EIB Stark Future

Silas444
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9/18/2024 6:36am Edited Date/Time 9/18/2024 6:55am

I find it fascinating, how pessimistic certain people on here are when they perceive Stark as not being profitable enough while they're scaling up and developing new bikes.

I mean, just out of curiosity, what are your thoughts on Pierer Mobility Group and the strategy they've been deploying? Do you think it's better to do as they have done? To attempt corporate growth by just buying someone else's struggling company (Husaberg, GasGas, Husky, MV Augusta) and spend all your capital trying to unload their existing assets and hope the leftover namesake cred is enough incentive to sell copycat bikes and turn yourself into a hoped-for global behemoth? Or - OR - do you think it would have been wiser for PMG to do as Stark is doing and spend its capital focused not on creating new brands but on creating new products?

It's tough out there either way - God knows - but I prefer Stak's vision over Pierer's Mobility Group's vision - because all PMG is really "building" is a lollypop-colored mirage, and their cliff-diving stock price numbers speak to that.

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byke
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9/18/2024 9:25am

New products over new brands, especially in KTM's case, because why spend millions to have a slight variation of the same thing you already make, but....where are those new products? 

Time is the enemy here for a popup-business-just-add-100M. The way this normally works is to inch two categories up alternately, revenue and expenses, and you get small loans to cover the time gaps where expenses increase from development, then you keep working until that debt is under control from the increase in revenue that came from your development, and that revenue is what informs you on how well you did with development and that provides you with a ton of firsthand market knowledge of your product. You have to earn that knowledge through blood sweat and tears and years, in order to become good enough to survive on your own for the long haul, because that's actually super hard to do. 

And ideally you work these inching movements while riding consumer economic cycles. But, when you blow up and instantly have huge debt, huge expenses, and not enough revenue to more than cover it, time will gut you like a fish. You can go from being a baller swooning suppliers with fancy meals and hotels to literally becoming a thief and stealing your company's products and storing piles of it in your garage in a few months. 

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38special
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9/18/2024 11:16am

Early in the Stark's announcement cycle, there was talk by the British MX Championship of being "All Electric" by 2025, and having tracks in green spaces near urban areas.  2025 is almost here.  😆

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7eleven
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9/18/2024 12:25pm

Vargs are on sale worldwide this month. There's no better time on pricing. Also, if you own a Varg and you let someone ride it, you simply log the referral in your Stark phone app. If that guy buys a Varg, you receive $300 parts credit and he scores a free set of titanium pegs. 
Who wants to ride my Varg? 

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1

The Shop

Silas444
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9/18/2024 6:06pm
byke wrote:
New products over new brands, especially in KTM's case, because why spend millions to have a slight variation of the same thing you already make, but....where...

New products over new brands, especially in KTM's case, because why spend millions to have a slight variation of the same thing you already make, but....where are those new products? 

Time is the enemy here for a popup-business-just-add-100M. The way this normally works is to inch two categories up alternately, revenue and expenses, and you get small loans to cover the time gaps where expenses increase from development, then you keep working until that debt is under control from the increase in revenue that came from your development, and that revenue is what informs you on how well you did with development and that provides you with a ton of firsthand market knowledge of your product. You have to earn that knowledge through blood sweat and tears and years, in order to become good enough to survive on your own for the long haul, because that's actually super hard to do. 

And ideally you work these inching movements while riding consumer economic cycles. But, when you blow up and instantly have huge debt, huge expenses, and not enough revenue to more than cover it, time will gut you like a fish. You can go from being a baller swooning suppliers with fancy meals and hotels to literally becoming a thief and stealing your company's products and storing piles of it in your garage in a few months. 

I certainly don't disagree with anything you've said, you sound like you've actually lived these things you're commenting about, but let me ask you this: what's more important, releasing a less-than-great product on a timeline that's acceptable to historical marketplace trends, or being late to the party with a product that exceeds your potential customer's expectations?

My point in asking that question is simple: I think Stark is developing a smaller bike to compliment the Varg, a 19/16 wheel-size bike that can be programmed from something resembling a "playbike" right up to a full-on SuperMini race bike. A bike like this would in effect be the "Missing Link" of motocross, as every single member of a racing household could find a passionate use for it. I could easily be wrong, but if I'm not, it would explain both Stark's tardiness in releasing their second bike and their bank's willingness to lend them money based on what their prototypes demonstrate.  

