March 31, 2010 (Montreal, QC) – Guru is one of only a handful of custom bike frame builders in Canada and the company has often created a buzz with its quality, innovative designs. Its latest super-lightweight Photon frame, claimed to be the industry’s lightest full custom production road frame, tips the scales at 747g. But Guru’s success was recently threatened when it had a brush with near financial disaster in 2009. In late fall last year, investor and marketing specialist Ted Matthews joined the company as CEO and Guru regrouped. The revitalized company is excited about the changes and we caught up with one of the founders and Guru President Tony Giannascoli for an inside look at the company’s past, present, and future.

What year was Guru established and have you always been based in Laval, QC?
Tony Giannascoli: I was an engineering student at McGill University in 1992 and, together with a buddy, we started building bikes as a hobby. The thing took off and we founded Guru in 1998. We moved from Montreal to Laval because land was cheaper there. Laval also has great bike paths.

Some refer to Guru as a frame builder while others say you’re a bike manufacturer. Which is correct?
TG: Guru is a custom frame builder and we work closely with parts manufacturers. We focus on the frames and get the parts from other vendors. This [business] model has been working well for us for the past two years. Prior to that, we tried to have parts as part of our inventory but that was problematic.

How many employees work at Guru and what’s the annual production?
TG: We have about 40 employees of which 10 are ardent cyclists. I’m a casual cyclist myself. We produce about 2,000 bikes per year but our capacity is probably closer to 6,000.

What’s Guru’s current product range?
TG: Guru produces five road bike models, five triathlon models, and two cyclocross models.

You manufacture carbon, titanium, aluminum, and steel frames, all at the plant in Laval?
TG: Yes. We started with steel, then aluminum bikes. With the metal bikes, we buy the tubing and weld the bikes here. With the carbon bikes, we actually start with the raw materials and control the resin-to-fibre ratio to meet our specs for a particular bike. It’s extreme engineering here and my background in that field is an advantage.

Guru is known for its custom frames. How does this process work for consumers and bike shops?
TG: The vast majority of our dealers have fitting bikes that the customer rides to begin the process. We use algorithms to determine the ideal measurements for the bike to optimize power. This leads to a drawing that is sent to the dealer for final approval. Normally it takes about one hour for the fitting process at the bike shop and four weeks turnaround from the time the customer first tries the fitting bike until the finished product is at the dealer. This turnaround time is an industry-leading time frame. We’re able to capture multiple fits in real time and now have patented a process to adjust the fitting bike.

Guru’s Photon is your latest lightweight carbon frame. How is it
being received?
TG: We are excited about this bike, which features the lightest frame on the planet [747g for a 54cm frame including an integrated seat mast]. Building the thing was an engineering challenge because while we wanted it to be very light, it also had to be strong enough to offer a lifetime warranty. [base price for the Photon is $5,200 Canadian]

How was the company forced into receivership by the bank and then brought back from the brink by Ted Matthews?
TG: The past 18 months have been brutal for us. Sales were way down in 2009 and everyone wanted to get rid of inventory. Our bank lost confidence and repossessed our assets, but we hadn’t defaulted on any loans. They simply lost confidence.

Was it a case of the company having great products but suffering from mismanagement?
TG: Guru has always been able to grow its business but we were over-leveraged in the middle of a financial crisis. While 2008 was a great year for us, we had cost overruns on our new building and growing pains as we moved to the new facility. We brought in a friend to negotiate with the banks. We spoke to Ted Matthews before all of this happened; he eventually bought our assets back from the bank.

What kind of a cyclist is Ted Matthews and what are the plans for the company in Canada, U.S., and abroad?
TG: Ted is an athlete and notable golfer, but only a casual cyclist. We’re building a frame for him that might convert him into becoming a keen cyclist. We plan to continue growing our dealer base and solidifying our place in the North American market. Internationally, we’ve had telephone calls from Germany and South Korea; there’s a lot of interest out there. But we know that before we expand into those areas, there must be a sound structure in place.

You opened your first concept store last year in Montreal. Where is it located and how is it doing?
TG: Yes, we opened at 5428 St. Lawrence Blvd in Montreal. That store is a great window into the challenges faced by our retailers. The knowledge we’ve gained there helps our inside sales reps to respond more honestly and directly to questions during PK sessions. But one concept store is enough; we don’t plan to build any more.

What is the present market for Guru products and is there a
typical client profile?
TG: At present, we’re looking at about 50% tri customers and 50% between road and cross combined. But cross is very small, only about 5%. Many of our customers are performance-focused. But also some of our customers are weekend warriors and people who are simply looking for a quality comfortable bike.

Guru Bicycles
2460, rue Michelin
Laval, Quebec H7L 5C3
450-687-6644; 877-755-GURU; fax 450-687-8644
nasales@gurubikes.com
www.gurubikes.com