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2www.cadenceperformance.com
The Vision
more than a cLUB, more than a BIKe shop
• Destinationcyclinghubfortheenthusiastandfitnessroadcyclist,evolving tobeingsynonymouswiththegolf/gymmembershipbusinessmodel
• Theultimateaimisanational/internationalnetworkofdestinationcycling hubsdeliveringthefirstcommercially-runroadcyclingclub
• Servicesdeliveredon-siteandremotely(suchascoaching)usinginternally developedintellectualpropertye.g.Pedalfit
• 17potentialUK/Irelandcatchmentsidentified.Possibilitiesfor internationalopportunitiesthroughfranchiseroll-out
• EIS-qualifyingbusinesswithattractiveexitoptionswithin5years tocycletrade,fitnesscluboperatororprivateequity
3www.cadenceperformance.com
CyCle ReTail is Changing
a conventIonaL cycLe store:
cadence provIdes the aBove, pLUs…:
• SellBikesandComponents
• ServiceBikes
• BikeFittingServices-onsite,offsiteandonline
• Saddletesting,customfootbeds
• TreatmentProgrammes–cyclingspecificphysio&massage
• CoachingProgrammes–trainingprogrammesdeliveredremotely
• PhysiologicalTesting–lactatethresholdtesting,powertesting,VO2 Maxtest
• Indoortrainingfacilities–cyclingandexerciseclasses-thebadweather‘fix’
• ASocialHub–café,talks,seminars
• OrganisedEvents • Customerride-outs,‘Daywithapro’
• Corporateevents,includingproracevisitsandcorporateracedays
4www.cadenceperformance.com
The MaRkeT & TRends
ROADCyClIng-THEwORlD’SFASTESTgROwIngSPORT
• 13mcyclistsintheUKwith2.1mcyclingmorethanonceperweek–now theUK’sthirdmostpopularparticipationsportafterswimming andathletics*
• Cadence’stargetmarketarethe550,000FrequentEnthusiastriders plusthe1.2mSportridersintheUK**
• Affluent,highspendersontheir“passion”.Averagespendtoget‘onthe road’of£2,495**
• FrequentEnthusiastsarepoorlyserved Only10%aremembersofcyclingclubs***
Fewplacestoconveneandaccessservices
limitedoptionstogetexpertadviceonfitness,technique,onlinecoachingandtechnicaladvice
*ActivePeopleSurvey:SportEngland2014-15
**TheBritishCyclingEconomy:londonSchoolofEconomics2011
***CadenceCustomerSurvey
5www.cadenceperformance.com
The MaRkeT & TRends
hIgh growth marKet wIth LImIted servIce optIons
• TraditionalBikeShops Challengedbydiscountinternetretailers,limitedserviceofferings–focusonproducts
• CycleClubs Underfunded&limitedfacilities,canbeseenaselitist&intimidatingbynewcyclists, fewwithaphysicallocation
• Gyms Cyclistsnotwellservedbytraditionalgymsandfitnessclubs–pooradvice/equipment
• Indoorcyclingcentres/spinstudios Significantgrowth
Roadcyclistsuseindoorcyclingbutrequirebettersupport/advice
• Hugeglobalinterestincycling growthinthesportgloballywithsignificantbroadcastmediacoverage
Massparticipationevents–PrudentialRidelondon,CapeArgus
Advancesinaccessibilityandaffordabilityoftrickle-downpro-levelcyclingtechnology
Constanttechnologyrefreshdrivesnewsalesandeducation
Increasedawarenessofnewadvancesinscientifictrainingtechniques
6www.cadenceperformance.com
The CadenCe CusToMeR we target the hIgh spendIng and LoyaL ‘FREqUEnTEnTHUSIAST’
• Typicalclub/sportiveriderfrombeginnerstoeliteriders
• ThecurrentCadencecustomer*: 79%aged36-55,59%own2ormorebikes
68%spent£1000-£5000ontheirbikes
80%livewithin7milesofCadence
weestimatecatchmenttobe23,000sportiveridersand800racingcyclists
AnerleyHill–3000uniqueridersaccordingtoStravaHeatMap
• TheFrequentEnthusiast Expensivebike,keentogetmorefromtheircyclingexperience, Purchasemultipleservices
Interestedintechnology,bikegearandlatesttrendsintrainingtechniques
Examples-existingCadencecustomers
•‘James’–Aged31,MarketingManager
Purchasedbike-fitting(£150),majorbikeservices(£450),nutritionand shoppurchases£180,Fitnesstest£150,regularvisitortocafé
• ‘Chris’–retiredandrecentlytakenupcycling
Signedformembershipplan£99permonth
Purchasedhisfirstroadbike(£1000),kit(£400)andbikefit£150
Regularincaféandotherservices£25/week*CadenceCustomerSurvey
8www.cadenceperformance.com
The CadenCe PRoPosiTion hIgh margIn, prodUctIsed servIce offerIng wIth potentIaL for recUrrIng revenUes
HelpingtheEnthusiastdevelopthemind,bodyandmachineofaroadcyclist.
