Most entrepreneurs start by identifying an unmet customer need. For Brian Riley, co-founder of Guardian Bikes, the journey started with a tragic event. When Riley was in high school, his grandfather was in a serious biking accident. He braked too hard, which caused him to flip over the handlebars.
The traumatic memory stayed with Riley and sparked his development of SureStop braking technology. At Cal Poly, he designed safety features to prevent similar incidents. His finished system can help young riders safely engage both their front and back brakes using a single brake lever.
“I filed some intellectual property on it and was pretty convinced that I was going to get all the big incumbent players to adopt this technology,” Riley said.
But Riley realized another issue: Most bikes were sold through mass-market channels—like big-box stores—where there was no opportunity to explain directly to consumers how the braking system worked and why it was safer.
“I started to see that the consumer experience for buying bikes felt really broken,” Riley said. “Four or five years in, I did a big pivot in the business and evolved it from being a brake technology component supplier to creating the entire bike.”
This pivot was aided by an appearance on “Shark Tank,” where Guardian Bikes secured investment from Mark Cuban to fund the company’s transition.
To learn more about how we support businesses like Guardian Bikes, connect with a banker.
Switching gears again: The onshoring decision
The move from SureStop technology to Guardian Bikes proved to be lucrative. Sales went up, growing 300% year over year, proving that a direct-to-consumer model was working.
The next big strategic idea: Disrupt the status quo of an overseas original equipment manufacturer (OEM) model and explore if manufacturing in the U.S. was feasible.
“The company’s mission has always been around safety and making the safest kids’ bikes,” Riley said. But when Guardian was limited to design while outsourcing manufacturing, Riley found the company lost control over precisely how those safety features were actually executed.
“When we started Guardian Bikes, we were using the same kind of supply chain model everyone else was using,” Riley said. “But one of the biggest factors of safety is how well bikes are built. We wanted to build a safe, quality product thousands of times over so that every single bike being sold was like it was set up by the best bike shop mechanic.”
Operating from Austin, Texas, Riley and his team began looking into other sites that would allow them to reshore their company’s manufacturing to the U.S. “We had to set up in a location where logistics were really effective, because a bike in a box is a huge product, and we have to deliver that product to thousands of customers’ doors,” Riley said.
Ultimately, they settled on Seymour, Ind., located between Indianapolis and Louisville, Ky., for several reasons. According to Guardian, roughly 75% of the U.S. population can send and receive freight deliveries from Seymour within two days; it has an experienced manufacturing workforce; and it is close to steel mills, which could support new frame-producing capabilities.
The Seymour facility officially opened in 2022, and today the plant employs more than 250 people and produces several thousand bikes each day.
Linking up with J.P. Morgan
While the company was making moves to reshore manufacturing, Guardian also switched its banking to J.P. Morgan in 2021. From early on, Riley felt like it was the right move.
“As soon as we had a relationship with J.P. Morgan, the banking technology was better. The platforms were better. The integrations were better—we started using things like Cashflow 360. Perhaps most importantly, there was also a strong relationship with our banking team, who were always there for questions and checking in with us over the phone or even in person; we hadn’t had that before.”
—Brian Riley, Co-founder and CEO, Guardian Bikes
For Zoë Dobbs, a commercial banker at J.P. Morgan, building a strong relationship with Riley and Guardian Bikes was important both personally and professionally. With three kids of her own, she was passionate about supporting a brand focused on bike safety.
“I was always calling them if they emailed me, because I wanted to dialogue in real-time,” Dobbs said “I wanted to convey to Brian and the Guardian Bikes team that they weren’t competing for my time and attention.”
As Guardian Bikes scaled, Riley felt comfortable coming to his J.P. Morgan team with questions at each stage. “Because of the effort that was made early on to build a relationship and get to know my business, it was a no-brainer to work with J.P. Morgan for the deal,” Riley said.
Recently, the business completed a $19 million financing deal with J.P. Morgan to start building frames at scale in Seymour using cutting-edge automation.
With frame manufacturing expansion ahead, Guardian Bikes is continuing the journey that started with a grandfather’s crash—building safety-focused bicycles while proving American manufacturing can thrive in the modern economy.
Helping midsize businesses grow
With a No. 1 ranking in overall middle market client satisfaction1 and a presence in more than 135 U.S. markets and worldwide, our middle market bankers and specialists deliver proactive, local support combined with global expertise. When you bank with J.P. Morgan, you can gain access to all our resources, from expertise and insights to practical strategies and simple solutions.
Contact a banker to learn more.
References
1.
2023 Coalition Greenwich Excellence Awards
JPMorgan Chase Bank, N.A. Member FDIC. Visit jpmorgan.com/commercial-banking/legal-disclaimer for disclosures and disclaimers related to this content.
