C, and then it’ll be done.” And I think that kind of transaction that I’m committed financially to this really kind of keeps some of the wheels greased. Let’s just put it that way.
Kurt Elster: Are you a solo founder? Is it just you?
Brian De Groodt: I am. Yeah. I had partners last year, as you may know a few of them. I have run the business always by myself. I have had, during the season, high season, I’ll bring in help. But otherwise, it’s been just me. For a brief period of time, I did have some fellow investors that were coming along with me, but we’ve since kind of rearranged that agreement and bought that out, and it’s just me.
Kurt Elster: And so, you’ve been at this for five years. It’s just you. What keeps you motivated?
Brian De Groodt: It’s a good question. For a little while through the startup ramp you have these… I think as an outsider, you have this vision of like, “Oh, you’re in the cycling industry so you must ride your bicycle constantly.” And I wasn’t, you know? Dirty little secret. I have a Peloton down here in the basement studio and so I would hop on the Peloton and go ride that for an hour, or some period of time every day, but I wouldn’t get on the actual bicycle. And I think that there’s a big difference between a Peloton experience and an outdoor experience.
And for the last year now I’ve really focused on saying, “Okay, let’s get on the bicycle.” So, one, staying mentally healthy and living up to the mission of Dispatch, but also two, just having that opportunity to connect with customers and to get those inbound responses back from them about what this little thing that sometimes, because you’re staring at hundreds of them a day, is actually bringing to an individual.
And it sounds cliché, but those are truly… They’re truly motivating to see that. When times get tough, or February obviously is extremely slow here, it’s like, “Oh boy. I don’t know. Are we gonna make this? How do we make a year’s worth of living on 10 months’ worth of business,” kind of thing. You just… You see that and you go, “Okay, yeah. We can’t not do this. These are changing lives and that matters.”
Kurt Elster: Yeah. The seasonal nature of outdoor recreational brands, and cycling especially, is just… It’s the reality and it’s brutal, and you don’t realize, even selling online, where it’s like, “Well, yeah, it’s warm somewhere,” but even mentally it changes even in places where the climate… If I live in Florida, realistically the weather is better in the winter for riding. But it’s still like mentally it’s not as top of mind even in places where the weather makes sense. And so, it’s just a tough business. Do you plan for it? Do you ramp up marketing efforts?
I remember in the bike shop they’d say like, “Well, in the winter is when the hardcore people that are 135 pounds with their $15,000 time trial bike, they know that’s when you do your building the bike, getting it maintained,” and so we’d try to go after those people just to shore things up. Any strategy there? Or is it just like, “All right, we gotta sit on cash.”
Brian De Groodt: No. We don’t like sitting on cash because we’re growing the business, right? So, we have to reinvest that into more inventory and more product. So, to that point, the headset cap is not really a consumable thing, right? We don’t really want to do some unnatural like say, “Oh, let’s get the headset cap of the month subscription.” That doesn’t make any sense either, right?
But what we do know is customers, after they transact with us, have a pretty good relationship with the brand, and they want more from the brand. So, that can lend itself to things like T-shirts, and hats, and riding jerseys, and kits, and things of this nature. So, we’ve done well by bringing that and pushing those types of products through those slower periods. I will say, and you know, I’m no climate surgeon, but this year has been particularly interesting to watch the seasonal changes that have come across North America, where Arizona, New Mexico, Florida, Texas, Louisiana, all those states would typically carry us at a lower volume ultimately, lower dollars total, through the season. And as we all know, I think New York didn’t even have any snow until like February or something like that this year, right? So, everyone down south was getting hammered with weird weather, certainly weather they weren’t gonna be riding in, and it has had an interesting effect on our business.
We’ve been able to work pretty hard with other brands that are in the industry that we’ve basically said, “Hey, look. You sell jerseys, or you sell bicycles, or you sell other things that are adjacent to what we do. Would you be interested in bringing these out to your customers during this period?” And to your point, the endurance rider, the guy or the gal that’s going out in spring of this year to go ride some of the races that are already happening, they’re training through the winter, right? And so, yeah, maybe on a trainer, which is all the more reason to have some motivation inside. I’m in the basement, it’s dark, it’s cold outside, I’m doing these miles on this thing, doesn’t even move, I can’t get any wind in here, and I need some sort of motivation to stay on the bike.
So, all of those things put together help us get through it. We’re not in any way making whatever, 12 months’ worth of living on 10, but you do have those slower periods. Being an honest operator with myself, what I always say is seasonality isn’t yet our problem because we aren’t at the top of the market. If we had tapped out on the market and said, “Hey, we’re doing 100% of everything we could possibly do in these categories and seasonal weather changes just happen, and we just have to adjust to that,” great. That’s fine. But we’re not there yet.
