Kids’ bike subs service ramps up with £16.75 million raise

Having enjoyed early success with its kids’ bike subscription services, The Bike Club, has concluded a £16.75 million fundraise, cash that is to be used to fund expansion into Europe.

The aggressive rollout of the fast-growing business was boosted last year with a £7.5 million debt facility that allowed it to quick ramp up partnerships, including a high street partnership with retail giant John Lewis. The year prior Codex Capital invested £5.7 million in the idea, enabling the firm to become the UK’s largest in private in bike rental.

This cash injection of Series B funding is led by a private equity firm specialising in circular economy businesses, Circularity Capital. This investment firm has a brief of challenging the “take-make-dispose” approach to production and consumption, encouraging the elimination of waste instead, along with existing investor.

Raising £13.25M to date, the bike subscription model is designed to solve for parents the pain of having to buy children new, quality bikes every 12 to 18 months as they grow. Costing between £4.49 to £15.99 per month for hires, currently The Bike Club has a fleet of 40,000 bikes from the likes of Forme, Frog, Squish and IslaBikes. With the new investment, that fleet is on track to climb to 220,000 over the next three years. Subscribers are anticipated to more than double to 80,000 in the next year.

The business now has ambitions to pedal into Germany and France within the next 12 to 24 months.

Bike Club founder and father of three, James Symes, said “The world is moving towards paying monthly, subscription and fractional ownership. We are seeing a lot of household staples and discretionary items move to this model, most cars are now bought on some kind of monthly payment, you pay your mortgage and rent monthly, you have a TV streaming subscription, it makes sense you will pay for kids’ bikes monthly and it’s just not worth owning them in the long run, considering how frequently they need to be exchanged for the next frame size.

“Our research tells us that if you put kids on a quality bike that’s the right size, they’re much more likely to take up and continue cycling throughout their formative years. Bike Club has been created to make the process of upgrading bikes easier and hassle free for parents, whilst giving kids the opportunity to enjoy all the benefits of cycling year-round.”

The kids’ bike subscription service is apparently on track to deliver £5.8m of revenue this year, with a projection of £11m next year, with a current company valuation of £45m. Bike Club’s fastest growing category is First Pedal (age 3–6 yrs) with a 76% increase in 2021 v 2020.