Courier Weekly Friday 2 October 2020

How an e-bike brand is capitalizing on Amsterdam's history as a bike city and a lack of Black representation in the marketing and advertising sectors

Courier Weekly Friday 2 October 2020

Courier Weekly Friday 2 October 2020

We catch up with Taco Carlier, co-founder of a Dutch e-bike brand VanMoof, about Amsterdam’s history as a bike city, opportunities in the e-bike sector and commuting bicycles in a time when no one is really commuting. Plus: Charlotte Williams of diversity-focused influencer marketing agency SevenSix explains how best to work with nano and micro influencers. 

DANNY GIACOPELLI: Hey guys, welcome back to the Weekly. I'm Danny Giacopelli, Courier's Editorial Director. Later in the show, I'm with the co-founder of the Dutch e-bike brand VanMoof, a company that's absolutely taken off during lockdown. They just raised $40m in their mission to get another billion people riding bikes. We talk about everything from Amsterdam's history as a bike city, opportunities in the e-bike sector, to commuting bikes in a time when no one seems to really be commuting, so stick around for that. 

But first, I'm with Charlotte Williams. She's the founder of the diversity-focused influencer marketing agency SevenSix, which she launched last year. A few months ago, when the Black Lives Matter protests saw a resurgence. We caught up with Charlotte on this show about the lack of representation in the marketing and advertising sectors. Well, Charlotte's recently launched a crowdfunding campaign for SevenSix. So I thought I'd take the opportunity to reconnect, to hear what's been going on in the influencer industry during Covid. Depending on what reports you read, it's either a good time to be an influencer, or it's the apocalypse. So what's really going on? Who's making money? Who's not? Who's spending what and why? And what are the opportunities to watch? Here's Charlotte.

CHARLOTTE WILLIAMS: We work with micro influencers, say under 100k. It's difficult to say what the bigger influencers were experiencing, but on the micro side people were still making money. Before the BLM resurgence I was still sought after, and I was still making a lot of money during lockdown, and that's why we launched our influencer network. I knew that I was making money and I was being put forward for campaigns, and some of them I didn't really want to do. I wanted to pass them on to people, but in a professional capacity. I hired my sister to come on board and look after talent, and we just built up a roster from there. At the same time, we launched the network, which is basically a database. It just means that when brands come in with a job, we've got a list of influencers you can pick from. 

Even before BLM, we didn't see a dip. We saw a rise, but a rise in nano to micro influencers, not in the larger ones. That's something to note about brands who were switching their budget. With things like content creation, brands weren't able to create content themselves so they were asking influencers to create that at home for them. I think that's a trend that will continue for a really long time, and I'm really pleased that that's a thing. I have done it for years and I did it a lot more during lockdown. It makes sense, get a professional content creator to create your content rather than paying a studio. 

But it's quite difficult. I didn't see a dip, but I know companies that did. It really just depends on who your clients are. One of my clients put us on half wage, they cut us down in terms of our hours but then we were still working. We still had influencer posts and we still had budget and they are a mainstream commercial store. They weren't selling on the website, but they knew that they would eventually. So it just depends on the position, I guess.

DANNY: Do you think that the nano to micro segment will remain strong? Is that a good option for a lot of brands?

CHARLOTTE: It's a really affordable option and it's a good way to dip your toes into influencer marketing. As long as you're working with professionals – and that's why it's good to work with an agency because they can be that buffer – who can do the job that you want them to do and as long as your contracts are properly done, you've taken into account usage fees, etc, it's important to note that small influencers can provide a really big impact. You can use their content on your website, their photography and I think that's a really good place to sit.

We do have a lot of smaller influencers who are nano that create really good sales, which is quite surprising to some people. We've seen some campaigns where we've put a massive influencer in who's got hundreds of thousands of followers and then we've put someone who's tiny, who has got 1,200 followers and the numbers have been the same.

DANNY: Numbers meaning the engagement?

CHARLOTTE: No, not engagement but in terms of sales it's been the same. We see it in beauty more than the other sectors that we work in. Imagine if you went to a spa and you absolutely loved it – you told everyone and their mum. People would really take your recommendation on board because you're their friend or brother or whatever. I'm working with Oddbox at the moment, and they're kindly gifting me a subscription. Since my first subscription, my brother got a box, my mum got a box because it was also 50% off your first box, my sister-in-law got one and then a couple of my friends got them, too. I'm not being paid for anything. I just got the box and I wanted to share it. That would be very different if a Love Island celebrity did it or Kylie Jenner. Fruit is great, but I'm much more interested in their lifestyle. I just want to see their Instagram pictures. So there's definitely a difference between nano, micro and macro, what they can bring to the table and what they can give to the brand. I think you just have to be really smart in how you use your budget as a brand.

