FAQ--FIREITUP
Here are answers to some of the most frequently or intensely asked questions
over the years. If you have further questions, please review the remainder of
this website, or contact us and we will respond. Thank you.Okay, is there one most frequently asked question?
No, however each year does seem to bring it's own set of new questions. Certainly depends upon what period of time the company was in, and whether one was an ally or not. An interesting observation was a foe would make skeptical statements more than they would ask questions! Common statements were; "it can't be done, Harley won't let you make it, you'll never do it, you can't design a proprietary motor, no one's ever done this, etc..." However, among the allies, there was usually the beaming face and attitude, asking questions with both enthusiasm and sincerity: "how can I help, can I get a job with you, can I be your factory test rider, etc..." The energy givers were the ones we focused on.
Where did the word FIREITUP come from?
It seemed like every year we would have new questions or statements as we
solved the previous years. When we finally had the running proprietary
prototypes built, immediately the last question would disappear of; "you
can't design a motor," and instantly replaced with the next question or
statement. At the public unveilings in Sturgis and Daytona Beach, prospective
customers would come up to the bikes, and state; "fire it up!"
We heard it so much it became a mantra, and we adopted it in the field, and soon
made t-shirts proclaiming it. Of course we did, "fire it up," as our
Road Crew sales staff was very obliging.
How did the company get started?
The spark that started it all began at a Christmas gathering in Dec. 1992 when
various members of the Hanlon Family were gathered at the Hanlon Family farm in
Derrynane Township, Belle Plaine, MN. There was a current attempt at reviving
the Indian motorcycle marque, and brother Tom had the paperwork and was
contemplating putting a down payment on a prospective new Indian motorcycle. Tom
provided the paperwork to brother Dan to take and review--and shortly thereafter
upon Dan's research of the current attempt, the industry and consumer
enthusiasm, market forces, and improvement in the financial markets--decided
indeed there was an opportunity for a new USA motorcycle entrant, but possibly
not only Indian, but another American brand. So, Tom did not put money down on
the Indian, and instead ultimately became one of the early investors in another
new motorcycle company, Hanlon Manufacturing Company. So began the spark that
led to further action, and the lives of some of the Hanlons would never be the
same.
What's the story on the book, Riding The American Dream?
When the business was launched ultimately from the spark mentioned above, it was
never expected to garner so much media attention. With any popular story, most
frequently there are stories of fact and folklore that get told and retold,
without ever really knowing what the real story is. Oftentimes, the truth is
more interesting than the fiction! This book chronicles the concept from startup
and post-production as written first-hand by Dan Hanlon. With the
intense amount of media frenzy surrounding the company, there were many myths
and folklore created--some by the company itself--that this book is designed to
clarify the inside facts, recognizing some of the information may not be
popularly viewed. If you have not read the book, it is highly recommended for
the EH aficionado, even if you are not a book reader. It will answer many
questions--all of the FAQs mentioned here are addressed in the book--and provide
answers to questions you didn't know you had. Over 400 pages, so there is a lot
of information.
Tell me a little more about the start of the company?
All of this is chronicled in the book Riding The American Dream, and the short
story is, after the spark of 1992, most of 1993 was invested in drafting and
perfecting the business plan, initiating contacts in the industry, and market
research. Dan had previously sold a company he started earlier, and devoted
full-time efforts to the venture. A venture such as this does not begin without
a significant investment of time and capital to ascertain a correct plan that
can be implemented with a likelihood to succeed. After exhausting all research,
a decision had to made of either implementing the plan, or shelving it. The
decision was made to launch and motorcycling history would soon have a new
entrant...
How did Hanlon Manufacturing fit into all this?
During the research and development of the business plan since early 1993, the
company name used was Hanlon Manufacturing (initially a sole proprietor). Upon
the decision to implement the plan, the next stages required investor financing,
lease agreements, filing trademark applications, design contracts, etc...all
requiring the execution of legal documents. The name was subsequently
incorporated in December 1993 to facilitate the legal process, and all shares
were issued to Dan Hanlon, as the founder and CEO. Dan provided a loan
to the company of $50,000 from his savings. At this point most of the company's
actions were proprietary in nature--not publicly disclosed--and the use of this
name allowed the company to operate without distraction to the motorcycle brands
it ultimately intended to design, produce and market. The mission and principles
were created in the basement of the founder's home prior to the incorporation of
the company, as this set the tone for the future. The name Hanlon Manufacturing
Company would stay in place for several years until the spring of 1996, when the
legal name of Excelsior-Henderson Motorcycle Manufacturing Company was formally
adopted.
How many Hanlons were involved with the company?
