London-based Bike Club, a kid’s bike subscription service platform, announced on Wednesday that it has raised £16.75M (approximately €19.75M) in a Series B round of funding to gear up for national and European expansion.
Chaired by Mike Balfour OBE, founder of Fitness First, the bike subscription company says it will use the funds to expand its operation in Germany and France within the next 12 to 24 months.
What does Bike Club offer?
Founded in 2016 by James Symes and Alexandra Rico-Lloyd, Bike Club claims to be disrupting the kid’s bicycle market with its sustainable, flexible, and convenient service. The company delivers their bikes and scooters straight to customers’ homes and can be exchanged at any time as the child grows. The bikes are available for children aged between 0 to 14 years.
In November, 2021, Bike Club teamed with John Lewis Partnership to provide the retailer’s first kid’s bike subscription offering.
The monthly subscription programme, which costs between £4.49 to £15.99 per month, currently has a network of 40,000 bikes. And, with the new investment, the numbers may climb to 220,000 over the next three years. Subscribers are also set to more than double to 80,000 in the next year.
Founder and father of three, James Symes, says, “The pandemic, together with the growing trend for health and wellbeing, has spurred a significant uptick in family cycling and demand continues to be at its highest level in decades. Bike Club is on a mission to disrupt family cycling meaning you never need to buy a kids’ bike again. We’ve seen traction across the country with different families using us to get outdoors and enjoy a healthier more active lifestyle.”
“With our unique subscriptions, we take away the pain of getting the right quality bike and make giving your child the best sustainable gift. Kids grow fast and at different times, it makes no sense to spend £300 plus on a bike, joining Bike Club is the solution,” adds Symes.
According to the company, it is focussing on family cycling and the junior market. However, it also believes that there is an opportunity to help parents and other adults get onto bikes.
Nearly 900,000 children’s bikes are sold annually in the UK with a €4.3B opportunity in Europe. The on-the-go cycling subscription service is on track to deliver £5.8M of revenue this year, rising to £11M next year with a current company valuation of €53M. Bike Club’s fastest-growing category is First Pedal (age 3-6 yrs) with a 76 per cent increase in 2021 in comparison with 2020.
Customers can choose from a selection of bike brands including Frog, Forme, Strider, Woom, Puky, Squish, and Isla.
Investors in this round
The round was led by Circularity Capital, a private equity firm that invests in European growth SMEs operating in the circular economy.
David Mowat, Partner of Circularity Capital, says, “As society faces climate change, we should work together to consume better, meaning we should rent better things and refurbish them. This is exactly the option Bike Club gives tens of thousands of families across the UK. Bike Club’s circular economy means fewer bikes need to be produced each year. Each of their bikes is saving 336kg CO2 versus an owned bike. So far, their fleet has saved 1,174 tonnes of CO2 versus ownership.”
Besides Circularity Capital, existing investor Codex Capital also participated in this round.
Jamie Lawson-Brown, a co-founder of Codex Capital and Board member of Bike Club, says, “Codex Capital and its co-investors, including Brett Palos Investments, first invested in Bike Club during the summer of 2020. We have worked closely with Management, including navigating global supply chain disruption, and today are a much stronger and very well capitalised business.”
“Bike Club’s simple and convenient model offers customers the flexibility to make the right choices for their children and their wallets, and the business is perfectly positioned given consumers’ increasing focus on the environment combined with financial headwinds in the form of fiscal tightening, energy price rises and inflation. We look forward to working closely with Circularity Capital and Management to build the business during its next phase of exponential growth,” adds Lawson-Brown.