Thesetransactionpointscanbemonetisedonanad-hocbasisforthecasualcyclistorrolledintoasubscriptionmodelforaholisticsupportpackage
THECAdEnCE
HUB
wattBIKe stUdIoyOgA/PIlATES
cLasseshypoxIc traInIng
coachIngnUtrItIon pLannIng
fItness testIng
PRO-lED rIde oUts
cycLIsts cafe
corporate events
SEMInARS&events
TRAVEl&TRAInIngcamps
socIaL rIde oUts BIKe fIttIng
ClEAT&SHOEfIttIng
BIKe worKshop
BIKe saLes
cUstom BIKes
PARTS&ClOTHIng
SPORTSMASSAgE&physIo
socIaL technIcaL
fItness
9www.cadenceperformance.com
The CadenCe PRoPosiTion recUrrIng revenUe memBershIp pLans
• Productisedservicescanbepurchased asstandalonesubscriptionsorconfigured intomembershipplans
• Memberspaybymonthlydirectdebit
• Jerseyplanmemberssignforaminimum ofoneyear
• wattbikeandyoga/Pilatesmonthly rollingcontracts
• UpgradepotentialPeloton/whitejersey planupgradetogreen/yellowplans
• 14%ofourrevenueyTD2015is subscriptionsfrommembers
• 221memberswith80%growth
PlaN PelotoN PlaN
White Jersey PlaN
GreeN Jersey PlaN
yelloW Jersey PlaN
yoGa/Pilates WattBike CoaChiNG
MonthlyFee £10/MTH £29/MTH £59/MTH £99/MTH £35/mth £35/mth £30-£150/mth
CadenceClubJersey • • • •Shop&CaféDiscounts • • • •SaturdayRides • • • •FreeCadenceEvententry • • • •MajorBikeService • • •generalService • • •Intermediatebikefettling • • •UnlimitedwattbikeUse • • •TurboTrainerUse • •Unlimitedyoga • • •UnlimitedPilates • • •BikeFitting • •Bikefitfollowup • •PedalStrokeAnalysis • •CriticalPowerProfiletest •wingateTests •lactateThresholdFitnessTests • •HypoxicTraining •CustomCoachingPlan • •
10www.cadenceperformance.com
The CadenCe PRoPosiTion BIKe saLes and worKshop revenUe
• CadenceisaGiantBrandstore Oneof22brandstoresintheBritishIsles
Specialtermsonbothgiantandlivranges
Higherprofitmargin
Bikestockonconsignment–bikesarepaidforatendofmonthfollowingthesale
Overnightautoreplenishofbikesandcomponents–directconnectiontogiantwarehouse
• ComprehensiverangeofbikeWorkshopservices Offerrangeofbikeservicepackagesrangingfrom£75to£150
Operates7daysperweekanduntil9pmonweekdays
Maintenanceclassesandinstruction
11www.cadenceperformance.com
The CadenCe PRoPosiTion BIKe fIttIng and posItIon optImIsatIon
• Bikefitting OfferRetul,dynamicandoptimumfittingoptions-£100to£350perfitplus ancillarysales
3fitterswith2fittingroomsoperating7daysperweek
Upto150fitspermonthduringpeakseason
• Saddletestingfitting Usepressuremappingtoidentifyoptimumsaddletype
Testandtrialbeforecustomersaddlepurchase
• CleatFitting Ensuresoptimumsettingofshoesandcleats
• CustomInsoles CustominsolesfromSidas,Fizik,g8
Pricesfrom£100
• PedalStrokeAnalysis Usesvideocapturetoreviewcustomerpedalstroke
Reviewandrecommendcorrectionstoimprovepedallingefficiency
12www.cadenceperformance.com
The CadenCe PRoPosiTion
FITnESSTESTIng,wATTBIKESAnDyOgA/PIlATES
• Fitness&Coachingservices Includeslactatethreshold,MaxHeartratetest,MaximalPowertest,V02Test andCriticalPowerProfile
Pricesfrom£100–a‘one-off’orprovidedaspartofacoachingplan
• CoachingPlans Startswithinitialassessment
Plandefinedbasedonobjectives,ridersavailabilityandfitnesslevels
• Wattbike 16bikestudio,classeseverydaywithextraclassesformums&babies and‘Silverfit’
£10perclassonaoneoffbasisoraccessedusingamembershipplan
Over1000riderspermonthusethestudio
• Yoga&Pilates Classeseveryday
£10perclassonaoneofforaccessedusingamembershipplan
13www.cadenceperformance.com
The sToRy so FaR
POP–UPSITETOFUllROll-OUT