Quite a few. The Hanlons are a large supportive family of gearheads and business
minded folks, considering they all had an upbringing on the small family dairy
farm that had been in the family since the mid 1860s. Many have post-secondary
education and advanced degrees, and either own or have owned their own
businesses. Of the eight siblings, many were early or later investors, and all
lost their investment in the company--universally this is not a shared good
feeling. Several family members used their Harley-Davidsons as collateral on
loans to buy stock. Their parents, Jerry & Mary, invested a significant part of
their life savings and lost it all. Whether directly involved as an employee,
shareholder, or enthusiast, there was a lot of Hanlon family involvement.
How about the Hanlons that were employees?
A great quote; "The reality is that 'entrepreneur' is not a job title. It is
the state of mind of people who want to alter the future," is from Guy
Kawasaki. With that said, the Hanlon's never considered themselves as employees, but
entrepreneurs responsible for implementing the plan. Dan's
brother Dave was recruited to join in early 1994 and the company began marketing an additional founder (to position
against Harley-Davidson having a family of brothers as founders). Three years
later, Dave was appointed co-CEO just prior to the public offering in mid-1997.
Dave's wife Jennie joined the company part-time in 1994, and grew into a full-time role.
In the spring of 1998, the company decided to bestow upon
her a founder status as it was believed a woman in that role would be helpful
strategic market positioning, which was marketed going forward. Terry Hanlon,
another brother, was an early volunteer, part-time employee, and later full-time
employee and was the lead factory test rider. He was involved with the company
in one facet or another since before the legal inception. Other siblings and
children had various roles in either part-time or volunteer status. In either event, there were
many Hanlon family members involved in the Excelsior-Henderson Hanlon-led revival.
What about the story that the company started on a hotel balcony in
Sturgis?
It's a great story, and true that it's a story. Several Hanlon brothers, family,
and friends rode together to the Sturgis motorcycle rally in 1992. For Dan, Tom,
and Terry it was the first ride together to Sturgis with brother Dave and his
wife Jennie, who had been going to Sturgis for many years. Several evenings
while at the rally, the group would gather on the hotel balcony enjoying
refreshments and the sights and sounds--if you've been to Deadwood/Sturgis, you
know what it's about. Brother Dan was primarily going to research the wooden-engine
Indian motorcycle unveiling (again see the book Riding The American Dream) as
part of the due diligence of the Hanlon Manufacturing business plan. Later,
when Dave joined the company, the balcony story was enhanced and promoted.
Certainly, it was no secret among the Hanlon brothers what was being
nurtured, and Dan would share his ideas with others and was discussed among the
close internal group while at the rally, and on a hotel balcony. So, the hotel
balcony story has a familiar ring, just with a twist of the marketing throttle,
which is in part, what makes for great marketing, which motorcycle companies are
prone to do!
So, what's the connection to Jay Leno?
Jay was an early supporter and enthusiast and became a friend to the family and
company. Anyone who knows about Jay, knows he is an ardent motorsports
enthusiast and continues to increase over the years. Just prior to the decision
to launch the company, the founder received his copy of the current issue of the
Harley-Davidson The Enthusiast magazine (Fall Issue 1993--if anyone has an original
copy of that issue, please contact Dan H.). The front cover was depicting a
Harley-Davidson ride with Jay Leno leading the HD riders on an old motorcycle.
Upon close inspection of the cover photo, it revealed that Jay was leading the
riders astride his very own old Henderson Four motorcycle! What a coup, having
Jay Leno leading the HD riders on his Excelsior-Henderson! The invincible HD had
a marketing chink-in-its-armor. Dan sincerely took that as a sign from above in
many respects, and so sparked what would later become a connection to one of the
world's most foremost motorsports enthusiast.
Why didn't you start smaller?
This is a common question, and there simply is no way to start a proprietary OEM
manufacturer in a smaller capacity. The sheer nature of this question indicates
the questioner does not understand the proprietary principles of manufacturing.
EH by design was the smallest OEM manufacturer, and most likely would have
remained so. A proprietary OEM is a big venture, as the key words are
proprietary and OEM. Defined, proprietary means uniquely designed, engineered,
and produced motorcycle, which primarily consists of proprietary main components
of an engine, frame, fenders, fuel tank, look, etc... OEM meaning adhering to
the Federally mandated EPA, DOT, and internal testing controls, development of a
Rider's Manual, etc... We did start small by launching with one person, but in
order to succeed in building the company, we had to volume produce motorcycles.
Why did you have to volume produce motorcycles, why not just a few
and grow from there?
This is really the same question about starting smaller, as the answer is the
same--OEM and proprietary determined the size of the company launch--it's a
mathematical formula to calculate a return on investment. This is covered in
greater detail in the RTAD (Riding The American Dream, Chapter 16) book, however
to summarize, the axiom of manufacturing is you need volume to lower costs. If
you have low volume, you have high costs, and vice versa. Now add the
proprietary to the mix, and that further complicates the cost structure as new
tooling needs to be made. In general, in order to recover the upfront costs of
design, tooling, testing, etc...you need to produce thousands of parts to recoup
the cost. This is simply a mathematical equation and has been around as long as
manufacturing has--and if you understand manufacturing you already know this.
