Luna Cycle: A Peek Behind the Scenes

A little over a year ago Luna Cycle appeared to burst onto the ebike scene from out of nowhere, shocking the market with a wide range of ebike parts at shockingly reasonable prices. Ever since they’ve kept a steady stream of new products and innovations flowing, not only surviving but eventually thriving in the tough ebike market. So I had to sit down with Luna Cycle’s founder Eric and see what made Luna tick.

I assumed I would be learning about the history of Luna Cycle, but I soon realized that it goes deeper than that. Because the history of Luna Cycle is really the history of Eric.

Eric got into electric bicycles back in 2002 for many of the same reasons that we all did, namely finding an alternative to gas powered cars that could be both fun and useful. It also helped that he lived in San Francisco and found that ebikes could flatten out the steep terrain. Soon he was organizing group rides and hill climbing races around San Francisco while simultaneously becoming a major contributor to Endless Sphere, the main ebike forum that most of us use to talk shop and learn about ebikes.

Eric started spending so much time on Endless Sphere (ES) that it started to feel like an obsession, or even almost an addiction. Many people in the DIY ebike community know that Justin of Ebikes.ca is considered something of a “savior” on ES for buying the forum with the purpose of keeping it ad free, but few people know that Eric nearly became that savior first. In doing so, he ended up creating one of the largest ebike informational websites on the internet, electricbike.com.

It’s a really interesting story of how it all went down, so I’ll let Eric tell it in his own words:

“I did not like that the server was crashing and the owner of ES did not seem to care so much for it so I agreed to buy it for $10k and keep it just like it was, absolutely ad-free. 

The owner (knight.mb) agreed to sell it to me with the stipulation that he would keep the name “endless-sphere.com”. So I went out looking for another domain. In my pursuit of looking for domain squatters I found Justin of ebikes.ca who was sitting on “ebike.com”. I asked him if he wanted to sell it and he asked “what for?” I told him about my plan to buy ES and I think he was interested in buying ES too.

Eventually, the owner at electricbike.com wrote me back and we came with an agreement for me to buy the domain name electricbike.com. I already made a verbal agreement to buy ES and now I had electricbike.com to sit it on. It seemed like a winning combo.

Anyway, disaster struck when Knightmb decided to sell ES to a 3rd party (not me or Justin). War ensued and Justin ended up buying out the 3rd party for a large amount of money and I was left holding electricbike.com as a super great domain that I did not feel good just squatting on.”

Now Eric was left with the domain Electricbike.com and nothing to do with it. He didn’t want to squat on it, so he decided that he’d put all of his hard earned ebike knowledge to use by creating a site for ebike information. He began with a goal of writing an article every two days (which by the way is an incredible pace that I could only dream to match!). He never intended to make any money off of the site, instead just trying to create something that would add to the world of ebike knowledge.

Writing kept him busy, but not so busy that he couldn’t still focus on what was becoming his main goal: creating an electric bicycle that could change the world. As Eric puts it, “I started my plan of making an electric fat bike back before anyone had thought of an electric fat bike. I am pretty sure I built the first electric fat bike ever.

It was during this time that Eric saw a change in the DIY ebike industry — a change for the worse.
“I was kind of let down with the industry. I did not think the big vendors I knew so well were doing anything to build the scene. Their prices seemed really inflated for goods anyone could buy on ebay, amazon or alibaba. I thought they needed a kick in the ass.  I am a true believer in the DIY scene, but in the 3-5 years time that I started electricbike.com I watched the scene go completely stagnant.  Store-bought bikes like the Sondors were becoming a better value than DIY bikes while a few years ago it was the opposite.

Suddenly I could not recommend DIY as the way to go and definitely could not whole-hardheartedly recommend a vendor. So I decided to become that vendor.” 

And thus Luna Cycle was born…

Alright, so it didn’t happen that simply.  Eric had actually spent the last three years continuing his new life-goal of bringing a world changing ebike to market. In designing and planning his bike, he went from vendor to vendor trying to find places he could order tens of parts for reasonable prices.

But the prices baffled him. Even as a manufacturer, he was quoted prices higher than if he simply bought from eBay. At those rates, his ebike would never be affordable. Basically, he didn’t want to be “one of those guys explaining why my ebike costs as much as a motorcycle.”

