The document discusses the challenges faced by the bicycle industry, particularly regarding the profitability of two-wheelers, amidst slowing growth and widening losses. It introduces a '3R' framework—reboot, retool, and re-entry—to address these issues and enhance value creation. The author emphasizes the need for strategic repositioning of product offerings and capitalizing on market opportunities, especially in the e-bike segment.

1. “Rise and Shine”: ReBoot, ReTool, Re-Entry (3R)
By: John F. C. Cheong, Ph.D.
Feedback and comments to: john@twobit.co.Rev.2016.0908

2. The Big Picture: Slowing Growth (M&M + MVML)
in Just the Last Few Years…

3. The Bad News: Shrinking Profits, Too…

4. Problem Area? Seeing FY16 Numbers in Perspective:
65% revenue growth…
… But widening losses!

5. The “Two-Wheeler” Loss Situation is Untenable:
… is rapidly consuming
2x deployed capital
(per year!)
Widening losses continued…

6. Bicycle Maker’s Value Chain
My nose says
this way…
Do the Math on 2-Wheeler Value Chain:
Seekmargins
you must.
Suspected problem areas
that need fixing!
FYI, scooters & e-bikes don’t mix!

7. Example: e-Bikes Product Positioning at a Glance…
e-Bike Comparison
Model QiCycle GenZe e101 Electrified S
Launch Date June 2016 Feb 2015 April 2016
Weight 14.5 kg 20.9 kg 18.4 kg
Range (Pedal-Assist) 45 km 48~80 km 50~120 km
Battery 5,800 mAh 8,700 mAh 420Wh
Motor Power 250W 250W 250W
Top Speed 20 km/h 32 km/h 32 km/h
ASP of e-Bikes $450 (¥2,999) $1,499 $2,498
What Does the
e-Bike Look Like?
Betweena rock
and a hard place!
Old
Heavy

8. Finding Balance (and Profits!) in “Two-Wheelers”?
…and then some, perhaps after
going through a 3-step process of:
ReBoot, ReTool & Re-Entry?
At the moment, ahem, these
2-wheelers give back far
LESS than what you put in!

9. The “3R” Process: ReBoot + ReTool + Re-Entry
Re-Entry
(Corp Dev)
ReTool
(Studio)
ReBoot
(Fund)
1
3
2

10. The “3R” Transformer Picture: BEFORE & AFTER
BEFORE: “Loss” at Sea…
AFTER: Sky is the Limit.
BitCo
BiGCo
… and Lots of Dogfights!

11. How Capital and Labor Combine Together to
Create Value； and How That Value Can Be Captured.
ReBoot
(Fund)
ReTool
(Studio)
Re-Entry
(Corp Dev)
1 32Venture
Capital
Expertise
Network
Deal
Makers
Value Creation Value Capture
Capital Labor

12. Welcome (Again) to Silicon Valley...
This time, let’s Rise (and Shine) together.
Feedback and comments to: john@twobit.co.
“If you can make it there,
you’ll make it anywhere;
it’s up to you…”