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PostPosted: Tue Aug 08, 2017 8:04 am 
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waltthizzney wrote:
More reason to buy/invest in Q36.5 gear


dont understand the logic...... because Rapha has raised money to invest, you should no longer buy products from them?


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PostPosted: Tue Aug 08, 2017 10:36 am 
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fa63 wrote:
Apparently, RZC also owns a piece of Allied Cycle Works, the Arkansas based frame maker who bought Guru's tooling/machines when they went out of business.

Maybe soon we can buy a custom carbon frame and Rapha clothing at Walmart?


Seriously, these two guys are young and obviously cyclists. More power to them investing their fortune in a sector they have a passion for. Staking your money in US based carbon development and manufacturing is a huge risk.


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Posted: Tue Aug 08, 2017 10:36 am 


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PostPosted: Tue Aug 08, 2017 3:51 pm 
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The multiple RZC is paying for Rapha certainly is mind-boggling...

But then so is Dorel paying a 1x multiple for Cannondale if those figures are true: a $200m price for a company with $200m revenues values the company as basically a professional services/non-product company, with no value in its products, technologies, R&D, brand, patents or anything.

Then again, we are talking about Cannondale.... the company that contributed Press-Fit BB's to the world.

On 2nd thoughts... 1x was too much! :-)


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PostPosted: Wed Aug 09, 2017 3:19 pm 
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Digger90 wrote:
The multiple RZC is paying for Rapha certainly is mind-boggling...

But then so is Dorel paying a 1x multiple for Cannondale if those figures are true: a $200m price for a company with $200m revenues values the company as basically a professional services/non-product company, with no value in its products, technologies, R&D, brand, patents or anything.

Then again, we are talking about Cannondale.... the company that contributed Press-Fit BB's to the world.

On 2nd thoughts... 1x was too much! :-)

This is great, so revenue multiples have replaced earnings multiples and NPAT is now EBITDA? Keep this thread going please!

From what I heard there were several PE firms offering valuations in the £200m range, there's a range of qualitative and quantitative factors that lead to a valuation and very hard to ascertain from a couple of headline numbers. Profit is less relevant in the context of a private company in its growth phase- for Waffa it's going to be about drawing more members into their system (clubhouses/ events/ experiences/ product lines etc). I wouldn't be surprised if they sponsor another pro team as well.


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PostPosted: Wed Aug 09, 2017 4:17 pm 
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Digger90 wrote:
The multiple RZC is paying for Rapha certainly is mind-boggling...

But then so is Dorel paying a 1x multiple for Cannondale if those figures are true: a $200m price for a company with $200m revenues values the company as basically a professional services/non-product company, with no value in its products, technologies, R&D, brand, patents or anything.

Then again, we are talking about Cannondale.... the company that contributed Press-Fit BB's to the world.

On 2nd thoughts... 1x was too much! :-)


The figures are true. Cannondale had $200 million in sales in 2007 and were purchased for $200 million by Dorel in 2008.


http://www.bikingbis.com/2008/02/04/mak ... e-company/

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PostPosted: Wed Aug 09, 2017 5:41 pm 
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Posts: 338
Location: Seattle, WA
GonaSovereign wrote:
That's a sh*tload of money for Rapha. They're a good marketing company, but do they have any IP? (I'm a fan and like the Proteam line, and as a marketer appreciate the solid brand building they've done. They are a marketing company, after all. Assos is a product company. Castelli is both.)


They certainly put loads into their marketing but personally it's never done anything for me and I recently have been drawn to going back to them based on product functionality alone (and yes I do recognize that most of their success is from drones with a lot of disposable income that are drawn into the cool/hip factor + (former) team sky association they bring). The cut and material on this year's short sleeve aero jersey (small) is absolutely perfect for me. No sag or wasted material at all without being uncomfortable and the sleeves are coolishly long. I've been trying other brands because my bibs are wearing out and hate the fred factor associated with the brand and figured I might as well get a matching jersey to go along with the replacement but everything else seems to fit like a tent, are too short in the sleeves, and have obnoxious or ugly color/pattern/logo design (yes, including assos/castelli) :x

I begrudgingly decided to go with ORNOT who have a couple of nice jersey designs but again, fit like a tent and have too short sleeves at size small and extra small is way too short torso+sleeves. If it wasn't for the eye-roll stigma associated with Rapha, I'd probably happily wear the few products of theirs I actually like year-in-year-out, especially when they dump their entire range for sale at the end of summer every year.

