The bikes with the pink sticker on the frame are neatly lined up for collection. They have just come back from the repairs – ready for the next 10,000 kilometers that a fast courier travels every year to deliver groceries. On the workshop premises in Cologne-Ehrenfeld, Henry Horn and Konrad Essers, founders of Smartvélo, literally keep the wheels of the delivery services turning: Their startup manages the production of high-quality E-Bikesthrough sales to repair and maintenance of the entire two-wheeler fleet for corporate customers such as Considerable, Lieferando and the luxury hotel chain 25 Hours.
What sets the startup’s e-bikes apart from the usual e-bikes on the market is the robust battery. “Normally, a battery installed in a standard bicycle lasts about 800 charge cycles. After two years it’s over,” says Henry Horn. “Our battery can be charged over 2,500 times.” According to the founder, Smartvélo is building the most sustainable last-mile delivery bike. They get the batteries from a startup near Hamburg, which also supplies Deutsche Post.
In their hall it smells of rubber, wrenches clink. Boxes with tires are stacked opposite the Flink wheels. “We get them from a prison in Bautzen, where the inmates lace wheels,” says Konrad Essers. Male voices are coming from the workshop, old music by Justin Bieber is booming. “There’s always a party here,” explains the founder.
Startup wants to attract craftsmen with a startup spirit
Your company now employs 30 people, around half of whom are bicycle mechanics. Like other craft businesses, the startup is from skills shortage affected. “Trained two-wheeler mechatronics technicians are extremely difficult to find,” says Essers after the tour. According to the founder, many of their employees would originally come from the automotive sector and switch jobs. According to the Service and Bicycle Association, there are thousands of vacancies in the industry. The Job-Plattform Stepstone reports around 2,500 vacancies for two-wheeler mechanics in Germany.
At times, Smartvélo trained young mechatronics technicians themselves, but no longer does so. Henry Horn: “The dropout rate in skilled trades is very high. You often earn less than 500 euros gross per month – that’s difficult to cope with.” The founder knows what he’s talking about. After school, he completed an apprenticeship as a clerk for audiovisual media.
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The boys plan to get more startup life into the “old-established craft business”. They want to attract skilled workers with a relaxed working culture, after-work events, fair wages and free weekends. Some things are done via social media, often someone brings former work colleagues with them to the startup.
From a mobile washing facility to all-round service for bicycles
Horn and Essers have been friends since they were young. Founding is in both their genes, albeit in different ways. Essers already knew as a student that he wanted to run his own company. It all started artistically for Horn: at the age of nine he co-founded the children’s band “Apollo 3” and took on several roles in German television productions such as Alarm für Cobra 11 and SOKO. After training at his band’s former music production company, the then twenty-year-old went to Berlin, where he began studying at the University of the Arts in 2019. The pandemic brought him back to Cologne, where he joined Essers’ first startup: Smart Racoon, a mobile bike wash.
Essers built the startup in 2018 after completing his training in event management. “Back then, for example, we washed the bicycle warehouses in several cities for Swapfiets,” says Essers. Team members from back then are still on board today. In June 2020 they founded Smartvélo together – a similar name with a new concept.
The friends initially pursued the idea of offering private customers a mobile all-round service for bikes. The founders used a transporter to pick up broken bicycles from the front door, repaired them and provided spare wheels in the meantime. In winter, however, demand dropped significantly – from then on, the founders saw an opportunity in the emergence of the fast delivery services Lieferando, Flink and Gorillas.
“We started servicing the previous delivery service bike fleets, our competitors’ bike fleets, so to speak,” says Horn. The bikes were often not well equipped for the intensive use of numerous courier trips. The founders gave tips on which brake systems had to be installed so that fewer repairs were necessary. “At some point the delivery services asked us directly if we could build them their own bikes.”
Her first customer was the Munich fast food supplier Burgerme. The Cologne-based company was supposed to produce seven bikes for him in a pilot project. Smartvélo did not yet have the huge production hall at the time. Instead, Horn and Essers opened their workshop on the site of an old Cologne nightclub – with workbenches made from stacked Kölsch crates. Their office – a converted car paint booth – “was freezing cold and stank like hell,” the two remember. The Pina Colada scent trees didn’t help either, because pigeons flew into the ventilation shafts “and never came back,” says Horn.
The duo didn’t let that deter them. Essers set up a production line together with the master fitter. “We placed all the components in a sequence next to the frame and gradually put all the parts together from the handlebars to the saddle.” With success: In 2021, the Cologne-based company received its first major order. The order: 180 e-bikes for the startup Flink.
Startup produced day and night for the first Flink order
In order to do this, Smartvélo not only needed a larger team of craftsmen, but above all more space – they moved to Ehrenfeld. There they divided day and night shifts for months, set up a large production line and spent the night in the workshop. “That was really awesome,” says Essers happily. “In December we brought another 180 bicycles onto the market in Cologne.”
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The startup has now delivered around 1,000 bicycles. The Cologne-based company no longer manufactures its own e-bikes locally, but has outsourced production to Porto. The largest European competence center for bicycle production has developed in Portugal: More than 60 suppliers and manufacturers of components work in the so-called “Bike Value“ together and produce almost three million bicycles a year.
In addition to quality, the founders of Smartvélo are primarily concerned with sustainability – bikes should last as long as possible. With the purchase of the e-bikes, customers therefore enter into a service contract. “We don’t just produce bicycles, throw them on the market and what happens to them afterwards doesn’t interest us. We take care of everything we develop and build,” says Horn. Depending on the number of kilometers driven by the drivers, the number of bikes per location, specific adjustments for bikes and the service package, customers pay different prices per month. For reasons of competition, the founders do not want to disclose details of the exact amount.
In addition, customers can have existing bicycle fleets serviced by the startup. This is how the 25 Hours Hotel does it, for example. Smartvélo also takes care of the maintenance of the company bicycles for the disposal group Remondis. The city of Cologne hires the start-up for special bike events such as the “Rund um Köln” bike race to check the safety of residents’ bikes.
Don’t be afraid of the delivery service crisis
Different customer groups not only bring variety to the “guys in the workshop”, but also secure the business. Because fast delivery services like that Startup Gorillas acquired by Getir or Flink, which its investors just got from another 200 million financing want to convince are stuck in a crisis. Other providers such as the oriental food courier Father’s had to file for bankruptcy. Horn and Essers believe that they are nevertheless playing on a future market with their startup: “We are in the market for now, so no crisis will pull us down that quickly,” emphasizes Essers.
Her focus is not just on the last mile, but on building a range of bicycles. The 24-year-old finds it plausible and even desirable that suppliers in the delivery segment will disappear after the Corona boom. “That brings more structure again.” In the future, the entrepreneurial duo also want to look at other business areas, such as cargo bikes for transporting children. Smartvélo has already developed a so-called “longtail” cargo bike.
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Both financial and strategic support for the people of Cologne are their investors. For example, Sparhandy founder Wilke Strohman, Sven Oliver Pink, who helped build the school backpack startup Ergobag in 2010, and investor Adrian Hotz in Smartvélo. According to founder Essers, their startup will make “several millions” this year and, according to Horn, could be profitable if they wanted to. The founders are currently planning the next financing steps to drive their growth.
The mid-twenties share the market with providers like the Berlin Startup Cycle, formerly Gethenry, which former Uber executive Luis Orsini-Rosenberg founded in 2019. The difference: Cycle rents its bike fleets for one to three years to delivery services such as Gorillas, Flink and the drug delivery company Mayd instead of selling them. In May 2022, the Berliners collected around 17 million, including at the London VC Local Globe. Smartveló is in contact with the founder, says Horn.