 Hey, welcome back everybody. Jeff Frick here with theCUBE. We're in Reno, Nevada. Inner bike is happening this week in Reno. It's a big, huge bike show. They have stuff up at the mountains. They've got stuff at the convention center. This is a small side of it, put on by Royal Dutch Gazelle bikes. 125 year old bike company that is all in on electric bikes. We came because this e-bike story and part of the big motors, or excuse me, little motors, big battery, kind of last mile thing has really taken off. So we wanted to come get a better feel for what's going on. And we're excited to have a dealer from Portland, one of the most bike friendly towns in all the US. He's Wake Gregg and he runs the e-bike store. Wake Gregg, great to see you. Great, thank you very much. It's great to be here. Thanks for having me. So you said you've had your store open for 10 years. 10 years, we were the first all electric store to open in Portland. Actually it was part of an MBA project. I was in China taking a class, saw electric bikes for the first time, gas had just spiked, and realized these are the most efficient form of motorized transportation known. Right. And nobody was doing it. And so next class I had to write a business plan, launched 10 years ago by putting 25,000 on the credit card and borrowed 10,000 from a friend. And 10 years later, we're still here. Love it, love the story. It's been a fun ride. So it's just, you know, you're the second retailer we've had on and they were also exclusive e-bikes in the Bay Area. So, you know, was the kind of existing bike infrastructure attitude, you know, industry just looking down to these, on these things where they just too weird to knew why, you know, kind of the early ones are e-bikes only. What's interesting, if you come to the market right now, what you see is you see some of the largest companies in the world putting a lot of resources, engineering resources, manufacturing resources, testing resources behind e-bikes. Back in the day it wasn't such. You know, these manufacturers make them and the kind of customer was a test person. Right. And so it's been a very bumpy road to get to this point, but at this point they're very reliable. And so at first when shops were brought these things, they said, why would I ever carry that? Who can keep it running? You know, and now it's at the point where they're very easy to keep running. They have log files, you plug it into the computer, if you have a problem with it and it tells you, oh, error code, fix this one thing and off you're going again. But it hasn't always been such. And so the older bike shops in particular avoided them because you make your money in a bike shop by having a customer for life. And they couldn't keep them running so they were nervous they would not be able to keep the customer. Right. It was wise. You know, now it's at the point where all the IBDs are coming in. In Portland right now we have seven electric only bike shops. All the big IBDs are carrying it. What's IBD? Independent bike dealer. Okay. And on top of that, half the people who are looking for an e-bike will not buy from a traditional bike shop. They'll only come to an e-bike specialist. And so that's kind of our niche is the people and we really focus on that. So we try to have all of our, how we explain things, not to use big bike terms. We talk about how it would value the customer and use a whole different lingo than a traditional bike shop. Right. So there's a lot of different things going on with bikes. So one of them right is the speed and then how it's classified. So, you know, there's the kind of the 20 mile an hour limit and we see that in the scooters and all these electric vehicles that keep it not a motor vehicle. And then they've got one here. I think it was 27 or 28 miles per hour. Yes, class three. Class three. So the laws seem to be kind of trying to catch up. Like how do we classify these things? Are they bikes? Are they allowed on the bike path? Are they not allowed on the bike path? It's funny you bring that up today. Well, it's funny you bring that up today because just today, bike Portland, which is one of the biggest bike blogs in the nation, came out with an article saying they were relatively in the fine print of Portland code, my city's code, and found out you can't ride an e-bike on the city paths in the city parks. And I didn't know this. I haven't been in business 10 years but the very fine print under the interpretation, you can't do it. So it is, it's a gray space. The 28 mile an hour bikes, well it seems crazy fast when you and I are standing here when you're on a road and there's a backup of cars behind you where it's a 20 mile an hour speed limit and they're driving 25. Right. You know, it feels kind of safer to be able to go 25 with them and not hold them up and not be able to get away from the door and zone where the car doesn't go over its door in you by taking the lane, feels much safer. So I actually, I ride a class one most of the time but I do like riding class three bikes. Right. Just curious in terms of the change of experience on an e-bike versus a regular bike, some of the customers that you have, how is it fundamentally different? Because I came here today thinking this is really a last mile play. It's not a last mile play at all. For us, about 35% of our customers, their e-bike is their main mode of transportation. It is their car. It is how they get around. And about 20% historically from our shop have been people with physical disabilities or limitations in some way, shape or form. 20%. 