DANNY: What about if I'm a brand and I want to get a micro influencer, a nano influencer's aesthetic? A lot of people are saying that the era of perfectly positioned flat whites with an overhead shot is all so five years ago, and now everybody, the Gen Z want gritty, realistic warts and all. Is that where we're all moving to? Hyper-realistic and less polished?

CHARLOTTE: Yeah, I think we're moving to that. But then we're gonna move back. I always say we've had avocado toast, we're now moving to real life, but then we're going to get bored of real life and we’ll have to get back to something else. Everything's trend-based, be that fashion, be that beauty, be that photography – everything comes in trends. Right now, we're really into real life, whatever that might mean with our filters, but real-life content. That's actually quite nice because it means that if you have acne, you can be a beauty influencer. If you have certain body deformities, or if you have stretch marks, if you're a certain size, whatever it might be, you can still work in fashion, and still post stuff. It just means that more people get an opportunity and I'm so for that, because not everyone looks exactly the same as we all know. Inclusivity is a really great trend.

DANNY: You guys have launched a crowdfunding campaign for the agency. So why crowdfunding? And what do you want to do with the money?

CHARLOTTE: I'm quite spontaneous as a person, this is a fact. I spoke to the team – there's currently four of us and we are all on part-time contracts, all freelance and everything operates within a small capacity. But we're being inundated with brands, and we're actually a go-to for a lot of agencies. Agencies are hitting us up and giving us work, which is amazing but we can only do so much because most of the team only work three days a week. I rely on picking up the slack and sometimes working 15-hour days. It's a bit overwhelming and something that we know about our industry is that ad agencies, 95% of them are owned by white men. The class divide between those white men is also quite extreme. 

There are very few agencies that are owned by people who are like me, not just in terms of my skin colour but, first of all, the fact I'm a woman. Secondly, my class. I haven't been born into a certain privilege and with that I don't have financial backing. I don't have friends whose uncle can give me  X amount of money and all of that stuff and that's not a cry for sympathy, it's just statistics and facts. 

I'm trying to make magic happen with the limited resources that we have and I just know that if we had more time, if we had a little bit more money up front, we could definitely do more. Then you'll have people asking about why we don't have investors. What we're doing is so sensitive, that I just feel so uncomfortable with the idea of having someone have any part of the company, at this point, when we're still trying to figure out who we are.

We wanted to go down a community-driven plan with this and just get a little bit of cash injection; be able to bring everyone in in a comfortable space where they can work full time, where we'll have enough money for the next few months. And know that if anything happens… And we know how fickle the world can be – we're on trend right now but we're already seeing people not that interested in diversity-focused things, even talks. I get asked to do talks all the time and then I do the talk and I catch up with them a few weeks, a few months later, talking about what they're doing internally, their anti-racism agenda and I know that people have left the company because nothing has happened. I'm getting tidbits from people on LinkedIn DMing me saying they've left a company because they didn't do anything. 

DANNY: So you were just kind of like the rubber stamp, the tick mark. 

CHARLOTTE: We're trying to work on that, really making sure that everyone we've done talks or workshops for, we can go back and check to see what's going on. I don't want anything to falter. There's a reason why I'm doing the job I do. I could work for another agency and get paid a really big wage, and live a very easy lifestyle. I've chosen weirdly not to do that. I work stupid amount of hours, I have a very unglamorous lifestyle, and I'm someone's boss. I don't want to be anyone's boss, and I'm doing a lot so let's make sure that we do it properly. That's where we're at. We've launched a crowdfund to give the team what they deserve. I'm hoping that the people that have followed me off of the back of the Black Lives Matter movement, and have watched my talks about racism and anti-racism, the ways that they can help in their companies, all tips that I've given free of charge – I'm just hoping that they will want to be part of this journey and to help make a difference. Even if we don't reach the full amount that we're looking for, we'll be happy with whatever we get and I'll be happy because I know that's going to my team who are working really hard. 

