Solé Bicycles races past global competition
Do you consider yourself fashion-forward and practical? If so, then Solé Bicycle Company has the right two-wheeled solution for you. “Your bicycle should be an extension of your life. Solé bicycles are you, they’re your mobile canvas, and — oh yeah, they’ll get you there, too.”
Founded in 2009 by two friends who were fed up with the state of bicycles, Solé introduced high performance, stylish and affordable bicycles out of a small headquarters in Venice, CA. Solé president and sourcing director Jimmy Standley never pursued the entrepreneurial path for its ease and comfort. Like many small business owners, Jimmy and his team mates put in their dues during Solé’s infancy. “We didn’t pay ourselves, but what you put in is what you get out. We’ve had to bootstrap and grow this thing from the start.”
“Owning my own business is so fulfilling. I wake up each day so excited about what I do and who I work with.”
Five years later, they’re still doing what they love — putting their passion for “design, simplicity and community into every bicycle we create” — and their customers can’t get enough. With over 60,000 combined followers on social media, their brand was an immediate viral hit with Millennials looking for a better way to commute to work or cruise down the boardwalk on a sunny day.
For a seasonal product-based business like Solé, inventory takes a long time to make and can take up to six months to reorder. “We always reinvest our money in inventory and keep our overhead low. It’s a seasonal business, so we need enough funds to buy bikes to last through summer – and we always run out. It’s challenging to manage our cash flow to meet demand.” The solution? An affordable round of financing to meet rapidly growing market demand — or so they thought.
“The truth is, you’ll never grow your business with a loan shark taking 60-70 percent APR.”
Jimmy considered equity financing but ultimately looked for other options, noting that while outside investors “allow super fast hyper growth,” he ultimately preferred to own his entire business. To start, the Solé team received small loans from family and friends, but outgrew them pretty quickly. “Not many people can ask their pops for $100,000. I wouldn’t feel comfortable asking my parents for that.”
Next, Jimmy gave the traditional route a shot and applied for loans at big banks, in addition to community banks and inventory financing companies. He assumed the banks would love Sole as much as its customers did. The last thing he expected was that his application for a traditional bank loan would be rejected more than twenty times over the next two years. The owners’ relative youth and lack of personal assets made them risky borrowers in the eyes of traditional lenders. “No bank was willing to work with us, and we missed opportunities as a result.”
In early 2014, Jimmy decided there had to be a better way. “Lots of great businesses are started by young people out of college who don’t have a house or bunch of money saved up; it’s just impossible for people like us to get loans from these traditional banks.”
Like any good Millennial, Jimmy turned to the internet for answers. “I read a lot. I followed the blogs and eventually stumbled upon an article about online lenders. I instantly applied. There was no hesitation.” Soon thereafter, Jimmy elected to borrow $75,000 from the lender that offered Solé the best rate: Funding Circle. “Funding Circle worked really fast. From when we applied to when we were funded was really quick – way quicker than any traditional bank could do. It was really seamless and straightforward. An easy process, with no headaches.”
“Three words that remind me of Funding Circle: Easy, quick, reliable. Funding Circle has held up to everything it’s promised.”
Later that year when Solé was ready for another injection of inventory capital, Jimmy shot his Funding Circle account manager a quick email while waiting in line at the airport for a flight to China. By the time he landed, the second loan for $75,000 was already processing. One week later, Solé had the funds it needed to purchase another season’s worth of inventory, launch a new line of three-speed bicycles, and open a retail storefront in Venice.
Their full-time team of six also has plans to go global: by the end of 2015, you’ll see locals and tourists alike cruising around Europe and Australia on Solé works of art. More than anything else, securing funding from an alternative lender like Funding Circle “expedited all our plans, and pushed them forward quicker.”
The biggest lesson other entrepreneurs should learn from Solé’s saga of struggle and success? As Jimmy explains, “There are three types of loan providers: traditional banks, loan sharks, and online lenders like Funding Circle. The truth is, you’ll never grow your business with a loan shark taking 60-70 percent APR. Funding Circle is fair, easy and reliable, and fills a huge void in the market.”