Eric felt that the DIY industry he loved so much was in trouble. “I thought that I could show those guys that offering fair prices is the way to go, and the only way this ebike thing is going to ever be mainstream.”

Eric is no stranger to entrepreneurism, having started both a chess instruction venture and one of the largest online vaping stores in the world. Starting a company wasn’t necessarily the hard part for Eric, rather it was the strategy. He already had an ebike website with huge traffic and considered opening an expanded store on the existing site to capitalize on that traffic. But Eric decided that if he was going to do something new, then it had to be completely new. Even so, it was a tough decision. “It was really scary going the lunacycle.com route.  It’s like owning a shopping mall and deciding instead to open your new store out in the desert somewhere.”

From the beginning, Eric knew he would have to innovate to stay alive. His goal was to offer good quality products at fair prices. But he had the rest of the industry breathing down his neck. He knew he’d have to take some risks in order to make it work. “I got lucky that I picked some products that held up well. I obviously gambled a lot with the BBSHD [a powerful mid-drive motor kit] and bought the entire first production run… and helped Bafang bring a high power product to the market that even they were afraid to sell.”

Eric’s reputation in the community helped Luna Cycle in its early days as well. “Many people knew me and trusted me as the editor of electricbike.com that I would stand behind this stuff and figure out a way to make it work.”

Throughout the tough work there were many motivating moments, but it wasn’t all sunshine either.

One of the things Eric is most thankful about, especially during the stressful early days of Luna Cycle, are his supportive customers. “I remember the weekend we opened, a customer came to my house and bought $3k worth of kits and batteries. I asked him how he found out about us and how could he just throw this kind of money down to a brand new seller? He said he had been reading our site for years and when he saw we opened a store he wanted to buy something right away and trusted what we sold.”

However, for all the goodwill Eric received from his customers, the opposite was in store for him courtesy of the big players in the industry. Out of everything, Eric says that this was perhaps the hardest part. He experienced a lot of nastiness from competitors, including people contacting his suppliers and trying to turn him into government agencies. “I was surprised by how much friction I got from competing dealers. I thought we are all in this together and should be working together. As a new guy we came in and were forced to follow the rules that nobody else was following because it felt like we had a target on our back. I felt like I was being bullied. Now it seems I am the big kid on the block and it’s a nice feeling.”

Luna Cycle is pushing forward with more offerings and improved products. Currently some of their soft-shell batteries are made in the US, but many of their hard packs are produced off-shore to Luna’s specifications. Eric wants to bring it all in-house so he can ensure the highest levels of quality control in the future. He even wants to eventually build his own battery cases and says that he’s making progress towards that goal. “We are buying heavy production machinery at a time when everyone else in the USA is selling. Its scary… but I think it’s the right course.”

Eric also wants to focus on customer support, one of the big differences between Luna Cycle and the plethora of inexpensive Asian competitors. When I asked him what else separates Luna Cycle from the rest of the pack, he wasn’t short on answers. According to Eric, Luna Cycle separates itself by “being as forthright as possible. By always bettering ourselves and what we offer. By moving fast and really trying to build on this industry rather than just ride it. By not just copying other people’s products [but instead] having our own ideas. By being out in the field with a machete defining the path rather than following someone else’s path.”

You’ll remember that Eric’s goal from the beginning was to introduce a world-changing ebike, and he says that Luna Cycle is still making progress on it. “We are actually working towards my dream of selling complete bikes. The parts are just a means to an end; the real goal is to bring fantastic bikes to market. Now we have all the parts to do it and are not reliant on anyone to get them.  And by complete bikes I do not mean conversion bikes, but our own bike that we build from the ground up here in the USA.”

When I asked Eric what was next on the horizon for Luna, he answered “I want to offer some bad ass bikes and I want to do a better job of making our own products that nobody else has. I have big plans for Luna. I don’t want to let our customers down who we owe so much too.  I want to come up with some amazing new products that really change the game.”

I want to leave you with one last interesting story about the founding of Luna, and how it almost didn’t happen. And since I don’t want to butcher it, I’m going to let Eric tell it in his own words.

