Santa Cruz Bicycles: Not Your Father's Ride

By Mel Duvall Print this article Print

Build, crash, repeat: Santa Cruz Bicycles digitally designs and builds mountain bikes tested under the most extreme conditions, and uses product lifecycle management software to get them to market fast.

Hanging on the wall in the fabrication shop at Santa Cruz Bicycles is a frame that represents the company's greatest success—and its greatest problem.

Originally constructed in 2001, the frame is the first designed with the patented Virtual Pivot Point (VPP) suspension system. Without getting into technical detail on what makes the VPP so special, it provides a means to absorb bone-rattling shocks as riders soar off ridges or hurtle down mountains, without depleting riders' energy for pedaling up hills or out of holes. The frame represented more than three months of design work and four months of custom fabrication by outside machine shops. When the prototype arrived at the company's offices, in a converted cannery building near the Pacific shore in Santa Cruz, the engineers couldn't wait to put it through its paces.

The first test didn't go so well. The VPP joint's upper link snapped after a quick jump off a relatively low ramp.

"It only took one ride to realize that the thing sucked," says engineering manager Joe Graney. "Here we were seven months in, a lot of money in the hole, without a bike to bring to market."

The experience served as a catalyst for the company to overhaul its design and engineering processes. To capitalize on its patented technology and ultimately grow the business, it had to find a way to get designs off the drawing board and into prototypes faster. That led the company, which at the time had only about 25 employees, to make the leap into product lifecycle management software. Santa Cruz Bicycles—and the impressive growth it's experienced since—demonstrates that PLM software is not just for the Toyotas, Boeings and General Electrics of the world, but also for midsize manufacturers with tough design challenges.

The Santa Cruz Bicycle story begins in 1993 when former professional skateboarder Rob Roskopp teamed with fellow boarders Mike Marquez and Rich Novak to launch the company. While the three got their start in skateboards, and in fact started a sister company called Santa Cruz Skateboards, they had also become avid mountain bike enthusiasts, feasting on the terrain along the famed Pacific Coast Highway.

The company enjoyed modest success through the 1990s but remained a relatively small, custom-fit shop with about $6 million in revenue. In 2001, Roskopp came across a design for a new suspension system—the VPP—originally developed by Outland, a small bicycle manufacturer. Outland had not been able to capitalize on the design, but Roskopp saw its potential and negotiated a deal to buy the patent. The company introduced its first bike with VPP suspension at the 2001 Interbike show in Las Vegas. The design turned heads.

An impressive feature was that the new pivot design allowed the rear wheel to travel a full 10 inches. That means when a rider lands off a jump or hits a rock on the trail, the rear wheel can bounce up 10 inches without hitting the frame or the seat. It provides that shock absorption without giving the rider the sense of sitting on a coiled spring. "That's the goal," Graney says. "You want the bike to have that squishy feeling, but without bouncing up and down when you pedal."

A year later the company introduced the Blur, a cross-country version of the VPP design, which won a number of industry awards and spurred a leap in sales. Today, Santa Cruz Bicycles employs about 70 people, produces some 10,000 frames a year, and has been increasing sales by more than 40 percent a year. The private company won't reveal specific revenue figures, but its bikes typically retail for $1,500 to $6,500. Next Page: A Challenge ... and A Solution

This article was originally published on 2007-11-30
Contributing Editor
Mel Duvall is a veteran business and technology journalist, having written for a variety of daily newspapers and magazines for 17 years. Most recently he was the Business Commerce Editor for Interactive Week, and previously served as a senior business writer for The Financial Post.

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