How I Started An Innovative Bike Lock Generating Over $1M/Year
Hello! Who are you and what business did you start?
Hello, my name is Michael Shenkerman and I’m the Co-Founder and CEO of Seatylock. I have been in the manufacturing business for the last 20 years and about 7 years ago I co-founded Seatylock. The company is the developer and manufacturer of innovative high-end bike locks.
Seatylock was founded as a platform for innovation. Our first creation was a hybrid product, the first ever product combining a bicycle seat and a lock in one – the Seatylock (not to be confused with the name of the company which is also Seatylock). Since we have continued to develop and manufacture a wide variety of bike locks, from folding locks to U-locks. All of our locks are made only from the highest quality materials, in order to make sure they are not only strong, but also durable.
When I started Seatylock my mission was to create the best bike locks in the world and to bring true innovation into a conservative industry, where innovation is rare and scarce. To achieve this, Seatylock aspires to discover new concepts and ideas in the bike security industry and this is the main reason that we founded Seatylock and this is what we strive to do each day.
Today, Seatylock operates on a global scale and supplies markets throughout the globe with new security solutions for bike riders. Seatylock continues to pursue its passion and do everything possible to ensure bike riders can get wherever they are going while keeping their bikes safe.
We launched our first product, The Foldylock Classic, in 2013 via Kickstarter and managed to raise about $44,000. Next year we launched our Flagship product, the Seatylock, and raised about $137,000 in a campaign that received a lot of media attention and public exposure due to the innovative concept and design of the Seatylock. Since sales have increased steadily from year to year and today are around $120K/month.
What's your backstory and how did you come up with the idea?
Well, this is a long story….
I have been in the manufacturing business for 20 years now and I had a lot of experience with all aspects of manufacturing and logistics in China.
Having a good idea is crucial, but this is just a small part of the big picture, which is execution and how to take that idea and turn it into reality.
I have been working in China for years and I had gained a lot of knowledge about the complex process of manufacturing in China and importing goods from China to other parts of the world.
Because of my experience, many entrepreneurs would contact me and ask for my advice for how to start a business based on production in China. I knew back then that having a good idea is crucial, but this is just a small part of the big picture, which is execution, how to take that idea and turn it into reality.
I was contacted by two young entrepreneurs who had the basic idea for a hybrid product combining a bicycle seat and a lock in one. I loved the idea very much from the get-go, but I also knew that without the right knowhow this great concept will stay an idea and never have the chance to turn into an actual product.
My career and financial situation were quite good as I had my own business manufacturing custom metal parts in various metalworking technologies according to the customer’s needs. Although I had achieved success with my business, I felt a need to do something new and exciting and when the concept of a hybrid bike seat-lock was presented to me I decided to utilize my expertise and turn this lovely idea into reality. That’s how I co-founded Seatylock .
Take us through the process of designing, prototyping, and manufacturing your first product.
The first product we ever designed and planned was the Seatylock.
We started working on it even before we founded a company. The process was long and tedious, and it took us about four years since we started work on it till we had finished working on the Seatylock.
Good planning is everything. The more you are prepared for the unexpected than your chances of finding good solutions dramatically rise.
In retrospect, I can say that we didn’t have enough experience with designing and engineering of this type of product when we took on this challenge. The Seatylock was a very innovative project as it was the first and only of its kind and this made the whole process very complicated.
The Seatylock is a combination of a bike lock, a bike saddle and an adaptor that fits all types of bike seat posts. Just the adaptor itself was complicated enough as there were no other adaptors in the bike market which fit all typea of seat posts. Furthermore, the engineering qualities of a saddle and a lock are in a sense opposite to each other. Saddles are meant to be elegant, comfortable and ergonomic as opposed to locks which are heavy and robust. Our challenge was to find a way to combine these two parts which are opposite by default and on top of that to add an adaptor which was very complicated to design correctly.
It took us about a year to design the initial prototype on the computer and after that almost 3 years of hard work till we managed to manufacture the Seatylock. During this time period we made many mistakes and had to make endless adjustments during the whole process.
Besides the challenges of designing and manufacturing the Seatylock there were many other aspects we had to deal with like the packaging. We tried to be very innovative here also because in the bike accessory market packages for locks are very different than saddle packages.
We had to find an innovative package for the Seatylock that would reflect the innovative nature of the product. The package we came up with allows you to see the saddle from one side and to see the locking mechanism on the other side.
