"We need a people's e-bike"

Sven Schneider and André Thiele have jumped onto a growth market with Smafo. The start-up produces and sells its own e-bike and also offers leasing and subscription models.

The fact that the e-bike market is booming is almost an understatement. In 2020, 43.3 percent more e-bikes were sold than in 2019, as the German Bicycle Industry Association (ZIV) proudly announced in March. Smafo founders Sven Schneider and André Thiele also wanted to get in on the action and founded their start-up in 2018. Today - on Bicycle Day - founder Sven Schneider talks about their plans, the current crowdfunding campaign - and the question of which start-ups are suitable for this type of financing.

Mr. Schneider, the market for e-bikes is growing and growing, while at the same time there are more and more providers competing with each other. How do you want to stand out from the competition?

It's true, we are operating in an absolute growth market. In our opinion, the e-bike has the potential to significantly drive forward the change in mobility. It can persuade many people to give up their cars. To set ourselves apart from other manufacturers, we opted for a subscription model right from the start. The switch to e-bikes should be as simple and carefree as possible for customers. We need a popular e-bike, similar to the Aldi computer or the VW bus of the past.

And a subscription model will help?

E-bikes are often still very expensive. Subscribing with us saves a lot of money. However, demand for the e-bikes we have developed is now so high that we are now also offering them for sale directly. Anyone who rides one of our e-bikes also gets access to Smafo Connect. On the one hand, this includes theft insurance and we take care of repairs or replace the bike. A module in the bike also communicates with our app. We want to use this even more in the future. This summer, we want to launch a rescue assistant. If a sensor in the e-bike module registers an accident, the app will send three push messages to the rider via our app. If they fail to respond to all three, we will send an ambulance.

You have made it your mission to offer an e-bike that is affordable for the broad mass of customers. Their e-bike currently costs 1,799 euros. But there are also cheaper e-bikes. Discounters such as Lidl already have corresponding offers.

Admittedly, however, nowhere else can you get as much for the price as with us. Especially if you look at the subscription model: A subscription, which always runs for at least twelve months, costs 65 euros a month for our latest e-bike, which is 780 euros for a year. After that, the subscription can be canceled on a monthly basis, and if you wish, you can still purchase the e-bike - at a reduced price, of course.

So far, you have largely refrained from using outside capital, but have now launched a campaign for corporate crowdinvesting for a seed investment, which will run until June 7. Why don't you carry out a classic financing round or try to get in touch with business angels?

That would certainly have been possible for us. However, we think that crowdinvesting is better suited to our project. We want to build a community, we want customers and investors to recommend us to others.

What do investors who give you money now get?

In addition to the rare opportunity to participate in the growing e-bike market, you will receive discounts if you want to purchase an e-bike from us. But there are also a few other goodies, depending on how much you invest.

You have set a funding target of 750,000 euros, which is currently just over 600,000 euros. Although you are still short of a considerable amount of money, you have decided not to extend the campaign, why not?

Firstly, we don't want to suddenly present the private investors who gave us money at the start of the campaign with a new set of facts. We feel that would be unfair. Secondly, the crowdinvesting that we organized via Seedmatch involves a lot of resources. Incidentally, our investment threshold is 100,000 euros and we are very satisfied with the results so far. If we don't raise the full 750,000 euros, we'll just need a little longer to reach one or two of our goals.

There is a lot more behind your financing campaign at Smafo than behind a Kickstarter project, for example; among other things, you had to submit a business plan and set a fairly high financing target. Would you recommend this type of financing to other founders?

If you wanted to build a community on the side, definitely. However, founders should be aware that a lot of effort is involved. On the one hand, we had to present a good promotional video, and on the other hand, there's all the due diligence that goes into it. We also had to prepare this completely, just as we would for a financing round with professional investors. Just collecting all the relevant figures and submitting them to the responsible Federal Office of Economics and Export Control (Bafa) is very time-consuming.

About the person:

Sven-Ulrik Schneider actually comes from the automotive world. He opened a car dealership with his brother in 2006. In 2017, however, Schneider wanted to start something completely new and teamed up with his friend André Thiele. Schneider, who enjoys mountain biking himself, developed a plan with Thiele to set up a platform that lists offers from e-bike rental companies. They wanted to use it to reach customers who are only in the city for a short time. However, the variety of offers was too limited for both of them, which is why they founded their own e-bike start-up, Smafo, in 2018.