Kona Bicycles, the oldest and largest bike company headquartered in Whatcom County, has experienced some major shake-ups in recent years, but good news emerged in May.
Dan Gerhard and Jake Heilbron, who founded Kona in 1988, have purchased the company back from the equity-backed corporation they sold it to in January 2022. They say they’re focused on rebuilding relationships that have been damaged in the past two years under new ownership and getting back to bike industry basics.
Gerhard and Heilbron, along with Jimbo Holstrom, started the business in Vancouver, British Columbia, but soon realized they needed a presence in the U.S. where the biggest market was. They established their global headquarters and warehouse in Ferndale more than three decades ago.
Heilbron remembers a different Whatcom County.
“When we first set up there, it felt economically depressed,” he said. “There weren’t that many jobs other than Intalco and the refinery, the downtown was pretty quiet. The center of mountain biking was Marin County [in California] and Colorado. People weren’t thinking of mountain biking here.”
Heilbron said that the trails and logging roads of the Pacific Northwest have always influenced the kind of bikes that Kona designs. Bellingham and surrounding areas did eventually garner a reputation for excellent mountain biking, and with that came plenty of new residents, trail development, and even other bikes companies — Evil and Transition, both upstarts compared to Kona, now call Whatcom County home.
“It’s changed a lot, and is definitely less affordable, but not as bad as some places,” Heilbron said. “Downtown is vibrant, there isn’t massive urban sprawl, and it’s still a great place to ride bikes. Even on the road — motorists are pretty considerate here, and there are decent bike lanes, depending on where you are.”
Kona is best known for its mountain and cyclocross bikes, but also produces commuters, kids’ bikes, gravel bikes and e-bikes. In 2015, Kona opened a showroom on State Street in Bellingham to give customers a space to check out the brand’s considerable lineup (somewhere between 75 and 100 different models, depending on the year).
Kona has a history of supporting nonprofits, trail associations and youth cycling organizations, including local outfits such as Whatcom Mountain Bike Coalition (WMBC) and Vamos Outdoors Project. Most recently, the company sponsored the construction of a soon-to-be-opened dual slalom course on Galbraith Mountain.
“Kona has long been a supporter of the WMBC, going back to their national advocacy director who was our board president, and by leading trail projects throughout our community,” WMBC Executive Director Eric Brown wrote in an email.
The pandemic had a major impact on the bike industry. First, there was a buying frenzy as everyone realized the best way to spend time during COVID-19 was outside, on trails. Heilbron said as demand skyrocketed, he and Gerhard weren’t the right people to take the company to the next level, so in 2022 they sold it to Kent Outdoors, a watersports conglomerate that at the time was owned by the private equity firm Seawall. But by then the industry downturn had already started — manufacturing hold-ups, excessive orders and supply chain issues left many companies in debt, up to their eyeballs in inventory, or both.
The former owners stayed on through the sale in order to help the brand weather the headwinds, and watched as Kona hemorrhaged staff and made business decisions that fractured its relationships with dealers and suppliers.
During the upheaval, Kent Outdoors closed the Kona store in 2023, leaving nothing behind but the placard that still remains on the I-5 State Street exit sign. Fortunately, Jay Hiester, the owner of Tim’s Bike Shop in Everett, opened a second location where Kona had been, and rehired some of the staff from the former store.
Alarm bells started sounding in earnest when Kona advertised a buy-one-get-one bike sale late last year. By this spring, Kent Outdoors had reportedly been trying to offload Kona for some time, according to industry coverage. That culminated in an embarrassing moment in April when Kona employees were told by Kent to dismantle its vendor booth during the Sea Otter Classic in California, resulting in rumors Kent was about to shutter the company. The Sea Otter Classic is one of the biggest bike industry events in the country.
After the sale was announced on May 20, Kent Executive Chairman Lee Belitsky said in a news release that removing Kona from its brand portfolio “provides us with the ability to focus on and invest in our core growth brands, support key accounts and develop new outdoor products.”
News of the sale was met with cautious hopefulness across the bike industry.
“There was so much uncertainty about the future of the company for staff, especially after what happened at Sea Otter,” Heilbron said. “We’ve been hearing a lot of positive encouragement now that we’re back. We want to make things right with the staff, with customers, with our suppliers.”
Brown said that WMBC is glad to see Kona back in the hands of cyclists. “We’re all really looking forward to having Dan and Jake’s involvement in the community again and getting the Kona crew back out on the trails!”
Julia Tellman writes about civic issues and anything else that happens to cross her desk; contact her at juliatellman@cascadiadaily.com.
