NORCROSS, GA (BRAIN) — Steven Harad is crafting a business plan to bring Blue Competition Cycles back to profitability as its new chief executive officer. Lake Rudd Capital Partners, a private equity firm based in Rhode Island, announced that it acquired the Georgia-based company earlier this week and now have appointed Harad to head it up.
The new owners are ready to invest in the brand to help it grow, said Harad, former brand manager for Kestrel, one of the bike brands owned by Advanced Sports International. Harad also previously owned a multisport shop and was behind the launch of Elite Bicycles, a Philadelphia framebuilder. "The investment group said the resources I need will be available to me—that's the reason I'm here," he said.
Sales at Blue had grown by the double-digits in recent years but its founders and former owners lacked the capital to continue to invest in production. Delivery of bikes slowed over the last year as inventory was tied up at the factories.
The owners put the company on the block and had been actively looking for a buyer for the past nine months, said sales manager Chance Regina who was let go following the buyout. "The previous owners were a small family business and they outgrew their ability to finance and fund it," Regina said. "A year ago we became stagnant. We didn't have the capital we needed.
"It's disappointing but the goal is to make sure the brand survives and is viable for the future and that was accomplished," Regina said about the sale.
Harad now is looking to hire a national sales manager. The rep force and distributor base will remain the same, though he hopes to hire more reps. Mike Giraud will continue as product manager and designer. Giraud was the director of cycling programs at the A2 Wind Tunnel in Charlotte, North Carolina, before joining Blue in June 2011.
Harad worked with Giraud in designing the Kestrel 4000 TT/triathlon bike. "I wouldn't have gone to Blue if he wasn't here," Harad said. "Mike is the asset—my ace in the hole right now to have some really cool product in the pipeline that's so much different across the board."
Harad will work from a home office in Philadelphia, and he hopes to have a second office there eventually. Blue Competition's offices and warehouse will remain in Georgia but soon move into a new, larger building as he anticipates hiring more staff in sales and research and development. Lake Rudd will provide financial resources and business guidance, but will allow Harad to manage the day-to-day, Harad said.
"The product is phenomenal," Harad said. "They needed investment and money to take the company to the next level. There wasn't much inventory flowing for the last year. It's a one-year stumble, one-year hiccup. It will get fixed. We will have 2013 bikes in and 2014 will be the big push."
Michael and Jay Skop founded Blue Competition Cycles in 2004. The company's AC1 aero road bike has earned several accolades in cycling magazines and was named Outside Magazine's "2012 Bike of the Year." The company's bikes have gained in popularity among triathletes as evidenced in the Kona bike rankings, where Blue jumped into the top 20 in recent years. The company claims the number of Kona competitors riding its bikes has tripled since 2010.