The work process on the Seatylock meant that we had to make adjustments and be agile with our business planning, I’ll give you an example. During the 4 years that we worked on the Seatylock we gained a lot of knowledge on folding locks because the locking mechanism of the Seatylock is based on folding links connected by rivets.
The category of folding locks was quite marginal in the bike lock industry which was heavily dominated by U-locks and chain locks, but during the years we worked on the Seatylock, folding locks gained growing popularity and we knew that even if our work on the Seatylock is still in process we have a chance to come out with our own folding lock, so that’s how we decided to manufacture the Foldylock which was our first product, even before the Seatylock was out.
Describe the process of launching the business.
As I mentioned our first product in the market was the Foldylock Classic and we chose to launch it through Kickstarter because I think that Kickstarter offers a great platform for substantial exposure.
Also, the whole process of the product review is very valuable and helps you be more accurate and professional with how you present your product and how you pitch it. Because we had a positive experience with Kickstarter with the Foldylock we chose to launch the Seatylock on Kickstarter also and we managed to raise about $140,000, but the biggest added value we got from the campaign was the great amount of exposure that the campaign received as the launch video went viral due to the innovative nature of the product.
The Kickstarter campaigns gave us the first boost of customers and after that we launched our website and saw initial online sales through the site and also sales in retail stores.
The financing of the business was mostly from my private capital and due to the complications and duration of the whole process with the Seatylock I needed to invest a lot more than I initially planned for. If I have one piece of advice for entrepreneurs launching their business, I would definitely suggest that they plan their launch in a very thorough manner.
You really need to think about all the details, how to manufacture your product, who needs it, who are you selling to and so on. You must be very precise in the planning and launching phases because there will be plenty of unexpected event during the process and the better you plan for it, the more ready you will be.
Since launch, what has worked to attract and retain customers?
I’ve tried many different channels to attract and retain customers. You must consider the fact that we make bike locks which are very functional. This type of product is not very “sexy”, it’s something that has a lot of practical value, but it’s not the type of product that you would consider as a desirable product. It’s something that people need, but don’t necessarily want.
Moreover, with private customers, the chances that you will have returning customers is very low, or a least the time period till they come back will be very long because once you buy a high-quality bike lock it will usually last for many years. This applies to private customers, but marketing to retailers is very different and you need a separate strategy for that, because you obviously strive to have as many retail clients as possible and you want them to be returning customers.
Seatylock used a few channels for marketing:
Bike industry exhibitions/shows
We have been a regular participant in a few large exhibitions over the years.
These events offer an opportunity to create contacts and business partnerships with so many players in the bike industry that I think we just had to be there. Through participation in exhibitions you get to show your products to hundreds of people in the industry and to set the foundation for future business.
For us these events are crucial because we are coming up against giant companies which have a very strong brand such as Kryptonite and Abus. It’s very hard to be a small company that basically nobody has heard about and you are trying to compete against such established and well-organized companies.
You really need to make an effort to show how your products are better and how they provide more value for money.
Kickstarter
We used the Kickstarter platform to launch most of our products since it’s just a great platform to spread the word out about your product. Kickstarter is also a hub for innovation, so the more innovative your product is the better it will fit this platform.
Email marketing
Email marketing is also very important, and we try to get out a new newsletter about once a month, but you really have to be careful and be aware of the amount of content that you are sending people because today we live in the age of information and spamming.
You don’t want people to get upset with the amount of information you are sending them so today we try to limit email marketing to special promotions or important events and updates. Our newsletters are usually opened by about 25% of subscribers and the conversion rates are low, but I still think that it’s worth the effort.
It's hard to get high conversion rates with our type of product because most people who have bought from us usually don’t need another lock and our products are priced quite high because they are top quality products.
Affiliate programs
Affiliation is a very good way to get more traffic and increase your business. We run an affiliation program and have a growing number of affiliates.
Most of them don’t bring in a lot of traffic, but we do have a few high-quality websites and blogs which bring in sales on a monthly basis and gain nice commission from our partnership.
Amazon
Amazon sales are a big part of our business and we work on an FBA basis. I think that with the power of Amazon today you just must be there.
People put their trust into the Amazon brand and rightfully so because the quality of their service is phenomenal. Many customers on Amazon have visited our website and weren’t comfortable enough to purchase from us (or needed it within 2 days) and left our website to go to Amazon.
They also deal with customer service/shipping so that is less work for our team to handle.
Targeted Facebook ads
I think that Facebook ads can be very tricky and it’s not always worth the money you put in it. You really must target your ads as well as possible and that’s something that we have yet to figure out in a satisfactory manner.
How are you doing today and what does the future look like?