• Establishedexistingsiteas‘Pop-Up’openedin formercarshowroomendMarch2012 •Focusedondefinition&testingproductisedserviceofferings
•nowconvertedto10yearlease
•RefurbishedbuildinginDec2013-Jan2014,reopenedMarch2014
•Revampedretail,café,bikefitroomsandworkshop
•Introducedgiantroadperformancestoreconcept
•Installedwattbikestudio,Pilates/yogaroom&fitnesstestingroom
• Consistentrevenue&footfallgrowth
•45%+grossProfitwith80-100%yearonyeargrowthinrevenue
• Tractioninlocalcatchmentandcredibilityintheindustry •Establishedasthoughtleaders-regularfeaturesintradepublications,usedasthe studiolocationforthe2014seriesofITV’sTheCycleShow
• Operationalmodelfurtherdefined&newcatchmentsidentified
Consistent growth in sales and gross profit
The Story So Far
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Sales
Gross Margin
Expon. (Sales )
Note sales up to Feb 2015 include Café – Café now on concession paying a fixed fee per month plus % turnover
All numbers exclude VAT
14www.cadenceperformance.com
The sToRy so FaR strong year on year saLes growth performance
notesalesuptoFeb2015includeCafé–Cafénowonconcessionpayingafixedfeepermonthplus %turnover
AllnumbersexcludeVAT
15www.cadenceperformance.com
The sToRy so FaR ACHIEVEDBREAK-EVEnFIRSTHAlF2015
2012-13 fy actUaL
2013-2014 fy actUaL
2014-15fy actUaL
2015-16hy actUaL to end aUgUst
2015-16fy projected
SAlES(ExVAT) 188,390 £401,365 £792,078 £519,488 £940,917
eBItda(ExClHEADOFFICE)
(£183,894) (£273,819) (£91,996) £49,183 £66,622
head offIce £- £24,021 £95,194 £32,530 £65,060
eBItda(InClHEADOFFICE)
(£183,894) (£297,840) (£187,190) £16,653 £1562
%gROSSPROFIT 38% 41% 45% 45% 46%
16www.cadenceperformance.com
The sToRy so FaR lESSOnSlEARnEDIn‘POPUP’PHASEBEIngUSED to gaIn rapId tractIon
totaL saLes By year (ExClUDIngCAFé)
eBItda (ExClUDIngHEADOFFICECOSTS)
• nowatbreak-evenatCrystalPalacesite
• Monthlyfootfallincreasedfromlessthan500inApril2012to2,046inMay2015
• Undertake90-100+bikefitspermonth,150inpeakmonths:oneofthebusiestbikefittingcentresintheUK
• 221monthlysubscriberstoservices,averagesubscription£56pm
• CafémovedtoconcessionsinceMarch2015
AllnumbersexcludeVAT
17www.cadenceperformance.com
Funding RequiReMenTs THEBUSInESSSEEKSTOATlEAST£300,000InTHIScrowdfUnd roUnd to acceLerate growth
projectIons
projectIons CRySTAlPAlACEExISTIngSITE(InClUDEDInTHEABOVEPROJECTIOnS)
2015/16projected
2016/17projected
2017/18projected
2018/19projected
2019/20projected
saLes £940,917 £1,718,190 £3,106,657 £4,425,664 £5,232,931
eBItda £2,832 £29,127 £300,953 £720,127 £1,036,727
net profIt £(44,877) £(62,655)** £170,981 £654,414 £866,256
2015/16projected
2016/17projected
2017/18projected
2018/19projected
2019/20projected
saLes £940,917 £1,157,204 £1,235,823 £1,246,346 £1,246,346
eBItda £66,622 £188,486 £244,279 £249,550 £249,550
**Includesinvestmentinsecondsite–plansassume24monthstobreakeven
19www.cadenceperformance.com
The ManageMenT TeaM hIstory of sUccessfULLy deLIverIng retUrns for sharehoLders
directors FrankBeechinor–Co-founderandCEO FrankistheCEOandisanexperiencedentrepreneurandbusinessman. Hewasaco-founderofOneClickHR,aHRsoftwarebusiness,whichhefloatedon thelondonStockExchangeAIMMarketin2000andsoldtoADPin2011.Frankis currentlynon-ExecutiveChairmanoftwocompaniesonAIM,DotdigitalPlcand ComsPlc.Frankhashadaninterestincyclingfromanearlyageandestablished abicycleshopashisfirstbusinesswhenhewas17andusedthistopayhis waythroughuniversity.HemovedtotheUKin1987andjoinedgrand Metropolitanplc.