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byke
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9/18/2024 6:33pm
byke wrote:
New products over new brands, especially in KTM's case, because why spend millions to have a slight variation of the same thing you already make, but....where...

New products over new brands, especially in KTM's case, because why spend millions to have a slight variation of the same thing you already make, but....where are those new products? 

Time is the enemy here for a popup-business-just-add-100M. The way this normally works is to inch two categories up alternately, revenue and expenses, and you get small loans to cover the time gaps where expenses increase from development, then you keep working until that debt is under control from the increase in revenue that came from your development, and that revenue is what informs you on how well you did with development and that provides you with a ton of firsthand market knowledge of your product. You have to earn that knowledge through blood sweat and tears and years, in order to become good enough to survive on your own for the long haul, because that's actually super hard to do. 

And ideally you work these inching movements while riding consumer economic cycles. But, when you blow up and instantly have huge debt, huge expenses, and not enough revenue to more than cover it, time will gut you like a fish. You can go from being a baller swooning suppliers with fancy meals and hotels to literally becoming a thief and stealing your company's products and storing piles of it in your garage in a few months. 

Silas444 wrote:
I certainly don't disagree with anything you've said, you sound like you've actually lived these things you're commenting about, but let me ask you this: what's...

I certainly don't disagree with anything you've said, you sound like you've actually lived these things you're commenting about, but let me ask you this: what's more important, releasing a less-than-great product on a timeline that's acceptable to historical marketplace trends, or being late to the party with a product that exceeds your potential customer's expectations?

My point in asking that question is simple: I think Stark is developing a smaller bike to compliment the Varg, a 19/16 wheel-size bike that can be programmed from something resembling a "playbike" right up to a full-on SuperMini race bike. A bike like this would in effect be the "Missing Link" of motocross, as every single member of a racing household could find a passionate use for it. I could easily be wrong, but if I'm not, it would explain both Stark's tardiness in releasing their second bike and their bank's willingness to lend them money based on what their prototypes demonstrate.  

My main concern has to do with the size of the business relative to the product/s at hand, like you'd never kick off a 10 billion dollar company making footpegs for 1978 YZ250's, just not gonna happen and anyone that thinks they can make those numbers work, is out of touch with reality. To your question and from previously working in a super niche tech field, I've seen what happens when you go to market too early. It ended in tears and lawsuits, which to be fair ultimately worked out really well after some dark times, but it's hard to answer. 

My comments don't come from a place of thinking the Stark Varg isn't good enough. I thought the Alta was good enough and the Stark is way better. My point is that it doesn't matter how amazing your 1978 YZ250 footpegs are, they'll never support much more than a garage sized business with no overhead. Stark's business model needs some big reveal well beyond a play bike if they're going to be around in ten years. They could totally do it, but the plans that we've seen to date are worrisome. When you get too big, you can't just shut down the mill and go inside the house and basically turn your overhead to zero in slow times. 

At least they're not in the SF Bay area where even the shipping guy was making six figures. Pre-Covid income btw. 

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Silas444
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9/18/2024 6:54pm
byke wrote:
My main concern has to do with the size of the business relative to the product/s at hand, like you'd never kick off a 10 billion...

My main concern has to do with the size of the business relative to the product/s at hand, like you'd never kick off a 10 billion dollar company making footpegs for 1978 YZ250's, just not gonna happen and anyone that thinks they can make those numbers work, is out of touch with reality. To your question and from previously working in a super niche tech field, I've seen what happens when you go to market too early. It ended in tears and lawsuits, which to be fair ultimately worked out really well after some dark times, but it's hard to answer. 

My comments don't come from a place of thinking the Stark Varg isn't good enough. I thought the Alta was good enough and the Stark is way better. My point is that it doesn't matter how amazing your 1978 YZ250 footpegs are, they'll never support much more than a garage sized business with no overhead. Stark's business model needs some big reveal well beyond a play bike if they're going to be around in ten years. They could totally do it, but the plans that we've seen to date are worrisome. When you get too big, you can't just shut down the mill and go inside the house and basically turn your overhead to zero in slow times. 

At least they're not in the SF Bay area where even the shipping guy was making six figures. Pre-Covid income btw. 

The shipping guy was making 100K? Good Lord. No wonder they went under.

I appreciate both your candor and your knowledge. I'm learning things I didn't know, a rare thing sometimes on this site. I guess the one thing I might argue is that neither one of us really knows the potential buying audience for the bike I mentioned. It could be huge, at least by motocross industry standards. Maybe that still wouldn't mean anything in the land of "Real World Numbers" where you dwell. I don't live there anymore and it's a long time since I left. There's more foxes and bears than people where I live now, so my understanding of what it takes to make it in the world of big-city-business has become, to say the very least, challenged.

