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MailTribune.com
  • Brammo's bikes go global

    Singapore deal is a signal Ashland motorcycle firm won't be a large-scale Rogue Valley manufacturer
  • Craig Bramscher is feeling pretty good these days about the future of Brammo Inc.
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  • Craig Bramscher is feeling pretty good these days about the future of Brammo Inc.
    The electric motorcycle company he founded acquired another $12.4 million from investors in a private offering last week and most of the remaining $17.5 million worth of shares it intends to sell are spoken for.
    "The goal is to have it all wrapped up within two months," said Bramscher, who also signed a deal last week with global electronics manufacturer Flextronics of Singapore to build the bikes. "We're looking for the best fit right now. I don't want to sound cocky, but it's very hard in this market, or any other market, to start up an electric vehicle company."
    The Flextronics deal, however, is a signal that despite the infusion of money, Brammo's Rogue Valley operation will not turn into a large-scale manufacturing employer.
    "We will build here for a little while, but we won't be a high volume manufacturer in Ashland," Bramscher said. "Initially, we thought we'd be just U.S.-based. Now it's clear the demand is global for our products and we're trying to respond quickly, efficiently and cost-effectively. But our global headquarters, research and development, design, marketing, sales and administration will be here."
    Some have compared Brammo's emergence with Tesla, a Palo Alto, Calif., electric car builder that recently completed its initial public stock offering. Tesla has produced high-end roadsters for celebrities, but is banking on a $50,000 Model S sedan that won't go into production for another year at a former Toyota plant across the bay in Fremont.
    Bramscher sees an economic parallel between the firms, in that Tesla was founded in 2003 and now operates as a public company. "Tesla is a start-up that went public and that's the part we are trying to follow as well," he said. "But we're an electric pure-play, our entire focus is on an electrical vehicle — not like GM, a company that does it all."
    Unlike Tesla's Model S plans, most of Brammo's manufacturing will be done overseas. That might disappoint those who thought Brammo's success would be an employment breakthrough for the region. But Bramscher said the same convictions that led to the development of a nonpolluting bike led to the decision to manufacture the majority of the Enertia and Empulse motorcycles on other continents.
    "If we are going to be a sustainable company — like the whole-food production thing where you know where the food came from — the closer you can build to consumption the better it is as far as carbon footprint," Bramscher said. "That's why we will manufacture in North America for North America, in Asia for Asia and in Europe for Europe."
    Last week's $12.4 million private investment differed from a general initial public offering of shares because the company selectively chose investors, not only for their money but because of their connections. "You have to be an accredited investor, a professional at some level," Bramscher said. "There are individuals at some level, but they are savvy investors. Money is a part of it, but we're looking for someone to bring expertise or access to other markets, or expertise in other markets such as Asia, Europe or fleet sales."
    Chrysalix, an energy-focused venture capital firm in Vancouver, British Columbia, and Best Buy Capital, which together backed the company with $10 million two years ago, were joined in this round by Alpine Inc., an Edmond, Okla., gas and oil exploration investment group. Another investor participated, but Bramscher said a nondisclosure agreement prevented him from naming the organization.
    "Our original goal was to raise $100 million," Bramscher said. "We're planning on going profitable soon. This is only the second round (of investment), but we're hoping this will get us there."
    Bramscher said the company will put the proceeds from the private offering into research and development; production, staff and working capital.
    "Even though it sounds like a pretty big number," he said. "In the motorcycle world it's not that much. It's not like we're going out and buying Super Bowl ads and becoming like GoDaddy."
    Reach reporter Greg Stiles at 541-776-4463 or e-mail business@mailtribune.com.
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