Tradition Is Not A Business Model: MotoCzysz

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Today I want to broach the subject of what it means to be not only a motorcycle startup, but what it means to be an American motorcycle startup. For a majority of our readers, the concept of American motorcycling is something that we have understood since our days as children. No matter how you came to this industry/sport/lifestyle, as a reader of A&R you no doubt have a strong personal compass of what is means to be an American motorcyclist, and it is something that you touch and understand on a daily basis.

The business side of this understanding is less straight-forward though. It is one thing to identify personally with what makes an American motorcycle, but it is a very different exercise to build a product that evokes that same emotion to the mass consumer. This concept becomes even more relevant today, as the motorcycle industry is still recovering from the news of Buell’s closure and Harley-Davidson’s drastic measures to stay afloat. With no precognition of this impending news, I headed to Portland, Oregon to talk to Michael Czysz, CEO of auto-biographically named MotoCzsyz. Czysz’s journey presents a unique story about a company that has twice attempted to create an American-bred sportbike, and as such is the appropriate company in which to frame our topic about what it means to be an American motorcycle startup.

It’s impossible to start a discussion about American sportbikes without first involving Buell Motorcycles. This fact becomes even more topical with the recent news of Buell’s closure, and Harley’s circling of the wagons around the Harley-Davidson brand; these actions perfectly portray everything that has been broken in the American sportbike scene, and larger American motorcycle genre.

In its 26 years of existence, Buell for all intents and purposes, has been the only name in town when it came to American sportbike manufacturing. While some attempts have come and gone, in recent news we’ve seen companies like Roehr and Fischer begin to ship units, Buell has remained the only established manufacturer on American soil. Since it’s a subsidiary of Harley-Davidson, Inc., Buell shares many problems with its parent company. The most notable problem stemming from this relationship would be the notion that American sportbikes must be derivatives of American cruisers. Buell, until recently, used modified air-cooled Sportster motors, which were heavier and less powerful than comparable water-cooled power-plants. The result was less than successful.

While Buell’s motorcycles were fun to ride on the street, they could not compare to the standards that were being set by both the Japanese and European manufacturers. Why other companies chose to follow the Buell example, sourcing motors that were intended for heavy cruisers, is beyond this writer’s comprehension, but whatever the rationale may be, the result was a vacuum of consumer desire for a true sportbike from an American manufacturer. One such person who shared that desire was Michael Czysz.

MotoCzysz is really more of a restart than a startup. The company’s first iteration for an American spotbike was Czysz’s MotoGP contender: the 990cc C1. Incorporating numerous motor and chassis innovations, the C1 broke away from the notion that an American sportbike should trace it roots back to the popular American cruiser scene. What looked to be a promising entry into the sportbike market, the C1was a victim of timing: breaking cover just as MotoGP regulations moved from the tire-shredding 990cc displacement to the “safer” 800cc formula. The displacement switch was a considerable blow to MotoCzysz, which had substantial time, money, and effort tied into their 990cc power-plant, and it seemed for a moment that this would be the last we’d hear from the Portland-based company.

For Czysz, an effort to build an American sportbike meant a departure from the Buell model, and instead he grounded his company’s success in the performance of its product. This is perhaps partially due to Czysz being “a racer’s racer” and consummate competitor, but it also takes root in the fact that the American sportbike scene had remained broken for so long, and clearly wasn’t thriving in the competitive marketplace because of its lack of product parity.

Also described as a “racer’s racer”, Erik Buell, and his baby Buell Motorcycles, never got a fair shake in the industry. The most recent actions by Harley-Davidson, Inc. show the company’s true colors of being built around a single brand. Despite the fact that over the course of its business operations it decided to expand the range of brands under the HD umbrella, acquiring both Buell and MV Agusta (you could throw Cagiva into this argument as well), Harley-Davidson, Inc,’s real bread winner brand has always been its Harley-Davidson line of cruiser motorcycles. Instead of establishing its other brands to stand on their own two feet, Harley-Davidson, Inc. cobbled its acquisitions to always be second priority to the HD brand. The Harley-Davidson roots permeated into Buell’s distribution, marketing, and cultural aspirations, and also affected choices on the bike’s design.