“Electric bikes almost always just sapped my money, almost drove me bankrupt trying to bring my bike to market, getting all the parts and not being able to offer a complete bike. Well anyway ebikes always been something that cost me money not made money.  I started an online vape business wakeandvape.com that took off last year and we were killing it, quickly becoming industry leaders.  At the same time I was still working on sourcing batteries for my ebikes and flipping batteries via long email exchanges etc. I thought this is ridiculous, we are all set up for shipping and I got electricbike.com which was getting a lot of traffic, why don’t I have store on there?

All my vape friends thought I was crazy for having such a big site as electricibike.com and a store that was literally selling about 200 dollars a year in LED bike lights and j1772 connectors. I thought and thought about building a website but couldn’t make up my mind and didn’t know if it was a good idea so I kept procrastinating.  Also I didn’t want to fail and be laughed at by my buddies on ES.

Plus I was really busy with Vape. We were becoming one of the biggest online vape stores in the world and I was pretty focused on it.  So I just kept procrastinating. At one point I built an entire new store on electricbike.com and just chickened out and didn’t bring it live. I thought something is really wrong with me. It occurred to me that we had run a sucky store for more than a few years and it kind of wrecked electricbike.com as a store front so it was time to build something completely new.

I was really really scared about how to do it and if it would go over well or would it be just another ebike failure that would make me look bad. I didn’t know what people would think of me once I went commercial because the bike community who I love has this noncommercial ethic going. I never will forget how I would pace and think of it and just hit myself in the head and think ‘why is this so hard?’ It was a really big step into the unknown… and I really had no idea how it would go or which direction to go in. And in the meantime I am selling the hell out of vapes, something I don’t even like that much or believe in.

Well anyway one day the credit card company pulled the rug out from wake and vape and stopped paying us. I couldn’t believe it. Just one day our credit card payments stopped coming and we continued to sell waiting for them to release our money and they never did. We were guilty of processing too much, of being too successful too fast.  I thought no wonder its so hard to start an American business our banks really suck. They said we had become too high risk so they were gonna close our account and hold onto our money for 6 months, which a credit card company can legally do, to make sure we didn’t go bankrupt before giving us our money back.  By the time we got another processor lined up they had all our operating cash and brought a thriving business to its knees. I was shocked and depressed and really felt all our momentum was gone and did not have the energy to fight to survive. None of it seemed right.

After developing a multi-million dollar company we were on our knees… begging our families for loans for operating cash.

Well suddenly we had no money coming in and huge operating expenses since we were still taking orders and still shipping out. It was such a surreal situation. I was borrowing from everyone I could think of just to ship out our orders each day, it was insane.

So anyway I said I got all this money I have accumulated in ebike stuff including 150 fat bike cargo frames, a bunch of 18650 bare cells and battery packs that I have accumulated and been selling through email… wouldn’t it be great if we finally started a retail website for Luna Cycle and it could bail out Wake and Vape from this terrible crisis we were in?

So that was the kick in the butt I needed, and my fiancée Ashley and I stayed up all night on 4th of July weekend and built from scratch the retail website LunaCycle.com.

So when I started Luna Cycle it was kind of like a fire sale. We had the fire on our ass and we needed cash flow. Luna Cycle was the shot in the dark that people would find us and buy from a new vendor.

Luna Cycle came through and did just that.  It saved us instead of doing what you would think would happen in a situation like that which is drive us down further.

It was amazing…. Luna Cycle sold just enough to pay our shipping bills and keep Wake and Vape floating until we lined up a new vape credit card processor so that Wake and Vape could fly on its own again.

I thought that would be one hell of a story if electric bikes could save us, and it did.  I can’t tell you how thankful I am for that time last summer. What’s funny is if the banks wouldn’t have yanked the plug on Wake and Vape we probably would not have ever started Luna Cycle. We wouldn’t have had time or the inclination. I hated the banks at the time and considered taking bit coin or something, but now I have no hard feeling towards anyone because I am really happy that we started Luna.  I really really enjoy doing this.”

And it definitely shows.

Now go check out Luna Cycle and remember to be on the lookout for the impressive new complete ebikes they’re working on!