After a certain point, you can’t get more wet.
I learned this lesson when I was 15-years-old, riding my bike through a torrential downpour to get to my girlfriend’s house.
My bike was a hand-me-down, a green 10-speed Schwinn with a squeeze horn on the handlebars.
I loved that bike:
It was my ticket to freedom. It took me to new neighborhoods, new worlds.
And I’m not alone: the love I had for my first bike is a universal rite of passage.
But recently I learned about a new kind of bike… a bike that people love even more than their first.
Worldwide, 35 million of them were sold last year.
Today I’ll tell you what’s going on here…
And then I’ll tell you how you could profit from it.
The Ever Popular Bike
Today, more people than ever live in urban areas.
Traffic is at all-time highs, which is why bikes have found a new popularity.
For example, in dozens of cities around the world, bike-sharing programs are gaining traction. These programs offer “on-demand” bikes on every street corner.
But on a hot summer day, it’s no fun working up a sweat biking to work, or pedaling up a steep hill.
That’s where electric bikes come into the picture…
This Market Is Electric
Driven by high urbanization rates and innovations in battery technology, the market for electric bikes has recently exploded:
In 2015, a whooping 35 million “e-bikes” were sold.
And according to Navigant Research, by 2025, sales of e-bikes will reach $24 billion.
But that pales in comparison to the market for traditional bicycles:
Globally, 130 million bicycles are produced each year, making them far more popular than e-bikes.
That’s because, for most consumers, electric bikes are still too expensive and cumbersome.
But this is where a start-up called GeoOrbital comes into our story…
Reinventing the Wheel
In Cambridge, Massachusetts, two men — one a tech entrepreneur and the other an engineer from SpaceX — recently teamed up to solve this problem.
They aimed to make it easy and affordable for anyone to get their hands (and feet) on an e-bike.
But instead of creating a new bicycle, they created a new kind of bicycle wheel.
This futuristic device converts any bicycle into an electric bike simply by replacing the front wheel with the GeoOrbital Wheel.
This wheel itself powers the bike.
Here’s what it looks like:
As you can see, it has no spokes:
Instead, it contains 500 watt motors, a computer, and 36 volt removable Lithium-Ion batteries that can power a bike at 20 MPH for up to 20 miles.
As reported in Inc Magazine, with a 60-second installation time and priced under $1,000, the GeoOrbital wheel allows people to use their current bike "to bicycle to work without sweating, or to ride via routes with hills that they would otherwise be unable to conquer."
And with more than 1 billion bikes like my old Schwinn already roaming the earth, the potential market for such a device is enormous.
Progress To Date
The reception to the GeoOrbital wheel has been impressive:
In just 45 days, the company received $1.26 million in pre-orders...
Time Magazine said, "Swap out the old front wheel for a 21st-century one"…
And Ben Coxworth from New Atlas (formerly Gizmag) wrote: “Of all the cycling gadgets we've had the chance to test here at New Atlas – and there have been quite a few – the GeoOrbital Wheel has got to be one of the most fascinating... it looks like it belongs in the upcoming Blade Runner sequel..."
Retailers like Best Buy now carry this device, and since its launch, the company has done an additional $1.8 million in sales.
But now it needs some capital to help it grow even faster.
Which is where you come in…
Investment Round
GeoOrbital is currently raising $1 million.
Any investor can get involved, regardless of their income or net worth.
The minimum investment is just $400.
But should you invest?
Let’s take a look at a few of the pros and cons.
Kicking the Tires
On the “pro” side, this start-up has a great team and has quickly made a lot of progress — from getting its innovative design off the ground, to reaching millions of dollars in sales.
But there are a couple of “cons” here, too:
First of all, GeoOrbital is a hardware company. It creates a physical product.
As compared to companies in the software industry (such as Google or Airbnb), hardware companies require greater levels of capital to launch and sustain themselves. While such start-ups can become successful, statistically speaking, their relative lack of capital efficiency correlates to a higher risk of going out of business.
Secondly, its valuation is a relatively high $10 million. To make 10x your money on this investment (which is what we aim for on early-stage investments), this start-up would need to get acquired or go public for at least $100 million.
Since the majority of start-ups that get acquired do so at levels closer to $30 million to $50 million, we prefer investing at valuations of $5 million or less, so we can hit that 10x number.
With that being said, if you’d like to learn more about GeoOrbital (and potentially claim a stake in it), you can do so here »
Happy Investing
Please note: Crowdability has no relationship with GeoOrbital, or with any of the companies or platforms we write about. Crowdability is an independent provider of education, information and research on start-ups and alternative investments.
Best Regards,
Founder
Crowdability.com
