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I see any investor needing lower costs, better volume capacity, and a continual stream of improvements.
I would get out of Cali 1st, and that means a new HQ. I'd also need to double the production capacity at minimum. The improvements may be the easiest part, since the owners forum has already identified items in need of attention.
I'd suggest the important propietary "secrets" are the frame, the battery casing, motor and gearbox and the controllers. The rest is bolt on stuff. The advantage is the ability to move quickly into a HOT market without years of development time to a platform that has an immense buzz about it. Keeping the ball rolling allows the speed to market that will allow a buyer to capture not only the early adopters but the multitude of riders that intended to go with Alta on their next purchase after the incredible demo tour and testimonials from real owners.
What is it worth? That must be the question. What are the patents? Imagine this company on Shark Tank, would they would ever get a Shark? If someone took the company public, it might generate enough buzz that it could float stock prices even though it will take years to actually show a profit. I think that is the most likely solution.
If you sold 2000 units a year at $2500 gross profit, That's 5 million. Overhead, marketing and non production payroll will eat up a lot of that. This thing will not be a money machine out of the box, it will take a longer view to grow it, and after a few years the competition will likely catch up and be fierce.
Demo tours and dealer development teams, race programs, press launches, are expensive to establish a brand, and it's a shame that the hard part was done and apparently the production couldn't keep up with the orders. I'd assume that with the HD $ and the investors like Bob Fox, they believed there was enough cash to do it all, and somehow HD backed out and when it came time to pay suppliers for additional inventories like batteries, there just wasn't enough left?
Alta has already consumed over $43,000,000 and wasn’t profitable after 8 years.....
After 8 years and $43mil, investors weren’t buying the pitch anymore.
https://www.crunchbase.com/organization/brd-motorcycles
Unfortunately, as a performance minded team, they went the route of Cannondale and aimed for the summit with their first product.
Reworking and reworking and reworking a product to get it perfect is not a recipe for profitability.
The web-site is still up.
The intellectual property/designs/vendor lists could be held/taken by the “owning investors”, new investors or anyone that wants to buy/buy out the current company & production could resume without any true loss of availability (model year-wise the ‘19s are ready to go).
From what I’m seeing and hearing Alta can and probably will be “resurected”.
Big difference with Cannondale, Alta didn't make the worst bike ever, but one of the best. No doubt MX is the summit, and requires constant improvement, but that is not so different than any company making widgets.
The Shop
DeCal Works Huge Plastic Inventory of UFO and Polisport kits.
Luxon 4-Post Bar Mounts
$189.95 - $239.95
The past often predicts the future.
Any investor will look at all the facts, ie: the past.
And use that info to predict future risk, profitability, etc
The metric shit ton of money in the past that vaporized getting to this point will run everyone off.
It ran HD off...
They were losing over $55,000 per day
That little nugget of the past will be impossible to ignore, because, you know, it's in the past.
And that's not counting creditors
Jeez, what a bummer. Sounds like Buell revisited. Take a look at what happened there.
http://badweatherbikers.com/cgibin/discus/discus.cgi
Alta was already dying from money hemorrhaging when they arrived.
Before HD gave Alta money, they came in and did their due diligence.
Assets, liabilities, accounting, forecasts, operations, future products, production, issues, etc.
HD wasn't given every Alta secret until the due diligence was completed.
What HD saw via their due diligence told them to run, so they exercised their out clause and left.
Also the company burn d tremendous amounts of cash to ever be successful.
Combustion engines are the foreseeable future of motorcycles electric is a expensive unsubstanible choice in the foreseeable future.
And the numbers they were talking about blew me away i never would have imagined the kinda money they use. The podcast was talking about Angel investors and how much startup money they give them they call it seed money.
And since its seed money its be given before they know if its going to be successful, and the people on the podcast said the usual amount given by this specific angel investor was $250,000,000 to $500,000,000
And that is before they know if its gonna be successful
Thats crazy to me, all i could think is How much do the people doing the investing have if they can give that , and give it over and over , hoping to hit on the next Facebook or Instagram.
And I haven't double-checked the stats posted, but if all they spent was $43m over 8 years, and built what seems to be the best dirt bike ever IMO, that's amazing, not shameful.
I work for a startup that's burned through about the same amount in the same amount of time, and we're just building software and just starting to think about how to become profitable—hardware is much more costly and difficult. Look at what Telsa has spent to get where they are.
I don't agree.
Eric ruined his dream. He had it all, but just could not rein in his engineer/innovation mind and actually build a bike that would sell enough to make a profit.
He did it at first with building bikes by himself.
He did it again with HD.
He did it again with Hero.
He did it again with the liquidator that bought the Hero stuff when they canned him.
If he would have just toned the innovation stuff down a bit, concentrated on making those that were financing it all some money, things might have turned out a bit different,
For sure plenty of investors will get in early for huge amounts to seed, hoping to be in early on the next big thing.
It’s what they do.
Alta consumed $27,000,000 since their B round, June ‘17.
That’s pretty ugly.
The numbers are known.
I’m not bashing the company or bike, I came VERY close to buying one in Jan.
Only reason I held out was I wanted a ‘18 CRF450 also, and don’t ride MX enough to justify two new bikes at the same time.
It sucks they’re gone.
Looking back, too bad they didn’t build a scooter/Ruckus product first that used less development but could’ve moved them to profitability, or a mini.......but who knows.
I disagree, HD bouncing is because of a problem at Alta....a monthly burn rate of over +$1.6 million is not in the universe that a niche motorcycle manufacturer belongs.
There’s no horizon on invested money coming back.
Early, some gamble investing, but 8 years in and burning over $1.6 million a month is investment suicide.
The bike is fantastic, the best bike i have ridden (and owned) to date. It turns better than any bike i've ever ridden, it has more torque than any other bike, its silent (so my ears don't get nearly as much damage), there's basically no maintenance, i can ride close to homes and it doesn't bother anyone (which means i get to ride more often), it runs exactly the same if i'm at 6000 ft and sea level, it runs exactly the same at 55*F as it does at 105*F, i cant stall it, i dont have to worry about being in the wrong gear, no clutch to pull, the ergonomics are perfect, you can run a left hand rear brake to make even better use of the rear brake ..... and it's 4 bikes in 1. I can let newbies ride around in Map 1 which has the power of a 150F, and they can creep up in power as they are comfortable... up to a 250f in map 2, a modded 250F in map 3, and a 450 in Map 4. It can creep up my ramp into my pickup bed literally without needing me to push it.
I had 2 old timer vet guys try the bike today at Cahuilla. They both got off the bike dragging their jaws in the dirt. They couldn't believe how good the bike is. "This is the ultimate social security bike" and such. These are guys that have been riding for 30-40 years.
Has anyone actually ridden one and still thought negative about electric bikes?
Pit Row
I also seriously wonder how much ip that give a longterm advantage these guys have. I would expect the battery improvements will be driven by r&d in other markets.
I like shifting I like riding for hours without recharging.
I don’t like the cost of electric bikes.
They are going to have parts availablity problems.
If you like them that’s swell but we all don’t have to agree to like them just because you do.
Their decision to close up overnight left a lot of their vendors with large balances owed to them, bad deal. They ordered/received product right up until the last day, no regard for others apparently.
Appears it's officially game over...
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