Something that I'm really proud of, as I was going through my accounts from last year, is that this year, and in the last three months alone we've actually paid £15,000 out to black and brown content creators from our partnerships. I don't know how that scales with other agencies but knowing that we have only been around for a year and we only launched this service in June/July, to be able to pay that amount of money to these people, especially during this time when money is so important. To be able to pay your bills during Covid, for a lot of people, it's difficult. So that we've been able to give money to our extended community makes me feel really proud of what we're doing. Regardless of whether I have a fancy house or not, I'm happy that I'm providing a service or something that's helping people's lives and livelihoods and hopefully careers in the future. It's been an interesting process, I've never done anything like this before so who knows what's going to happen?

DANNY: That was Charlotte Williams from SevenSix. Next up, we talk e-bikes. Dutch Brothers Taco and Ties Carlier founded an e-bike business called VanMoof 11 years ago. The goal was to get a billion more people on bikes and they're doing it with a pretty intense and efficient R&D and production process and by selling the bikes online directly. The pandemic hasn't hurt things, either. Tons of people have abandoned the tube, subways and buses and decided to pick up a bike. And a lot of those are e-bikes. Sales in the US actually rose 190% in June this year, compared to last year, and VanMoof saw its revenue explode during lockdown as well. I caught up with Taco from his home base in Amsterdam just a bit ago to find out more.

TACO CARLIER: There’s a big change going on right now. You're right, the e-bike sales were already growing with rates like 40% to 70%, year on year before Covid. In my hometown of Amsterdam, almost 50% of commutes are on a bike. That's easy, because Amsterdam is flat, it's pretty small and the climate is very bike-friendly. But if you want to commute on a bike in New York, London, San Francisco, Paris, Tokyo, it's much harder, and e-bikes solve that. They flatten hills, they shrink cities and they prevent any sweating on warm days. Therefore I believe that e-bikes will dramatically increase the amount of cyclists in cities all over the globe. That’s what is happening right now – you see it everywhere. In London, Paris, New York, you see a dramatic increase in the amount of cyclists on the streets, and a lot of them are e-bikes. I think e-bikes remove the barriers for the masses to commute on a bike, and therefore they're key to getting the masses on bikes and turning cities all over the globe into healthier, greener, more livable places. I believe this is just the beginning. 

DANNY: But if nobody's commuting anymore, what good is a commuter bike?

TACO: That's the strange thing. There's a big e-bike boom going on. The amount that e-bikes were growing was very fast even before Covid. But Covid pushed everything forward and sales are going through the roof right now. On the one hand, people are not commuting that much anymore. On the other hand, people want to get out, they can't use public transport and so people are looking for new alternatives such as walking, cycling and e-bikes. But you're from London, right?

DANNY: I live in London. I'm from New York. London's not really a city necessarily made for cycling, although they are changing a lot of the infrastructure right now to be a bit more cycle-friendly.

TACO: I don't agree with that. That's what everybody said about Paris, too, and then this summer it all changed. They closed down a few avenues and bikes popped up everywhere. I also believe you see more and more bikes on the streets in London every day. So I don't agree with that. 

DANNY: There's certainly more bikes. Do you think living in and being from Amsterdam changes how you think most people use bikes? Obviously, that's the most bike-friendly city on the planet. Other cities are really not built for it.

TACO: Everybody thinks that Amsterdam has always been like this, which is also not the case. In the seventies and eighties, a few great hippies stood up and said, we don't want these cars anymore, get them out, and they built bike lanes. Only since then has a bike culture started growing. In the sixties, Amsterdam was completely overtaken by cars.

DANNY: I didn't know that at all. So it was actually a conscious decision to become bike-friendly. It wasn't ingrained in the culture for centuries?

TACO: No, definitely not. Of course, Amsterdam has the perfect conditions, so it was logical that it started here. We say Amsterdam, but Copenhagen and some German cities are just as good. But now that e-bikes have appeared and as they are invented, the conditions in San Francisco, London, Paris and Tokyo are just as good as in Amsterdam. That's what the revolution is about. I think London is an exemption right now in Europe. I haven't been in London the past six months, but what I've heard about it is that it's completely closed down. Most people moved out of the cities, offices are closed, and therefore in London, you're right, nobody's commuting anymore. But in most German, Dutch, French and Belgium cities, it's not like that. Yes, the big companies are working out of home but people still commute, as people still have to commute. As they can't use public transport as much any more, people are looking for alternatives and they end up with e-bikes. Commuting has gone down, but not as dramatically as in London.