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fourfourone
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9/19/2024 10:47am

Kaplan cycles here in CT posted the alpha for 10,900 out the door. 

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Dirtysmile56
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9/19/2024 11:49am

I noticed new Vargs advertised in Oregon for $10,900 OTD . Weren't they $13k if you pre ordered and waited 2 years? 

1
byke
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9/19/2024 1:40pm

Lithium was selling the standard 60hp version for $9.990 until stock ran out. 

9/19/2024 2:05pm Edited Date/Time 9/19/2024 2:10pm

Unless their website doesn't update the stock levels it looks like they have some 80HP models .  I saw other shops advertising at the same price too.  And customer of mine ordered one from a local shop and is getting it at the $10K price.         They say that  " Few units remaining in inventory, once sold there may be a week delay in getting new units shipped! " They have the 80HP for $10,990.00  in all 3 colors listed on their website stillimage 479.png?VersionId=PsGKimage 481

MxAddic
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9/19/2024 5:25pm

Ha, Ha, the old Anton screw. With the 50 mil loan he just got from the EU he can afford to give them away and still keep pumping them out.

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Larry450
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9/19/2024 8:10pm

MY24s are on sale. I think MY25s will be out soon. 

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Beagle
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9/19/2024 9:47pm

Update: VIN now over 8200 at US dealers.

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rjg
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9/20/2024 12:52am Edited Date/Time 9/20/2024 12:52am

The problem is still run time and turn around time. They have their place but still not satisfactory for the majority. I want one but trust is low. The same demo model with 0 sold at my local dealership 1.5 years now. I bet Alta has more total sales.

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Beagle
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9/20/2024 1:35am
rjg wrote:
The problem is still run time and turn around time. They have their place but still not satisfactory for the majority. I want one but trust...

The problem is still run time and turn around time. They have their place but still not satisfactory for the majority. I want one but trust is low. The same demo model with 0 sold at my local dealership 1.5 years now. I bet Alta has more total sales.

For sure they're not there for the majority, and I bet some dealers are struggling.

But Stark operation is definitely on another scale compared to Alta.

Alta sold about 1000 bikes total (for all models, all years, so in about 3 years). Stark delivered about 3000 bikes in 6 months in 2023, they have over 350 dealers all around the world, have already built about 10 times more bikes than Alta ever did and they don't have a road-homologated bike yet.

There are some very clear technical limitations to electrics, for some it makes sense and for others definitely not, to each their own. You can also enjoy both electric and ICE by the way 😎

In the end there are quite a number of riders which are having fun with this bike which is all that matters really.

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MxAddic
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9/20/2024 1:47am
Beagle wrote:
For sure they're not there for the majority, and I bet some dealers are struggling.But Stark operation is definitely on another scale compared to Alta.Alta sold...

For sure they're not there for the majority, and I bet some dealers are struggling.

But Stark operation is definitely on another scale compared to Alta.

Alta sold about 1000 bikes total (for all models, all years, so in about 3 years). Stark delivered about 3000 bikes in 6 months in 2023, they have over 350 dealers all around the world, have already built about 10 times more bikes than Alta ever did and they don't have a road-homologated bike yet.

There are some very clear technical limitations to electrics, for some it makes sense and for others definitely not, to each their own. You can also enjoy both electric and ICE by the way 😎

In the end there are quite a number of riders which are having fun with this bike which is all that matters really.

If you enjoy having your resale tank like the Titanic MPTY. Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors. Keep cranking them out Anton. I already know how this story ends.

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MxAddic
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9/20/2024 5:17am
Larry450 wrote:

MY24s are on sale. I think MY25s will be out soon. 

I was told there is no model year '25.

2
7eleven
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9/20/2024 6:00am

I was at a Stark Varg demo night last night in Oklahoma at OMC motocross track. Ajax Motorsport rented the track and let everyone ride for free. Those demo Vargs ran all night. 

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9/20/2024 6:13am
Beagle wrote:
For sure they're not there for the majority, and I bet some dealers are struggling.But Stark operation is definitely on another scale compared to Alta.Alta sold...

For sure they're not there for the majority, and I bet some dealers are struggling.

But Stark operation is definitely on another scale compared to Alta.