20%. So it's people who can no longer make it up the hill to their house. It's people who can't arrive at work sweaty. It's people with MS, people who are missing a lung. People who have COPD. You name it, these are people who now can ride again and getting them active again. And so it's a whole different mindset. Historically, the bike industry has really gone after kind of the elite athlete. Right. And this is something different. It's people who may haven't ridden a bike for oftentimes 20 plus years. Right. Are now able to get out and go on a hill. And the most interesting thing, they did a study in Australia where they put, they worked with cyclists who have been injured and they hooked them up to exercise bikes in front of a video screen, showing them as they're pedaling down the road, essentially. And they changed the video to climb a hill, but they didn't change the settings on the exercise bike they were sitting on. The cyclists reported a higher level of pain when the visual showed them climbing the hill. So e-bikes do the exact reverse of that. And you're actually rewiring your brain so that bikes don't add pain and you can get where you need to go easily and efficiently. Right. So it's their primary method. So, you talked about the connectivity. An app-integrated experience with all these devices we see over and over. So how has that changed your experience? Is it app for the consumer in terms of keeping track of their miles? Is it just for you and the maintenance? How's the integration of an app working? There are a few different ways of the app. So there's a mechanics app where we can plug it in and see the error codes. And that's important because back in the day, someone would come in and say, I rode this thing at mile 25. It cut out and stopped working. So after work, we would go out and ride 25 miles and try to see if we could recreate the issue. And it was a pain. Now, you just told me it wasn't a pain to ride 25 miles. No, this is back in the day. It was a pain to try to fall. So intermittent issues are the bane of my existence. Oh, yes, yes, yes. But having a log file, we just plug it in and says, oh, it cut out because of this error code. And boom, okay, it replaces the speed sensor. Good, you're back up and rolling. Especially with people who commute, they don't want to leave their bike in the shop. They want it ready within 24 hours or less. And so it's got to be turned. And so it's a whole different form of mechanics and the whole different level of support from the bike dealers. And that's why we choose the bike lines we choose like Gazelle, who support their products very well. So it's pretty interesting, as you said, we talked about the scooter space and OneWheels and all that fun stuff. So many of those companies were started with Kickstarter. It's amazing to me how many kind of Kickstarter projects actually turned into real companies. Boosted, Future Motion being a couple of my favorites. Future Motion, actually, the design behind it was the guy who first invented the self-balancing unicycle, it's Daniel Wood. He's actually from Clackamas, right across the river from Portland. And so I tried his original version of the self-balancing unicycle, which they made their first OneWheels from. And it's come a long way in the OneWheel, but it's been a fascinating progression to watch him. Right. Bring that out to people. But that's very different than 125-year-old Dutch company that's been making these bikes for 100 plus years really is funny. We have, I think there's seven models here that they're showing today. I asked the guys, how many regular bikes models do you have? And they're like one. Yeah. So they're all in. I mean, this is significant. And you think about some of the biggest companies in the world. Market Cap, Bosch is always one of the top five to 10 market companies in the world. They make the largest, the best-selling system in the United States and in Europe. They're behind it. They have millions of lithium batteries in people's homes already through their power tool division. The kind of engineering they're bringing is staggering. And it's been really fun to be part of an industry that has been so nascent. And yet just, boom, overnight, it just comes up in front of you or in front of your eyes. OK, so I got to ask you about the weather. You're from Portland. Yes. Rains a lot in Holland. How does the rain impact these things? Obviously, you just said it's our primary vehicle. Is it more dangerous? Is there more spray? Is it a factor? Is it just not a factor? This is where the lines you carry make a huge difference. So if you buy one off the internet, that hasn't been product tested, you are the product tester. If you buy one like this, they literally have a saltwater steam bath. They put the bikes in for weeks to simulate marine corrosion. They have hydraulic machines that beat the tar out of them. And so when you get a product, it just works. And so we had a Bosch system go completely underwater. Now I'm not saying this is going to happen for everybody's experience. We had a guy literally put the bike in a river. He went one way, the bike went another. Non-purpose. No, non-purpose. It was underwater for a few minutes. Right, right. It worked and rode home. And about a week later, it made some noises. And we told Bosch what happened. It was not a warranty issue. It was a collision. And Bosch said, you know, we haven't had enough warranty claims. We have some extra motors. We're going to send you a new one. And the guy still uses his daily commuter. Right. And it works great. Right. So rain does not affect them. But it really depends on the model you have and how much proctesting and how much engineering has gone in behind it to make sure you have experience. Because lithium and water are not generally friends. No. So just, I give you the last word. When you talk to people that are new to the space, maybe they just stumbled into the store. They heard about these e-bike things. What's kind of the biggest surprise that you see time and time again when people get one of these things and bring it home? Number one is that it rides like a bike. You can just go further. It's how well integrated they are. On average, an e-bike has ridden 75% more than a traditional bike. 75% more. 75% more. On average, you can go about, well, the average speed-wise on it. I just saw a study on this today. You can increase your time by an average cycle is averaging 11 miles an hour. Average e-bike average is about 13 to 14, 15 around there. And I forget the exact number, so I'm giving a bit of gray area there. A little bit faster. Yeah. And so it gets you where you're going faster with less sweat. Right. Well, Wade, thanks for taking a minute. It's a great story. It's a cool story. And Portland, obviously, is leading the charge in this whole transformation. And it's been a fun place to be. And our customers are just awesome. All right. I know two ways about it. Super. Well, thanks again. He's Wade. I'm Jeff. You're watching theCUBE. We're at the Royal Dutch Gazelle Bike-Avanted Interbike. Thanks for watching. Thank you.