DANNY: I read that you guys sold more bikes in the first quarter of this year than you did in the previous many, many, many months prior. I assume that was because of Covid. Were you guys prepared for such a surge in what must be a really complex production process?

TACO: Yes, and no. Of course, these are weird circumstances that nobody was really prepared for. But we were prepared much better than other bicycle companies and that was mainly due to our approach. I founded the company with my brother 11 years ago and what we did is completely reinvent how bikes are made. All other bicycle brands consist of 90% to 95% standard parts, so they all use the same brakes, wheels, you name it. What we did is redesign every component of the bike. It started with frames, lights, pedals, wheels. Then, seven years ago, the focus slowly converted to electronics, batteries, motors and now the focus is more on software. That's the smartphone apps, all the backend software. Because we are circumventing the entire bike industry, we didn't have as many issues as other parties. Everybody's selling more bikes so everybody needs more components right now and that's where the big issues are. The suppliers of the components can't scale up fast, they can only scale up 5%, 10% maybe 15% per year, but not 200% like we do. We were lucky that we are independent of the bike industry, that we produce and design our own components, which allows us to scale up much faster during the pandemic. Still, it was not good enough. Demand was just almost unlimited. We could have sold even more, but it is what it is.

DANNY: What does the market look like in terms of your competitors? Is this a market where any number of e-bike companies can jump in and start up? I imagine there must be a huge amount of initial capital required to start up a bike company. Is it a winner-take-all thing or is there room for different players?

TACO: In the past, everybody could start an e-bike company, and they still can. You just go to China, you buy some e-bikes, design your own brand, put a sticker on it, and you have your own e-bike brand. Maybe you can even put the wheels on it in the UK and then you can say it's assembled in the UK. A lot of people have been doing that and are still doing that, and sometimes it works.

We did it completely differently. There's two things that set us apart. The first is our focus on engineering and on R&D. For the past 11 years, with a team of now up to 60, 70 people, we've been redesigning the entire supply chain and applying the rules of the consumer electronics industry. The second is that we sell directly – not many companies do that in the bicycle industry. Ninety-nine percent of the bikes are still sold via pretty small, independent bike stores. So that's the two things. We redesigned the supply chain, and we sell directly to our customers. Directly means we have 11 flagship stores all over the globe. We have stores in Seattle, San Francisco, New York, London, Paris, Tokyo, Amsterdam, Taipei and Berlin, but we sell 95% of the bikes online.

If we look at our competition, most of the brands are still really traditional having been in the market for 50 to 100 years and they all operate very local. Every country has its own brand. In Holland, we have Gazelle and Batavus. In Germany, there's Kalkhoff. I think in the UK it's Raleigh, and in France I think it's Peugeot. All these brands have a large range of models. We believe that model is very inefficient, and it can be done much better in a more modern and digital way. That's what we are trying to do with just two models, but sold all over the globe. We sell directly to consumers and that way we are able to produce better bikes for a more affordable price.

DANNY: At Courier we're always on the lookout for really interesting gaps in the market and opportunities for smart people who want to start a company. Are there any opportunities that aren't explicitly in making bikes and selling bikes, but maybe on the periphery of the industry? Accessories, apps, charging hardware that would mean people could have a lower barrier to entry.

TACO: That's the perfect way to start a business. That's what we did, too, when we started 20 years ago with our first company, which was started with just €1,000 of capital. We founded an identification wristband design company, did that for 10 years, then hired a CEO. We then used the cash flow from that company to start our second company, VanMoof. At the moment, I believe that the business model for the traditional bike shop is dead. That business model is based on selling bikes in combination with fixing bikes, but selling bikes becomes more and more difficult. Bike sales are shifting more and more online. Brands are selling increasingly more direct. But I think there is still a good business model in setting up independent repair shops that fix bikes on the spot. In terms of accessories, it's a very crowded market. There are some good examples: bike lights, mounts for iPhones, new helmets, new raincoats. These are some good examples, but it's hard to make your mark.

DANNY: And that's it this week. As always, if you've got any questions or comments, just hit me up at danny@couriermedia.co. Courier Weekly is back again next Friday. Thanks for tuning in.

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