Alta sold about 1000 bikes total (for all models, all years, so in about 3 years). Stark delivered about 3000 bikes in 6 months in 2023, they have over 350 dealers all around the world, have already built about 10 times more bikes than Alta ever did and they don't have a road-homologated bike yet.

There are some very clear technical limitations to electrics, for some it makes sense and for others definitely not, to each their own. You can also enjoy both electric and ICE by the way 😎

In the end there are quite a number of riders which are having fun with this bike which is all that matters really.

MxAddic wrote:
If you enjoy having your resale tank like the Titanic MPTY. Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer...

If you enjoy having your resale tank like the Titanic MPTY. Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors. Keep cranking them out Anton. I already know how this story ends.

"Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors."

You must be talking about KTM!

image 474.png?VersionId=5ggYO8ZrJCEM2pkyZ3kRQngbnLV4
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MxAddic
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9/20/2024 6:34am
"Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors."You must be talking about KTM!

"Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors."

You must be talking about KTM!

image 474.png?VersionId=5ggYO8ZrJCEM2pkyZ3kRQngbnLV4

I think the folks that like to claim I am unjustly critical of Stark and ridicule me because of it will find in the KTM thread I called them out for similar issues. Imagine that...

I guess things will work out better for Stark than it is for KTM after they build out their product line?

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9/20/2024 6:41am
"Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors."You must be talking about KTM!

"Somebody is paying interest on the thousands of bikes setting in warehouses and on dealer floors."

You must be talking about KTM!

image 474.png?VersionId=5ggYO8ZrJCEM2pkyZ3kRQngbnLV4
MxAddic wrote:
I think the folks that like to claim I am unjustly critical of Stark and ridicule me because of it will find in the KTM thread...

I think the folks that like to claim I am unjustly critical of Stark and ridicule me because of it will find in the KTM thread I called them out for similar issues. Imagine that...

I guess things will work out better for Stark than it is for KTM after they build out their product line?

Maybe, maybe not, only time will tell.

New companies and old companies can fail, or succeed.

Rocketship
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9/20/2024 6:50am
MxAddic wrote:
Ha, Ha, the old Anton screw. With the 50 mil loan he just got from the EU he can afford to give them away and still...

Ha, Ha, the old Anton screw. With the 50 mil loan he just got from the EU he can afford to give them away and still keep pumping them out.

Well they deserve each other and are a match made in heaven as they are both unrealistic in their ambitions. 

Bikes sit on the showroom floor and net selling, at all. Same goes for road motorcycles, mopeds. Livewire, Zero, BMW have all the same issues, their electric bikes don’t sell because the masses don’t want it and don’t believe in it while the ICE bikes are selling like hot pockets.

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MxAddic
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9/20/2024 6:56am
Rocketship wrote:
Well they deserve each other and are a match made in heaven as they are both unrealistic in their ambitions. Bikes sit on the showroom floor and...

Well they deserve each other and are a match made in heaven as they are both unrealistic in their ambitions. 

Bikes sit on the showroom floor and net selling, at all. Same goes for road motorcycles, mopeds. Livewire, Zero, BMW have all the same issues, their electric bikes don’t sell because the masses don’t want it and don’t believe in it while the ICE bikes are selling like hot pockets.

Same over here. They just print money and pour it into a black hole. You taxes will cover the losses and then some.

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Rosso391
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9/20/2024 6:56am Edited Date/Time 9/20/2024 1:34pm

So let me get this straight. Stark has sold 8000+ bikes @ $13k each without fees and shipping? So they have a total income of $104M from bike sales. And they JUST finally made a $10M profit in July? EDIT: I read it wrong. They didn't profit $10M in July.. They sold $10M in sales. So I'm sure they're still not making money.

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9/20/2024 7:20am
rjg wrote:
The problem is still run time and turn around time. They have their place but still not satisfactory for the majority. I want one but trust...

The problem is still run time and turn around time. They have their place but still not satisfactory for the majority. I want one but trust is low. The same demo model with 0 sold at my local dealership 1.5 years now. I bet Alta has more total sales.

You and MXaddic would enjoy each other's company.

7eleven
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9/20/2024 7:20am
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Beagle
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9/20/2024 7:50am Edited Date/Time 9/20/2024 7:58am
Beagle wrote:

Oh, well, looking forward to an enriching, thoughtful and well-argued discussion on Stark finances 🤣

Thank you nrosso, you delivered in style.

chefs-kiss-french-chef
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