The result was a product that probably helped boost the value of the Harley-Davidson brand (and bottom-line), but also brought about the “cruiserfication” of Buell’s sportbike aspirations. For many, including Czysz, this was an affront to what it meant to build a performance motorcycle, and what it meant to pawn off that creation as being “American”:

“We don’t want to put the flag and all that in front of the product, the product needs to speak for itself. The fact that it was American made would be awesome and an asset to meet all the goals, but you need to make a product that can compete on all the levels with all the products that are out there. If that isn’t being done, then companies tend to compensate…overly compensate with the nationalism.”

When one talks about marketing, and let’s be honest here…putting an American flag or “Made in the USA” sticker on a product is an exercise in marketing, what we’re talking about is engaging a customer with a product, creating a bond with them and their purchase decision. Rarely can this goal be accomplished with broad brush-strokes, and this is where American motorcycle companies get into trouble. Drawing on themes of Americana, and what motorcycling represented for one generation, is not a strategy that travels well as time passes on.

A third generation motorcyclist, Czysz, like many others, wonders how he and future generations are supposed to find appeal in the Milwaukee brand. Shrugging at first, Michael laments:

“I dunno…I mean, I think it’s pretty self-evident. There is almost no greater company in the United States than Harley-Davidson, I just wish they had the kind of products that drew me in and my young sons, and that they would leverage ability to be a real force, rather than just being a nostalgic company. We deserve more. They should respect the brand more.”

When you look at the history of motorcycling in the United States, and localize the icons that have stood out prominently, you get a very flat perspective of our riding culture. We find images of Peter Fonda and Dennis Hopper from Easy Rider, the Hells Angels, and James Dean: icons of rebellion from an older generation. Quite simply, these images don’t resonate the same way with the younger mass of riders. That’s not to say that these icons have lost their meaning over time, but for an increasingly larger proportion of motorcyclists, these figures become less pertinent to the motorcyclists identity. No greater proof of this can be found, than the ever increasing average and median age of Harley-Davidson riders.

Harley-Davidson is a company that cannot be removed from these cultural images, so when the 20 year-olds from the 1960’s look for a way to express their individuality, these are the images they rely on, and Harley-Davidson is a company they are drawn towards. But what about our current generation of 20 year old rebels? By and larger, the chopper movement has been replaced by the sportbike market (just as the hot-rod scene, has given way to the tuner scene…coincidence?). For American youth (and the young at heart), high-octane, high-performance vehicles have been an anchor of rebellious expressionism. This is a phenomenon that does not exist with anywhere near the same magnitude in other cultures. It is this vein that an American sportbike company needs to resonate with its riders. For company’s like MotoCzysz, this means that a renewed hyper-vigilence of how their product performs compared to the competition becomes the single largest factor in determining its success, while there must be a de-emphasis of where that product is designed and produced.

“We’re the largest market in the world for high-performance bikes, and Japan and Italy are sitting down, and they’re thinking about their next bike. They’re heavily considering what they will sell in the American market. If you want to buy a bike that was made in America, you should be able to buy a high-performance bike that’s made here.”

…and you know, I keep looking up and I’m bummed and disappointed on a world level about what we [Americans] have done.”

What I am arguing here is not the creation of a taboo for nationalistic pride, but instead an awareness that when products are marketed purely on geography, it cheapens not only that product, but the industry as a whole. In many ways the 1125R/CR could have been Buell’s saving grace. It marked the company’s willingness to get serious about its performance offering, sourcing a liquid-cooled Rotax motor instead of relying once again on the Harley’s Sportster power-plant. However, it also showed Buell/Harley’s continued willingness to abuse America, the brand.

Talking about how he avoids a similar mistake, Czysz can’t help but to share the frustration that many Americans felt as they watched Buell finally race its first legitimate sportbike offering against 600cc sportbikes and under-classed Italian v-twins.

“You make sure that if your goal is performance then you sell a performance bike. You don’t just build yourself up on it being a patronage of being that the bike is American, it needs to eventually have performance. Now one of the American companies just won a Championship this year, but they did it with virtually twice the displacement as everybody else. They can say, ‘well it has less cylinders’. But yeah, we already have that formula. That formula has been running around for decades, and no body got twice the displacement.”

