COMPANY:Rad Power Bikes
HEADQUARTERS: Seattle, WA
YEAR FOUNDED: 2015
2016 REVENUE: $7 Million
Editor's Note: Inc.'s 12th annual 30 Under 30 list features the young founders taking on some of the world's biggest challenges. Here, meet Rad Power Bikes.
Mike Radenbaugh didn't intend to start a company that would, one day, generate millions of dollars. He just needed to get to school on time.
In 2005, the then-15-year-old started going to a big, regional high school 17 miles away from his childhood home in a sleepy rural town near the Lost Coast of Humboldt County, California. The 34-mile round trip was too far to cycle on his mountain bike and the bus wasn't reliable. For inspiration, Radenbaugh joined an online forum of "similar-minded geeks" and explored ways he could power his bike with a battery. He went to a motorcycle shop and a Radio Shack to buy parts and got to work. Six months later, after fixing mistakes and waiting for parts in the mail, Radenbaugh cobbled together his first "Franken-bike," as he describes it.
"It didn't look good; it had a lead acid motorcycle battery, a brushless motor, and all the wires were encased in Tupperware," says Radenbaugh. "But it went 35 miles per hour, and everyone in town got excited about it."
The local newspaper, the Redwood Times, ran a story about Radenbaugh's electric bike and he started taking custom conversion orders. Rad Power Bikes was born.
"Most people came to Humboldt to live light on the earth, but you need a car because it's a rural area," says Radenbaugh. "The electric bike captivated the people who believe in exploring alternative energy."
That desire seems to have even broader appeal, as Rad Power today commands high praise from customers. "Most of our growth is driven by our existing customers who love to share their bikes with friends and people passing by and spread the word about what our company is doing," says Radenbaugh.
Today, with 28 employees in tow, the Seattle-based company sells tens of thousands of bikes each year. In 2016, it reeled in $7 million in sales, and Rad Power expects to nearly quadruple that figure by the end of this year to more than $30 million in sales, says Hugh Holman, one of the company's investors.
That kind of success always seemed a ways off, however, says Radenbaugh. While building custom electric bikes paid his college tuition at Humboldt State University and grad school at UC Davis, it remained merely a side gig for many years. He operated a workshop out of his off-campus apartment, which he shared with his childhood best friend and business partner, Ty Collins. It wasn't until he attempted a crowdfunding campaign that Radenbaugh realized Rad Power's ultimate potential.
In April 2015, Radenbaugh and Collins, joined by their college friend Marimar White-Espin, started an Indiegogo campaign to launch the company's first bike, the Rad Rover. That bike marked Rad Power's first foray into electric bike manufacturing. (To that point, the company had exclusively conducted electric conversions.) The campaign had a conservative goal to raise $40,000. It blew past that goal, as 300 people bought an e-bike during the presale, raising more than $320,000. Rad Power bikes now sell for $1,500. After the campaign, Collins quit his day job as a marketing exec and joined his co-founders to start fulfilling orders.
They also caught the eye of local angel investors Mike Girton and Hugh Holman. "We found out that Radenbaugh had been making and selling bikes since he was 15 years old, and the Indiegogo campaign proved that they had a hungry market, ready for their product," says Holman. "It was the right time for us to invest, and Radenbaugh needed help to figure out Chinese manufacturing, which we have experience in."
Another thing that attracted Holman and Girton to investing in Rad Power was that Radenbaugh wasn't looking for tons of money. Rad Power just needed $180,000 to buy new inventory after fulfilling the Indiegogo campaign orders and start manufacturing its second batch of bikes.
In 2015, Radenbaugh and the crew built out Rad Power's flagship retail store and headquarters, a 10,000-square-foot space on the Salmon Bay in Seattle's Ballard neighborhood. The company also kicked up its online sales operation by offering free shipping. The company now sells bikes to customers around the country.
Looking back, Collins is somewhat dumbstruck by Rad Power's trajectory. "Starting Rad Power was a dream we had as teenagers; we're just kids from a small town," he says. "You don't have to be from a big city and an alum from a fancy school, you just have to work hard. It took us years to build, we worked after our day jobs and over weekends, but we made it work."