As Americans increasingly adopt e-bikes, the need for better products emerges. Bimotal is a startup producing a B2C powertrain that can transform any bike into an e-bike and a B2B powertrain for e-bike companies. It also designed a lightweight power-assist motor for wheelchairs.
We contacted Toby Ricco, Founder and CEO of Bimotal, to tell us more about his diversified business model and growth strategy.
In your own words, how would you describe your company?
Bimotal is an electric powertrain technology company that makes better motors, batteries, and software for small, personal-use electric vehicles. We are focused on bringing the highest level of engineering rigor to produce lighter, more dependable, easily serviceable, and adaptable vehicles to increase adoption and usage ultimately.
What inspired you to take the leap and start this company?
It started from a need. A skiing accident left me with torn cartilage in my knee, and as an avid mountain biker, the steep trails I loved were suddenly out of reach. Reliable e-bikes were heavy and/or expensive, so I created a small and modular powertrain (motor system) that could be added and quickly removed from my existing bike. From this, Bimotal’s first product, Elevate, was born.
What was the inflection point that led you to build and sell a B2B product?
Bimotal pitched Elevate to 50+ bike manufacturers. Unanimously, they thought the product was cool but wanted something more integrated and unique for their brands’ bikes. They also wanted to sell two bikes–a pedal bike and an e-bike–and Elevate would disrupt this model. There was a silver lining through these rejections: we found an incredible product/market fit. There are hundreds, if not thousands, of bike companies doing different levels of frame design and brand marketing. Yet, only a handful of powertrain companies can build the motor and battery packs to power these vehicles, and almost no one is willing to develop bespoke powertrains–except for Bimotal.
What is the size of a typical B2B contract and what are your margins?
A small to medium-sized bike company will buy 3,000 to 10,000 mid-drives per year; a larger bike company may buy anywhere from 30,000 to 100,000 mid-drives per year. Each unit sells for $1,000-$1,350 depending on specifications. We anticipate a profit margin of around 30%, with significantly higher margins from over-the-air software upgrades.
What is your break-even point?
Elevate breaks even at only 500 units, notable for a ground-up hardware/electronics/software product. Our mid-drive program requires a larger scale, needing 30,000 units annually to sustain the company and achieve a net margin. We’re targeting an internal production rate of 100,000 units or more per year.
Even if e-bikes are being increasingly adopted across the country, the United States remains a country where the car culture is dominant. What can you do as a company to bring more people to try, buy, and use e-bikes?
I see three key areas for change: Technology, Education, and Policy. Often, technology is the catalyst that shapes or steers policy. Our forte, both personally and as Bimotal lies in technology. We’ll leverage this strength and work to make e-bikes and small EVs more reliable, lighter-weight for enhanced portability, and more modular for easier service and higher flexibility. As we grow and prosper, we’ll channel our resources into education. Our vision includes hosting bike demos, tutorials, and safety training events at educational institutions to foster a future generation comfortable on a bike! This will create more customers for us, more healthy commuters, and increase our positive environmental impact.
Most investors backing your company are looking for a 10x return on their investment. What is your strategy to generate fast and high growth?
We are collaborating with strategic partners to expedite our journey to a 100,000-unit volume. We have a clear path to $100MM revenue on our mid-drive product, potentially achieving comparable revenue from our Elevate and Wheelchair powertrain offerings. Our commitment is to make a significant impact through scale, and we’re confident that success in this will naturally generate massive value.
If we speak again in 12 months, which milestones will you have achieved?
We will have a fully functional mid-drive capable of outperforming current market offerings and competitor developments. It will have undergone significant reliability testing. Elevate will actively scale the market across sales, production, service, and delivery. Moreover, we will likely have finalized a Series A investment with a major strategic partner.