RayVella–Co-founderandDirector RayisagPwithalocalpractiseinBeckenhaminKent.AlongwithFrank,Ray isaDirectorofthecompany.Heisakeencyclistwhounderstandstheneedsof ourcustomers.HerideshisbikeeverydayandisanarchetypicalFrequent Enthusiast.Heprovidesstrategicdirectiontothebusiness.
OperationalManagement AdrienneCadle–FinanceDirector AdrienneisFinanceDirector,aqualifiedaccountantwithanextensive backgroundinsettingupfinancialsystems,controlsandmanagementreporting. ShejoinedCadenceinJanuary2014andmanagesdaytodayoperationsofthe business,ensuringaccuratefinancialinformationisproducedwithmanagement reports.PreviouslyAdrienneworkedasafinancialcontroller/manageratReed Employment,P&OandOfficeCanopygroup.
SeamusKelly–generalManager Seamushasmanyyears’experienceinthecycletraderunningbikeshopsintheUK andIreland.ACat3roadracerSeamushasacomprehensiveunderstandingof biketechnologyandtraining.
CiaranO’Grady–SportsScientist CadencefundedCiarantoundertakehisMScinsportsscienceattheUniversity ofKentwherehisfocuswasonindividualisedtrainingplansforcyclists.Heis abouttoembarkonhisPhDwhichwillbefundedbyCadenceandhisresearch willcovercoachingtechniques.AspartofourrelationshipwiththeUniversitywe shareCiaran’sresearchfindingsallowingusapplythistoourservices.
EdCollins–HeadCyclingCoach Edisaformerpromountainriderandacompetingroadandcyclocrossrideras wellasbeingalevel3BritishCyclingqualifiedcyclingcoach.Edisresponsible forourcoachingplansandstrategy.
Aimtobuildteamtosupportfullroll-outofconcept
20www.cadenceperformance.com
WhaT ouR CusToMeRs say
great feedBacK from cUstomers
Thanks to the great folks at CADENCE whose support and advice was essential in getting Wim and myself prepared for going up col after col during the Haute Route Alps 2013.HansgerbeurSept2013
DaveBGreat place, been going there from the start. Recently got a new saddle and it was nice not feel the pressure to choose the first one Also get an orthotic heating and fitting with Simon which lasted a good half hour to get it right, as well as the mechs fitting in some quality work on the bike at short notice (though that may be a luxury that is short-lived given how popular the shop is getting!). Keep it up, guys, you’re fulfilling an important function in Crystal Palace.
FormorereviewsvisitgoogleReviewsandFacebook
JonArmLocated in the heart of the south London cycle culture, Cadence brings the long waited cycle hub, offering great coffee, food and all you could need in cycling equipment and tech advice. Its a great place to end your training ride, or your social club ride. If you are a cyclist and are looking to take your cycling to the next level, Cadence is the place for you to get advice, bike fits and anything else you might need to get your body and equipment up to speed.
MarkJonesLove this place.....in the early days, had a chance to spend 45 mins with des discussing the best use of this and the best use of that....now they are lucky enough to be as busy as they deserve. From turbo sessions to bike maint. to watching re-runs of races and eating cake whilst “working from home” with the free wifi, they are great.
laurenKristinaAnnelepleyBloomin marvellous! Awesome service from all staff and a great bike fit! Thanks guys! Oh and great coffee and cake too even if you don’t have a bike!
RobHannamI am what some would say, a ‘larger gent’ as such struggle with my cycling, so, after a recommendation I went for a bike fit with my Tri bike, it was transformed, from something that was nearly unrideable, to a much more comfortable ride. That was last year, this year I went back with my road bike, just in time for ironman 70.3, Des worked some magic and once again the bike was transformed! I am hard to impress, but the service and skill I received on both my fittings did the job. There seems little point spending thousands on a fancy machine if it don’t fit. Money very well spent! Will be back again most definitely be back!
ChrisHueyI’ve used Cadence for a bike fit and also a LT testing session in recent months. Both were great, carried out by experienced staff who know the answers to all sorts of questions and are always willing to offer ongoing advice. I also joined the Cadence group for an event with Marco Pinotti, a brilliant day out with a seasoned professional. Thoroughly recommended as a cafe, bike shop and great group of bike-loving people.
