Christini rolls ahead with two-wheel-drive motorcycle

[Jeffrey FRIEDMAN]

Christini rolls ahead with two-wheel-drive motorcycle
Peter Van Allen
Philadelphia Business Journal 

A Philadelphia bicycle maker, hoping to do for bikes what all-wheel
drive did for cars, has found an unexpected market overseas. 

Christini Technologies Inc., maker of two-wheel drive Christini Bikes,
is now in a dozen countries, including Australia, New Zealand, Japan,
Israel and parts of Europe. 

The company, founded in 1999 and profiled in a year-long series in the
Philadelphia Business Journal in 2000, didn't sell its first bicycle
until August 2002. Yet increased demand is expected to propel the
mountain bike maker into the black by midsummer. 

"Right now, we're where a lot of startup companies are -- with a
product on the market. But we started from scratch at the R&D phase,"
said Steve Christini, 32, who founded the company with his brother,
Michael, a patent attorney. 

Christini projects sales of $200,000 for the year just ended, based on
the sale of 200 bikes and miscellaneous parts. For this year, Christini
expects sales to hit $800,000, based on sales of 500 bikes, parts and
bikes sold through a licensing arrangement. 

By the standards of the $6 billion bicycle industry, those numbers may
be peanuts. But Christini Technologies' three models of bikes, which
typically retail for $3,000, are targeted at the hard-core mountain
biker -- someone who will spend big bucks for gear. 

At bike-rating Web site, www.mtbr.com, some reviews of Christini bikes
said the additional technology means additional weight, which can be a
detriment for speed-conscious bike racers. But, overall, riders praised
the bike for its added traction. 

Michael Adcock, a bicyclist from Cardiff, Calif., wrote of a Christini
bike: "The bike felt smooth and responded better than my other mountain
bikes have in the past. The bike tracked incredibly well in the loose
stuff ... I'm still very impressed with this product, so if you want
incredible traction [and] want to be set apart from the rest of the
crowd, then this is the bike for you." 

Bikes are hand-built in Christini Technologies' loft-like industrial
space at 421 N. 7th St. in Philadelphia. The space, which houses both
offices and workshops, is filled with prototypes of both bicycles and
motorcycles driven by both wheels. 

The technology works something like an all-wheel drive car. When the
bike is on flat, dry pavement, most of the power would, like a typical
bike, come from the rear wheel. But on an uphill stretch, or in mud, the
power would shift, with the front wheel applying more drive. Power is
provided by a network of internal driveshafts and gears, something like
the innards of a clock. 

There are no other two-wheel drive bicycles on the market. But the
competition for buyers of high-end bikes is fierce. 

Competitors include Santa Cruz Bicycles, which is based in the
California town of the same name; Ramona, Calif.-based Ellsworth
Bicycles; Tempe, Ariz.-based Titus Cycles; and Klein Bikes of Waterloo,
Wis. 

"Our sales strategy is to find shops that sell those lines," Christini
said. 

In the United States, Christini sells bikes in about 15 shops --
including, locally, Evolution Pro Bike, in Buckingham, Bucks County. It
hopes to be in 30 to 50 shops a year from now. 

It's a niche market: Even Christini's competitors manufacture fewer
than 10,000 bikes a year, he said. But what the bikes lack in volume,
they make up for in price. These are the Ferraris of their class. 

High-end mountain bikes are often customized for individual buyers by
dealers. Prices vary widely, even for the same models, based on the
weight of the bike and quality of components like derailuers, brakes and
shock absorbers. Retail prices for a high-end mountain bike range from
$2,500 to $6,000. 

Perhaps for that reason, the bikes have been a big hit in countries
where outdoor and extreme sports have a widespread following: Down Under
and in countries like Spain, where the Christini bikes were splashed
this fall across two bicycling magazines. 

Separately, it has a licensing arrangement with Daimler Chrysler to
distribute a two-wheel drive bike in Europe under the Jeep name. 

Christini Technologies has gotten this far with the help of angel
investors and grants from Ben Franklin Technology Partners. In the same
way word-of-mouth helps attract customers, it can also draw investors. 

An adviser, Louis Padulo, former CEO of University City Science Center
who was on the Ben Franklin Tech board, introduced the company to David
S. Boyer, former president and CEO of Limerick-based Teleflex Inc., a
maker of cables used in boats, automobiles and aircraft. Boyer became
both a significant investor and valued adviser, coming in two days a
week to discuss manufacturing and business practices, Christini said. 

"It's harder to find investors now, but investors are wiser," he said.


For the future, Christini has been working to apply the same two-wheel
drive technology to motorcycles. A proposed arrangement with ATK USA, a
Centerville, Utah-based maker of motocross motorcycles, fell through a
year ago because Christini Technologies would have had to finance the
venture. Such a startup would cost $10 million, Christini estimated. 

Christini, who has an engineering degree from Villanova University,
spent considerable time in the past two years as a salesman, pitching
the technology to some of the largest motorcycle manufacturers,
including Honda, Yamaha and BMW. Each has shown interest, he said, but
not enough to invest in or buy the technology. 

Christini thinks motorcycles potentially could be an even greater
market, since domestic sales are about 10 times that of bicycles. 

Last year, Yamaha launched its own two-wheel drive motorcycle, based on
its own technology. 

"Yamaha has been in R&D since 1985. We're the only other functioning
[two-wheel drive] motorcycle," said Christini, who spends about half his
time developing the motorcycle prototype. 

Christini is not concerned that Yamaha came out with the technology. In
fact, he thinks it will drive interest from Yamaha's competitors, which
might come back to Christini. 

"It validates everything we've been doing for the last four years,"
said Christini, adding that he's grown used to doubters. "Everyone says,
'If it's such a great idea, how come no one else has done it?'" 

Now they have, and Christini wants to be right there with them. 

"The motorcycle helps the bike," he said. "People will say, 'If it
works this well on the motorcycle, maybe this bike thing isn't so crazy
after all.'" 

http://www.bizjournals.com/philadelphia/stories/2004/01/05/story4.html?t=printable


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