This is also why you do not see proprietary, independent OEM motorsports
startups. To build a few bikes at a time would require hand tooling and hand
building--much like anything custom--and the price each would have been in the
$60,000 to $90,000 price range...unaffordable and would have been a planned
failure. It has been stated, Excelsior-Henderson may have been the last
independent, proprietary OEM startup witnessed in our lifetimes.
Well, then why did you need to be an OEM and proprietary?
Proprietary means developing your own products, not copying someone else and not
using someone else's parts. Very difficult to use someone else's components to
make your product, unless you get permission from them, and if you do, then
basically you have the same product as everyone else, and they control your
pricing, quality control, etc...and all you are is a clone, and no product or
marketing value. There would be nothing unique hence there would be no real
company to build. All vehicle manufacturing companies such as Harley-Davidson,
Honda, Ford, Chrysler, Toyota, etc...are proprietary OEMs building motorsports
vehicles using their own designs and parts. They may share some common features
(generally consumables) such as spark plugs, tires, oil, fuses, etc....
Why not use someone else's engine and frame?
Okay, by now you might be realizing if a company used someone else's engine and
frame, fuel tanks, etc...then they do not have an OEM proprietary motorcycle,
but instead have a clone of anyone else. First, most motorcycle manufacturing
companies have their own engines, and they're not going to sell you their engine
to another company to compete alongside. Doesn't make business or economic
sense. In addition, at the time of incorporation of the company, there were no
complete aftermarket air-cooled v-twin engines being made (S&S did not have
complete motors yet). Even if they had, the company would have needed to use
it's own engine, again otherwise it would simply be a clone of the many other
aftermarket motorcycles that became available.
Okay, I think I understand the OEM and proprietary part. Why did you
build the Taj Mahal?
This one is funny. There was periodically a media frenzy and some just couldn't
resist creating myths to manipulate their readers and try to discourage the
company. A couple of media journalists had a lot of fun criticizing and
demonizing the efforts of the company, and some were fond of ridiculing the
factory and called it the Taj Mahal. Most of us wouldn't even know what that
means. This is covered in great detail in the Riding The American Dream book,
however the short story is the factory was built frugally (less per square foot
than the local Wal-Mart) but did have a nice distinctive look. Additionally, you
may recall during the go-go mid 1990s, there were no vacant factory buildings
available in the seven county metro area of Minneapolis and St. Paul. The media
journalists were simply wrong and apparently had some other agenda or
motivation. On a private note, if you ever have the chance to visit the Taj
Mahal, it is in India and was constructed over a 21 year timeframe beginning in
1632, and is considered one of the great marvels of all time. Maybe the
journalists were right, but not in the way they intended!
What do you think of the media coverage?
Many media in the print, radio, and television enjoyed covering our company,
although a few may not have appreciated our efforts. There had not been a
previously successful motorcycle company launch to chronicle, and some were not
sure what to make of the company, as most motorcycle journalists simply focus on
the end result of a motorcycle, and it took several years for the company to get
into production. Approximately 90% of the media coverage was outside the state
of Minnesota, and was mostly favorable and balanced, except for a few.
Internationally, the company received great media coverage. Locally, there were
a few journalists that were interested in fabricating stories and causing
consumer mis-perception. For the most part, the media coverage was fantastic and
we very much appreciated their interest and support.
Why do you think some journalists were and still are unfavorable on
the Hanlons or the company?
Not sure, and good question. If you ever have a good answer please contact us.
There was a writer in Canada that took a particularly harsh position against the
Hanlons, and one in particular. Years later the founder had a chance to converse
with that writer, and asked why he was so harsh on the company, the Hanlons, and
particularly one of his brothers? The journalist was surprised (pleasantly),
didn't recall the article, and apologized, stating, "I write so many
articles and then just move on. I really don't remember what I wrote, and I'm
sorry if it affected your family. I think you guys were doing a wonderful job!"
Wow. Now that's different, and better late than never.
What do you think of the Victory and Indian motorcycle startups?
Congratulations to them both on determining to enter a difficult industry with
great barriers to entry. Excelsior-Henderson invested approximately $95 million,
which includes $11 million for a new factory and $8 million for a finishing
facility, whereas Indian invested approx. $240 million before succumbing to the
forces of the market and didn't require building a factory or finishing
facility. The Polaris Victory motorcycle project has invested nearly $200
million and also did not construct new facilities--it is widely known that
without a profitable, patient, corporate parent, the Victory motorcycle line would
be shuttered...it has not met it's production and sales goals. With the passage
of time, the accomplishments of the Excelsior-Henderson motorcycle venture are
better validated.
