The Problem with Crowdfunding

So our Crowdfunder has a attracted a few negative comments mostly from the hard of thinking and not helped by the above headline in the local press (Thanks guys, next time try and spell my name right and get the company name right. Quality Journalism!) and it seems to have stalled a little so I thought I’d give you a little more background and transparency about where and what we are as a company. So buckle up and grab a cup of coffee as this might get a little long!

So yes, it’s true our turnover in the past three months has doubled. Before COVID hit we had 4 members of staff, we now have TEN people working at the Electric Cycle Company, so our wage bill has more than doubled. Everyone has to eat and so unlike a lot of the mainstream big bike companies who pay atrociously low wages as they’re usually owned by venture capitalist all my staff are paid well above the living wage for Scotland (and I buy them pizza EVERY Saturday) This means we can retain and train quality staff who aren’t going to move jobs for 50p an hour. Important so you, the customer, get the best service. That tsumani isn’t looking quite as big now!

Also I invested everything I had in getting as much stock in as the company could afford so that our staff had something to sell and I could keep them working and you guys could get bikes.


Onto the Crowdfunder. £70,000 seems a bit excessive right? Lets’ talk about that sum. Firstly that £70k attracts the dreaded VAT so straight off the bat our friends at HMRC want £14,000 so we’re down to £54,000. Indiegogo have admin fees which takes another £2000. So now its £52,000. My outgoings so far on lawyers, architects and structural engineers are around £12,000 so £40k left to spend on electricians, plumbers, joiners and materials and hopefully have a bit left for new demo bikes.

If you’ve read this far, you deserve a reward so I’ll let you into a secret. Our existing shop at 133 Granton Road is going to become a separate social enterprise called Urban Initiatives. (registered at Companies House if you don’t believe me) This will deal with bike repairs, training people for cycle related jobs with the aim of helping people back into employment after COVID and making the city I love a better place to live and work.  This requires tools and equipment and myself and my partners are starting this from scratch and to make it work I’m basically donating most of the tools and kit from our workshop to start them off which means I’ll have to replace them in the new premises Here’s what a basic set of workshop tools cost

Our Indiegogo Crowdfunder was never about lining my pockets, I sincerely want to give people value for money as I always do. If I wanted to get rich, I’d never have opened a bike shop. Our perks are basically us doing work on your bike at cost in return for your money up front.

I personally get a warm, fuzzy feeling from helping people get on bikes. The new store will allows us to do that better and we will be able to give away more stuff and help more people like bigger donations to charity, more work with local groups like Granton Youth  and things like free insurance, free bike marking and free breakdown cover for every bike we sell without the millstone of a huge loan round our necks.

Thanks for listening (and your donations).

Neill

(Owner)

www.electriccyclecompany.com/recharge