And so, I think it’s really important to… Just like you see a Wall Street earnings report and you’re like, “Oh, it was XYZ thing.” You’re like, “How did that actually affect your business? I’m curious. Because that’s just popular to talk about right now or because you don’t want to get fired?” So, it’s like, “I better come up with something because somebody’s gonna be asking some questions.” I don’t have that luxury, right? Because if I lie to myself about that sooner or later this comes home to roost.
Kurt Elster: That’s such a good way of looking at it. What’s been one thing that’s surprised you most since starting this journey in 2017? 5 years ago?
Brian De Groodt: So, I mentioned lighting the shop on fire.
Kurt Elster: That’d be quite the surprise.
Brian De Groodt: Yeah. Yeah. I got the first laser that we actually invested in. It has basically the same exact cable that you would plug into your laptop for a printer, and I was like, “Printer cable, turn it on, connect the printer cable, light this thing.” It’s like, “Well, what do we have to laser on?” I don’t know. There’s a piece of cardboard over here. Let’s put that in there. Cardboard and lasers don’t get along too well.
Kurt Elster: Whoa!
Brian De Groodt: I mean, it works really well, and so I think kind of in a roundabout way the amount of things that I’ve had to learn, and the trial by fire literally has been surprising for me because I came from a career where I just… I could literally land my feet on the ground in the morning and go do the thing, and make a lot of money doing it, and didn’t… Of course, you have to stay up to date and stay relevant, but it’s just very different as an eCommerce operator. And I think that the surprising thing for me as an outsider coming in is that I believe that a lot of people, myself included, will look at the industry, especially the smartest people out there that have done extremely well, and believe that there’s some sort of magic that they have. And it’s like pay for that course, and buy that thing, and like all their tweets, and whatever else, and at the end of the day the surprising part of it is it’s no different than anything else in life. You have to do the work. You have to create something that people want. And you have to get in front of enough people to actually tell them about the thing that you think they want. And it happens.
But you have to have that fortitude to say, “I’m just not gonna look for the tricks, or the shortcuts, or whatever else, and just stick to the fundamentals.”
Kurt Elster: You know, very much like having a great experience with a bike. So, you said you gotta get the audience, get in front of the right people. How does Dispatch Bike do that today? I’m guessing there’s some content marketing. You have quite the podcast setup there. I’m very impressed.
Brian De Groodt: Thanks. Yeah. Again, we sit at around a $45 average order value, right? So, when you start chipping away with paid acquisition costs, this can get real thin, real quick, right? Because I still… Even though we sit at a 90% top line margin, we have some serious costs that we have to take into consideration when we talk about acquiring customers, especially in something like our product, where it’s not, “Hey, I’m solving adult acne. I can totally create an ad super quick, right?” It’s like, “Hey, do you suffer from adult acne?” And you know, the ego play and everything else, and, “Hey, here’s the solution to it.” Ours is like, “Hey, your bicycle is totally perfectly functional without what we do, would you like to buy it?” Did you know you can buy it? Did you know you can change these things?
And so, I think most successful organizations that have a product that needs to be sold through an educational process have a lot of margin that they can deal with. Actual dollars. Hard dollars, right? Not just margin. And we don’t have that. And so, our strategy as of late last year was to basically walk away from everything except for either intention-based search, so I’m looking for this part and I’m going to do this, to trying to expand beyond that and write content, create content, and work with those that are creating that content to say, “Hey, you can do this. This is really cool, and you should… I have one. You should do one.” Right?
And so, we’ve spent a lot of time with outreach to… In the industry there are a number of kind of pop celebrities that are either funny, or educational, things of that nature, but they have an audience they built up for years before we even thought about this, so we’ve leveraged quite a bit of that. And then recognizing that we were suffering from a sickness called going to Facebook and just giving $10 to make $8, that we have to wean ourself off that and ultimately that’s a longer-term play and that involves creation of as much content as possible, and what I wrote to myself in Q4 of last year was one of the reasons that I’m attracted to cycling, one of the reasons I think the brand can exist nicely in the industry is that there is a beautiful aesthetic to cycling. There is an opportunity to exist in an area that, as we call it, less posh, more punk, and we believe that that’s the place that we can author content, and have interviews, and create things that attract people to Dispatch.
Kurt Elster: And so, are you running a podcast now?
Brian De Groodt: We are. I had episode one in January. It was a great learning lesson. Podcasting, when you watch all the YouTube videos, and you, I’m sure, well aware, I had me Rodecaster Pro 2 sitting over here right now with all the fancy buttons, and we’re working on going through more. We’ll do 24 episodes this year is my goal and I have a lineup of guests already, and now it’s just a matter of, as we talked about before, you have to turn on the microphone and start doing the work. The first iteration, that was a mess, but we’re getting there and I think the stories that we want to tell, which is basically I don’t care if you’re a Tour de France level type racer to I lost my car or my license through my own stupid decisions, through DUI or whatever, and now this is how I get back and forth to work, and this is how it’s changed my life, to everything in between there.