Where did names like the Road Crew, Pioneer Dealers, Riders Handbook
originate?
Part of the corporate culture of EH is to first break all the rules, then
rewrite to our rulebook. The company was entering a century-old industry
dominated by corporate goliaths that had written the rulebook and controlled the
industry. It was the company's goal to not follow by the rules others had
written, so in every respect possible, we chose a different path to mark who we
are; Road Crew rather than employees, a Riders Handbook rather than Owners Manual, etc... You
will see this in many facets of the company, and was part of our corporate
culture.
Tell me more about the Road Crew?
The maximum employment the company had is approximately 240 positions
during mid 1999. With attrition factored in, over an eight-year
timeperiod, there were approximately 275 people that comprised the Road Crew.
Many of them today remain in contact with one another, and continue to progress
in their respective careers. Some remain in the motorsports industry, achieving
such titles as manager, director, vice-president, and president. The former
Senior VP of manufacturing and engineering for EH is the head of Victory
motorcycles production since EH ceased production--little wonder the Victory has
improved! EH's lead designer is employed with Harley-Davidson in their design
department. These are just a few of the many examples. Congratulations to all
the Road Crew for their dedicated efforts in joining a company that was
undercapitalized and for committing their valuable time and energy to build the
company. Collectively, it was the most skilled team-driven force that many have
worked with, and most likely will not be duplicated.
What are the mission and principles?
You will find them in the arrow Document Warehouse of this website. Every Road
Crew member was presented with a small card preprinted on both sides with the
Mission and Mission Principles. The company sought to operate by this vision and
values, and designed them to be timeless--to transcend time to be effective 100
years into the future or 100 years into the past. In short, the company Mission
is to design/build/sell profitably, legendary American motorcycles throughout
the world. There are nine Principles the company fostered, the first two: (1)
People are our greatest asset, and (2) We will work as a team.
Why did the company go public so soon (while in
negative cash flow)?
It is not desirable to go public while a company is in negative cash flow as the
nuances of the public investment marketplace likes predictable, stable, positive
cash flow companies. That the company was able to go public nearly two years
prior to revenue is a real testament to the management team and investment
group. There was a financing event that occurred in 1996 that would require the
company to become a trading stock within 18 months, so there was a trigger on
the company. This trigger was created by a media event, wherein the company was
in the midst of a $10 million private placement of stock, utilizing the SEC
exemption from registration and adhering to the no solicitation rule. While the
company was conducting the kickoff presentation to the brokers, an errant
newspaper reporter tricked the receptionist into providing him a copy of the
confidential document, in which he promptly wrote an article--which could then
be deemed to blow our SEC registration exemption. We had to cancel the $10
million offering, and put the company into a pre-measured stall position. We
re-wrote and reconfigured the offering, and later embarked on a private offering
of registered stock that had a pre-determined lockup on the investors. A
complicated deal, that with a bright and capable team, was able to execute and
live to fight another day, knowing there was a loaded gun and trigger in the
not-to-distant future.
What's the one reason the company shut down
production?
There is no "one" reason--although it seems some believe there should be--and there are many factors that came together to
create the perfect storm. The trigger mentioned above did not help either.
The short story is the financial markets had changed dramatically in support of
Y2K and the burgeoning internet boom, creating an environment where bricks
and mortar were no longer in favor--and early stage investors abandoned the
company in search of promising internet startups--remember the term clicks and mortar...now long forgotten. The company was not able to
secure additional funding on any terms. Certainly there were some internal
operational issues and external factors too. The internal issues were standard
operating items that would get sorted out in time, and were not leading factors.
Remember in the 1999-2000 timeframe how billions were invested into internet
startups, and on some occasions with little more than a plan on a paper napkin?
There were many indirect business casualties, and EH among them since the
company by plan was not yet in positive cash flow. Had the company been in
positive cash flow, then the outcome may have been improved...
Well, did Excelsior-Henderson fail, and/or is it a failure?
The company certainly had a lot of successes since its inception, and achieving
a high quality proprietary OEM motorcycle...that years later has continually
come to be recognized by the industry as one of the most modern and unique
motorcycles ever built. With the dual-overhead cam, four-valve, fuel injected
motor and unique anti-dive front suspension, and rigid low slung frames, the
motorcycles are standing the test of time. Measured by one day--December 21,
1999 when the company halted production--then yes. Measured before and after,
the company legacy continues to ride... My apologies to all those who
invested in the dream, and lost.
"To try and fail is at least to learn. To fail to try is to suffer the loss of what might have been." --Benjamin Franklin
Ride to the top...