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PostPosted: Thu Aug 10, 2017 12:11 pm 
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53x12 wrote:
The figures are true. Cannondale had $200 million in sales in 2007 and were purchased for $200 million by Dorel in 2008.

http://www.bikingbis.com/2008/02/04/mak ... e-company/


Cannondale wasn't in great shape financially at the time of the sale which I suspect might have had something to do with that price.

Anyone know what Cervelo was sold to Derby for? It was apparently it pretty dire financial straits when it was sold and basically insolvent and in the Canadian equiv. of Chapt. 11.


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PostPosted: Thu Aug 10, 2017 1:48 pm 
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silvalis wrote:
Is 260m that mind boggling? They reported 63m gbp revenue last fy. Not sure what their profit was though.

In 2014 they reported £40M turnover and £500k profit. Pre-tax.
In 2015 they reported £50M turnover and £1.1M profit. Again pre-tax.

Granted this is swayed by their investment in expanding the business and building RCC outlets but it's a tiny profit compared to the investment!


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PostPosted: Thu Aug 10, 2017 3:38 pm 
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maquisard wrote:
53x12 wrote:
The figures are true. Cannondale had $200 million in sales in 2007 and were purchased for $200 million by Dorel in 2008.

http://www.bikingbis.com/2008/02/04/mak ... e-company/


Cannondale wasn't in great shape financially at the time of the sale which I suspect might have had something to do with that price.

Anyone know what Cervelo was sold to Derby for? It was apparently it pretty dire financial straits when it was sold and basically insolvent and in the Canadian equiv. of Chapt. 11.


You are correct, that Cannondale was dealing with the fiasco from their failed motorcycle attempt. Still, a $1.4 million profit on $62 million in sales for 2016 is nothing to be proud of. The small company I work for did $55 million in sales last year with a profit of $12 million. This was even with expansion of the company and putting money into future growth and development.

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PostPosted: Thu Aug 10, 2017 4:10 pm 
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This is the biggest issue of Korean cycling scene this week.


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PostPosted: Thu Aug 10, 2017 5:00 pm 
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Posts: 4423
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Wookski wrote:
Digger90 wrote:
The multiple RZC is paying for Rapha certainly is mind-boggling...

But then so is Dorel paying a 1x multiple for Cannondale if those figures are true: a $200m price for a company with $200m revenues values the company as basically a professional services/non-product company, with no value in its products, technologies, R&D, brand, patents or anything.

Then again, we are talking about Cannondale.... the company that contributed Press-Fit BB's to the world.

On 2nd thoughts... 1x was too much! :-)

This is great, so revenue multiples have replaced earnings multiples and NPAT is now EBITDA? Keep this thread going please!

From what I heard there were several PE firms offering valuations in the £200m range, there's a range of qualitative and quantitative factors that lead to a valuation and very hard to ascertain from a couple of headline numbers. Profit is less relevant in the context of a private company in its growth phase- for Waffa it's going to be about drawing more members into their system (clubhouses/ events/ experiences/ product lines etc). I wouldn't be surprised if they sponsor another pro team as well.


Very true, and the declared profit number no doubt doesn't tell the full story ...

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PostPosted: Thu Aug 10, 2017 5:15 pm 
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Location: France
Indeed impossible to draw conclusions without more information.

I worked for a company that wasn't that profitable due to a large opex. on R&D that was being invested in future success. Similarly I have worked for a company that cut-back on R&D to hide the fact that the opex. was so high due to the company being badly run. The latter was more profitable in the short term though circling the plughole in the long term. Five years on the former still exists, the latter doesn't and had to be absorbed into another company to survive.


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PostPosted: Fri Aug 11, 2017 4:33 am 
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I don't think the reported figures are quite correct.

What I understand is with such deals is that, its usually " Bought a majority stake in XXX Company that values it at $ZZZ"
Not a case of paying $200m for a majority stake in Rapha.

It would make the valuation a whole lot more sensible if that were the case.


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PostPosted: Fri Aug 11, 2017 5:51 am 
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Profit is meaningless in a growth stage company. How long did it take Amazon to turn a profit?

Counter point though: how big of a market is Gucci cycling wear?

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Posted: Fri Aug 11, 2017 5:51 am 


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