22www.cadenceperformance.com
a sTandaRdised oPeRaTing Model
standardIsed processes and great peopLe ensUres consIstency of servIce
• Focusondevelopingstandardisedoperatingproceduresfor allaspectsofthebusiness
• Currentlystaffof11pluscontractors • Including3bikefitters,2coaches,2mechanics
• Therightattitude-passionateaboutcyclingandstrongbeliefthattheremustbe a‘newway’toservethecyclingmarket
• Multi-skilled–e.g.bikefit/coach/sell
• Versatileapproach–notpatronisingtobeginnersbutcredible withexperiencedriders
• Staffselection • Seekpeoplewiththerightattitude
• Multi-skilled-ourkeypeoplemustbeabletotalkknowledgeablytoclientsabout fitness,mechanics,bikes,parts
• Operateapolicyof‘growingourown’–alwaysdevelopingthenextgeneration ofmanagersfornewsites
23www.cadenceperformance.com
use oF neW inVesTMenT
acceLerate oUr geographIc expansIon
• Geographicalexpansion–openmorecentres • AddtoinitialsiteatCrystalPalacewithasecondsitein2016and,ifweachieve ourfinancialobjectivesfurthersitesto2017andbeyond
• Potentialtoexpandto5centresintotalinUKover4years.Oncefundingin placesearchcommencesearchforsuitablepremises.FocusaroundtheM25 –CrystalPalace,Swlondon/Surrey,northlondon/HertsandBucksbut willbroadensearchtoothercatchments
• Potentialforupto17centresinUK&Ireland–butalsopotentialforvirtualgrowth– onlinetrainingplans,cyclecoachingapp/website
• Eventualinternationalrollout-potentialtofranchisecentremodel
• developourCorporatebusiness • Clientsalreadyincludeguardiannewspapers,CreditSuisse, warnerBros,MottMcDonald
• Highmargineventswithgoodpotentialforrepeatbusiness
• Addmarketingresourcetoincreaseourcorporatebusiness
24www.cadenceperformance.com
use oF neW inVesTMenT expLoIt oUr InteLLectUaL property and acceLerate oUr growth In annUIty revenUe
• Leverageourcyclingcoachingcapabilitythroughtechnology • wewishtocreateanewgenerationcloud-basedcyclecoachingsoftwarewhichwill alsobecomethetechnologyplatformtooperatetheCadencecentres
• Integratefitnesstesting,coaching,nutrition,pedalstrokeanalysis,bikefitting intooneseamlessprocess
•willallowustodeliverourcoachingservicesremotely–growourvirtualbusiness
•Enablesustoexploitopportunitytodelivera‘whitelabel’coachingserviceto partnersinthefitnessindustry
• DiscussionsunderwaywithmajoroperatorinthebicycletradewherebyCadencewill providea‘whitelabel’coachingservicetotheircustomersacrosstheUK
• IncreaseourMembershipbase • Currently221customerson‘paymonthly’,payingaverage£56permonth
• Focusonmarketingourmemberplanstoabroaderaudiencewiththe aimofgettingto300-500memberspersite
• Buildourannuityrevenue
• Providea‘singleview’ofclients’transactionsandservices
•Integratepredictiveanalytics;increasecross–sellopportunities tomembers/customers
25www.cadenceperformance.com
suMMaRy
UnIqUEROllOUTOPPORTUnITyInAHIgHgrowth marKet
• Uniqueserviceoffering–nottraditionalretail–inoneofthefastestgrowingsportingsectorsintheUKandabroad
• Highmarginwithrecurringrevenues
•MatureHubbusinessmodelrunswithhighmargincashgenerationwithhighrecurringrevenues
•nowthatmodelisrefinedc.24monthstobreakevenpercentre
•45%+gPpercentre,withpotentialtoincreaseasserviceofferingincreases
•Potential25%+EBITDApercentre
• Potentialforcoachingbusiness •Onlinecoachingcanbehighlyprofitable,withrecurringrevenues,asitgrows
•Coachingplatform–whitelabelready–potentialtosellthroughthirdparties
• Rolloutopportunity •Potentialforroll-outintheUK:17catchmentsidentified
•PotentialInternationalopportunityviafranchisemodel
• Shareholders •qualifiedEISbusiness
• Exit •Tradesaletomajorbusinessinthebicycleorfitnesscentreoperator
•Possibleflotationifweachievesufficientscale
26www.cadenceperformance.com
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ConTaCT us noWTelephone 02086768825Email [email protected] www.cadenceperformance.comTwitter @cadenceperform
CadencePerformancelimited2aAnerleyHill,CrystalPalace
londonSE192AA