In what should have been a step-forward for American sportbiking, the reality was a bitter-taste was created as racing enthusiasts speculated as to whether there was some self-dealing going-on in the AMA with the largest American motorcycle manufacturer. Instead of innovating around a problem, once again we see the American motorcycle industry’s inflexibility to change, choosing instead to race in a stacked competition. This series or articles is of course an examination of the fringe efforts by some startups to bring innovation to motorcycling. Talking about the opportunities available now in the motorcycle industry, Czysz states that there is change in the air.

“It is truly ironic to people outside of the industry…these [motorcyclists] are supposed to be the guys that are the free-thinkers, the easy spirits, and the whatever, but the reality is they’re actually quite reluctant, and extremely pessimistic as a whole. And for the most part, a small fringe group wants to see change and embrace it, but the large percentage is content with where we were or where we’ve been, and assumes that any big innovation is going to ruin what they have or takeaway from what they have. There is a surprising amount of reluctancy to try new innovation and technology. I guess a part of that is there’s enough history where people have said that’s what they can do, and haven’t delivered, so I think at some point its self preservation.

…It is not the easiest industry to jump in, it’s easier than the car industry, but it’s still difficult. However that being said, both of these industries are easier to jump into now than they were 36 months ago. Now they expect innovation to from entrepreneurial startups, and not the large giants that have been slothing around for the past 30 years.”

I won’t belabor any further the innovation surrounding the electric motorcycle, but MotoCzysz is an example of a company in the industry that was able shift its focus and become an early adopter of what appears to be the next generation of motorcycling. Moving from his C1 project, a cryptic message appeared on the MotoCzysz website early in 2009:

“It became very apparent to me that I was working to catch up in an era coming to an end – maybe I should set off and try to lead in an era arriving” -MC

What we would all learn later is that Czysz et al were planning on making the switch to electric drive motorcycles, and would be swapping their MotoGP effort for a day of racing in the inaugural TTXGP at the 2009 Isle of Man TT. Michael Czysz, for better or worse, is the obvious driving force in his company. We could devote perhaps an entire article discussing the criticism and critiques that his doubters, competitors, and partners have levied against him, but that discussion would conversely have to end with an honest assessment of what it means to be an entrepreneur.

Excluding serial-entrepreneurs from the discussion, entrepreneurship often starts with a single vision/goal/dream. What separates successful entrepreneurs from others who fail, is the ability to persevere, break through walls, and overcome adversity. More often than not, you’ll find that entrepreneurs have thick skin, strong wills, and are obsessive about achieving their goals. Czysz is a tremendous example of these characteristics. For him, there is a strong desire to shape the future of the motorcycle industry.

“For me, there could be no greater accomplishment, at all, than to create, or to be involved, or to participate, or to somehow help in the American motorcycle scene. That is my goal, and I’ve jeopardized literally everything that I have…you would be surprised to find out what I was willing to do…sheer lunacy. To be honest, it was just stupid. But at some point its kind of like, you know…I’m quite confident we have one life on this Earth, and unfortunately motorcycles have been a huge part of my life, as it was my father’s, my grandfather’s, and my great-grandparent’s.”

For someone like Czysz who is in the industry to make his mark, the ability to switch gears and embrace a new idea is infinitely more attainable than it would be at company that is trying to maintain market share and revenue. The latter is essentially fancy wording for maintaining the status-quo, while the prior is interested finding a foothold and leveraging it. This is the fundamental nature of startups vs. entrenched corporations, so it should come with little surprise that this past summer we saw MotoCzysz at the first ever TTXGP.

While not the best outing for MotoCzysz (Michael would describe it as: “Awful..it couldn’t have been worse”), the event showcased three American companies that were willing to take on this new challenge of electric motorcycles. With a tremendous amount of innovation coming out of these companies, MotoCzysz in particular, the American motorcycle industry has the opportunity to have new life breathed into it. Instead of being known for its blind attachment to nostalgic designs, the new motorcycle industry lead by these startups has to chance to be an industry leader. Perhaps even more important, American motorcycles have an opportunity to be revered as the most advanced, the most innovative, and in the performance category: the fastest.

Because of these factors, it makes the next coming year a very pivotal and exciting time to be a part of the American motorcycle industry, and to see how the American sportbike gets redefined in the world market.