But it’s the bicycle at the center, and how has it changed your life, and how has it made it either better or different?
Kurt Elster: What do you call that Podcast?
Brian De Groodt: The Ride Your Ride Podcast.
Kurt Elster: Ride Your Ride.
Brian De Groodt: Yeah. That’s our big thing here. I do a lot of endurance racing and running, as well, and especially in running there’s this whole thing of basically race your race, right? Don’t worry about the people out front. Race what you can race or run your run. And I think the same thing with Dispatch. Our idea here, our mission is to get more people on bikes more often. And it doesn’t have to be the 135 pound Tour de France rider, right? It can be anything that you want it to be.
And nothing makes me happier, quite honestly, than going out here in our local city on a summer weekend, Sunday, going down to the local community park, and seeing a family riding their bicycle to the ice cream shop, and hanging out in the park. I’m like, “This is perfect.” Everybody’s together. Nobody’s been in the car. Everybody has a good attitude. It’s ice cream. It’s bicycles. It’s the park. It’s sunny. This is… Come on. What else do you need?
Kurt Elster: What’s next for Dispatch? Any products on the horizon? What are we doing?
Brian De Groodt: Yep. Yep. So, we invested in a couple of additional capabilities in house. One of them that we’ve been working on for quite a while, just to make sure that it would pass our tests, because laser engraving is very permanent, it’s very hard to abuse anything that’s laser engraved, but we wanted to bring in color printing, which, for anybody that’s old enough to remember the Wizard of Oz, when you watched the first X number, 95% of the movie, it was all in black and white, and then you cut to this color section at the very end and it was like, “Whoa! The world can be in color? That’s amazing.” And that’s kind of our experience with the UV printer where with laser engraving you’re always thinking in black and white because that’s all the laser sees. On or off, right?
And color has been really fun for us to start to work with, and in conjunction with that, with a partner here locally that manufactures the headset caps that we’re using now, it’s a holeless headset cap, so you have a full 34 millimeters on top to put anything you want on there, and as I mentioned before, we’ll be doing quite a few pictures of people’s cats, and dogs, and kids, and whatever else on there, but that’s a big one. We’re very confident in its durability now. We believe it can withstand just about as well as anything should in that position on the bicycle.
And then we’re also working on a series of frame protection, basically vinyl protection that goes on top of the bicycle to allow you to further personalize it and protect it from all the things that try to ding bicycles and make your $15,000 bicycle worth a little less.
Kurt Elster: Yeah. You don’t want to drop a road bike and watch that paint come off, that hydroformed aluminum or carbon fiber.
Brian De Groodt: Yeah. Yeah. Well, then instead of looking forward or at your headset gap, you’re just looking at the ding the entire time, and the ride’s no fun.
Kurt Elster: It’s funny. When it’s a mountain bike, though, or like a BMX and it looks ratty, then that means you use it.
Brian De Groodt: Yeah.
Kurt Elster: Whereas like the road bike, that’s your sports car of bikes. You want that one to be shiny.
Brian De Groodt: Yeah. Exactly. I mean, you can’t put it in the bed with you if it’s all not shiny, right? Just sleep with it.
Kurt Elster: So many motel photos of people at events, the bike’s in the bed. I’m sure motels are thrilled about this.
Brian De Groodt: Room for one? No, absolutely not. I need two beds.
Kurt Elster: You’ve got a coupon code for us so that other folks can get in on this headset stem cap action.
Brian De Groodt: I do. Yep. So, we created a custom code for all the listeners. It’s 15% off any purchase over $35 and you can use code technasty15.
Ezra Firestone Sound Board Clip: Tech Nasty!
Kurt Elster: All right. Brian De Groodt, Dispatch Bikes. If you are into bikes, you know this is what you gotta check out. Dispatch.bike is the site. TechNasty15 is the coupon code. I think I have the Go Fast, Don’t Die-
Brian De Groodt: Don’t die.
Kurt Elster: Go Fast, Don’t Die. On my bike.
Brian De Groodt: Yeah. That’s one of our collaborations. Yep.
Kurt Elster: Oh, I love it. Real shop rat stuff. It’s great. I’m feeling inspired and this… Spring just rolled around. I gotta get out there. Get back on my bike. Brian De Groodt, Dispatch Bikes, thank you so much.
Brian De Groodt: Thanks, Kurt. Send photos of that stem cap to me.