John Burke Builds a $1 Billion+ Global Bike Business from Waterloo, Wisconsin
Excerpted from Forbes
By Bruce Rogers
Like the legendary garage from which David Packard and Bill Hewlett built the mighty HP, the Burke family father and son team built a $1 billion-plus business out of a red barn in Waterloo, Wisconsin. From these humble beginnings would emerge a brand of similar iconic status to the bike racing world, making Waterloo the Silicon Valley of high-end and custom-built bicycles.
The idea for the bike company came from the realization that there were no high end bicycle manufacturers in the US. Everything at the time was imported. It was not the most auspicious beginning for a new business that most would say had little chance for success.
The company started in a barn in Waterloo (where it still remains), a small town of several thousand, just north of Madison, Wisconsin. And the company got off to a pretty good start, building some 900 bicycles in the first year.
“When I started at the company, I was a freshman in high school. And I’d go out to Trek and count inventory and other jobs,” says Burke. He then went to Boston University, discovered the joys of cycling himself and then returned to the business after graduating.
“At first, I was in charge of customer service, which I loved, because I could fix all the problems I had to contend with. Then my father came to the conclusion that he needed to change out the management. And at age 24, I was put in charge of sales and marketing at Trek, which, at that time, was doing around $16 million,” says Burke.
And then the business went international. That was a key part of Trek’s history. All of a sudden people started buying Trek in Europe,” says Burke.
Today the business does over $1 billion in sales, has some 2,000 employees with over 50 percent of the revenue coming from outside the U.S. They manufacture from a plant in Wisconsin that’s the headquarters. “We’re probably one of the last major companies to actually build bikes. So we build high end bikes in Waterloo,” says Burke.
What’s the future for Trek and the bike business?
“I think the next 20 years are going to be time for the bicycle. The bicycle sits at the intersection of environmental issues, health issues, congestion issues – three major problems in the world. And the bicycle is a simple solution. And you’re seeing more and more cities make investment in the bicycle infrastructure. From a company standpoint, we’ve got a lot done over the last 40 years. I think we’ve run a really good business today, for our customers, and for ourselves. But we can do a lot better,” says the ever-competitive Burke.