Seatylock is an assembly line-based business. Our products are very innovative in a very traditional and conservative industry which is not associated with innovation. The costs for this type of business are very high and every dollar we make goes back into the company so we can do something new and exciting. We try to come out with new products every year and this requires a great amount of effort and investment.
Mistakes are part of the game… I made a lot of mistakes and I will make many more in the future, but I try not to make the same mistake twice.
Our mission is to create the best bike locks in the world! To achieve this, we aspire to discover new concepts and ideas in the bike security industry. We firmly believe that innovation and thinking outside the box is the key for us to fulfill our mission. This is the main reason that we founded Seatylock and this is what we strive to do each day. We this in mind, we are working on new products that are bike security based but aren’t necessarily bike locks. This will allow us to grow as a company and build our brand as a market leading company with a diverse collection of products.
Currently, we are working on strengthening our sales with retailers and for this we are putting a lot of effort into the wholesale segment and expanding our outreach in bike shops where we are still very far from fulfilling our potential. Working with large distribution companies is also an effective way of expanding our outreach in the retail segment and this is also an important avenue for us to pursue. We have a separate wholesale website for our retail customers but it’s not enough if you really want to sell your products in stores all over the world, because most people still buy their bike looks at a shop and not online.
Through starting the business, have you learned anything particularly helpful or advantageous?
First, you never know where your next opportunity will come from. I get a lot of emails through the contact mail on our website.
Most of these emails are from various companies, distributors or even private people looking for a business partnership. Its hard to stay focused today as you are overwhelmed with the amount of information and the number of emails you have to deal with every day, but you never now what can turn out from all of this and I think that as a small company you have to treat everyone with respect and see if the potential is there, you might be surprised…
Second, mistakes are part of the game…I made a lot of mistakes and I will make many more in the future, but I try not to make the same mistake twice. Learning from mistakes is a major key factor in success and I think you should embrace that. I think that many entrepreneurs are too afraid of making mistakes and that type of fear can restrict you in many cases.
Another important is stock management. We keep stock in 4 different locations around the world and its almost impossible for a small company like Seatylock to maintain full inventory in all locations all year around. Manufacturing and shipment costs are very high and take a while, so you are always going to have problems.
There are good problems and there are bad problems and you should treat inventory issues as the good type. You really need to learn how to be creative and flexible to find good solutions with inventory even if they might hurt sometimes. For example, sometimes we have to absorb high shipping costs that hurt our profits in order to supply orders from overseas warehouses
What platform/tools do you use for your business?
- Sales Platform: Shopify
- Email Marketing: Omnisend
- Online Adds: Facebook
- Affiliation management: Refersion
What have been the most influential books, podcasts, or other resources?
I enjoyed a couple of books especially:
Playing To Win by A.G. Lafley and Roger Martin is a great classic book which shows leaders in any type of organization how to guide everyday actions with larger strategic goals built around the clear, essential elements that determine business success— where to play and how to win. It’s more of a general read that really can help inspire people who are looking to build a long-lasting company and are in it for the long run.
The second book is Good to Great by Jim Collins which is also a true classic. Collins really showed his readers how great companies triumph over time and the book is full of real-life case studies. I think that most books about business management are usually a waste of time, but these two really stand out for me.
Advice for other entrepreneurs who want to get started or are just starting out?
I have 3 important tips for entrepreneurs:
1 - Good planning
Like I mentioned before, good planning is everything. The more you are prepared for the unexpected than your chances of finding good solutions dramatically rise.
Today I can say that if we had planned better with the Seatylock the whole process would have been shorter and much less frustrating.
2 - You need more capital than you think
With finance you really need to have more capital than you initially think. There are so many unexpected events that we can not predict…
You really need to have that extra cushion. So many startups and small businesses fail because they don’t have enough money and not because their ideas and products aren’t good enough, so you really must take this into consideration.
3 - Find the right partners** for your business!**
By right partners, I mean people that bring a substantial added value to the table and people that have the right set of values and moral principles.
I think that if you choose to work with partners, your guiding rule should be to partner only with people that you would like to have as friends and not people that you say to yourself: well I wouldn’t want to be their friend, but I don’t mind doing business with them…
I think that in most cases that would be a recipe for failure.
Are you looking to hire for certain positions right now?
We are not currently hiring out any full-time positions, but this is dynamic and might change any day.
Where can we go to learn more?
- Website: https://seatylock.com/
- Facebook: Seatylock
- Instagram: @Seatylock
If you have any questions or comments, drop a comment below!
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