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Kona Bicycle’s parent company appoints new CFO amidst fears of “cost-cutting measures” after brand pulled out of major cycle show at last minute

The move comes as the company is said to “pursue new opportunities”, after removing its stall from the Sea Otter Classic show in California one day before the event

After Kona Bikes staff were spotted taking down the brand’s stall at the Sea Otter Classic, a major bicycle industry expo on Wednesday, it has been reported that the Canadian bike brand’s owner has appointed a new chief financial officer (CFO) to “pursue new opportunities”.

Founded in 1988 in Vancouver, Kona is famous for its mountain and cyclocross bikes and was taken over by Canada-based sporting goods conglomerate Kent Outdoors in 2022. Bike Europe reports that yesterday, the parent company hired Rob Otto as Kona’s CFO.

Kent Executive Chairman Lee Belitsky, said: “He is an experienced leader who will help guide Kent as we actively pursue new opportunities.” He added that Otto’s ability to “rapidly interpret complex situations, formulate solutions and make sound decisions and possesses considerable experience implementing processes and business solutions that spur growth and improve operations and profitability.”

Otto joins Kent from previous CFO positions including RW Designs, Z Gallerie, Hudson Jeans, Seven For All Mankind, and Affliction Holdings. He said: “Kent possesses some of the most recognised names and brands in the industry, and it is my goal to ensure the company remains an industry leader while enhancing operational capacity and processes to ensure our facilities and people are operating at their peak.”

Bicycle Retailer and Industry News (BRAIN) was on the ground at the event in Monterey, California, which gets underway today, and saw the Kona display being set up before being taken down, amid rumours that employees have been told to expect a company “town hall” meeting yesterday.

Details of the meeting remain unknown at the time of reporting, however rumours of cost-cutting measures are high, according to Bike Europe.

road.cc has contacted Kona for comment, although it it not yet known what the topic of the meeting is. Earlier this month, five-time world solo 24-hour mountain bike champion Cory Wallace posted on Instagram to say that the Kona race team was going to be terminated.

While the stand was being taken down, a marketing specialist at the North American bike brand founded in 1988 told BRAIN that they would not be commenting on the matter.

"I can tell you straight away we are not going to have a comment," Caleb Smith reportedly said. It is believed the CEO of Kent Outdoors, the sporting goods company that bought Kona in 2022 from its founders Dan Gerhard, Jake Heilbron, and Jimbo Holmstrom, directed employees to pull the brand's presence from the expo. 

The news comes as Kona had yesterday unveiled its new full carbon gravel offering, the Ouroboros, which was due to be shown off at the brand's Sea Otter stand this week.

Kona Ouroboros

The line includes three builds — the Ouroboros CR, the Ouroboros CR-DL and the Ouroboros Supreme — Kona saying the new bikes will "catch the attention of both" mountain bikers and gravel fans.

"Pack it expertly for the long haul, nimbly explore the edges of singletrack, or complete multiple days of the most wonderfully weird and delightfully chaotic of events," Kona said in a press release announcing the new bikes. "While other gravel bikes may technically tolerate mountain bike components, the Ouroboros is intentionally designed around the rowdy stuff – like 180mm rotors, 2.1 tire clearance, and front suspension, giving you a ride feel that is otherworldly and almost mistakable for a modern trail bike."

Now part of Kent Outdoors' sporting goods portfolio alongside numerous outdoors brands, in 2022 it was communicated that the brand's founders would be staying on in their roles initially "to help a new generation of leaders at Kona guide our company to even greater heights".

One of the founders, Jake Heilbron, said at the time: "Kona remains committed to building great bikes, working with a rapidly growing network of independent bicycle retailers, and maintaining the Kona Way in everything we do. We're excited about the future and look forward to growing with the Kent family."

Earlier this month, Kona racing team rider Cory Wallace said it was and "unexpected goodbye to one hell of a ride", official notice having been given last November that the team would not be continuing.

Dan is the road.cc news editor and has spent the past four years writing stories and features, as well as (hopefully) keeping you entertained on the live blog. Having previously written about nearly every other sport under the sun for the Express, and the weird and wonderful world of non-league football for the Non-League Paper, Dan joined road.cc in 2020. Come the weekend you'll find him labouring up a hill, probably with a mouth full of jelly babies, or making a bonk-induced trip to a south of England petrol station... in search of more jelly babies.

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12 comments

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shiggy | 1 month ago
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Kent Outdoors is NOT a Canadian company. It was based in Ohio USA until moving to Utah.

a Google search brings up a firearms retailer, Kent Outdoors, in British Columbia that has no connection to Kona

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Tom_77 | 1 month ago
1 like

Had a Kona Blast sometime around the turn of the century, that was a pretty decent mountain bike for not much money.

Slightly more recently, I had a Dr Good. 7-speed hub gears with roller brake and a mechanical disc on the front. Once I'd added mudguards and a rack it was a very practical, low-maintenance commuter. Not sure if that's still sat in my brother's garage or if he sold it.

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galibiervelo | 1 month ago
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Love kona. Really hope they can escape the overstocking and progress into profitable sales.

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Rapha Nadal | 1 month ago
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I once had an Explosif in Reynolds 853 with their Project 2 fork and it was one of the best mountain bikes I've ever owned.  I still think about it today & do regret getting rid of it!

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ktache replied to Rapha Nadal | 1 month ago
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Id forgotten that I got a second hand set of project two's for my getting to work bike over twenty years back.

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ubercurmudgeon | 1 month ago
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I've had a couple of their bikes, and still got one. It'd be shame if it went under.

BTW, whatever happened to management buyouts? It seems like just a few years ago that, if a fundamentally sound company was struggling, having been merged into some ridiculous corporate structure, there'd be a good chance something could be salvaged. Maybe even set up as an employee-owned coop. Now it seems the shareholders would rather flog off the brand name for peanuts, as happened to Wiggle/CRC, than give it a chance for a resurgence. What has changed? Some financial rule change? Has management pay increased so much that they can afford to retire rather than take the risk of putting their own money in? Does nobody give a shit anymore? I guess if the products are made by subcontractors in the Far East, and the design and marketing departments all work from home, there isn't really a "factory" to save.

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cyclisto replied to ubercurmudgeon | 1 month ago
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ubercurmudgeon wrote:

...Has management pay increased so much that they can afford to retire rather than take the risk of putting their own money in? Does nobody give a shit anymore?...

I think this mostly.

Kona was run up to a few years ago, by people who had pedal strikes on their legs, had seen growing their bikes from hobby level to a world wide company. Now that they got old and sold it to others, who just want to see their wallet grow. If they close down, maybe some guys from China that know firsthand manufacturing pick up the brand name and revive it.

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cyclisto | 1 month ago
2 likes

Not a brand guy in general, but this is a company thinking out of the box, while avoiding being niche expensive. They threw good stuff on the market ahead of their time. They may be known for MTBs but they had very weird and very practical solutions for the road and commuters. I drooled over the Ute 15, even I know it would be too hilly in my area for it.

After all, which company would be equally bold enough to have a b***hole as their early days logo? Or name their bike Sex Too? A really cool brand, I hope new it stays on the market.

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Thelma Viaduct | 1 month ago
6 likes

1993 Konas are the best ever bikes.

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ktache replied to Thelma Viaduct | 1 month ago
1 like

The small frame, the aggressive posture, lots of standover height.

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grasen replied to Thelma Viaduct | 1 month ago
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are you a complete numpty???

it doesn't have disk brakes......

yes

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Patrick9-32 | 1 month ago
4 likes

Since Kona's rebirth after they kept the stinky for waaaay too long they have been one of the most consistently desireable mountain bike brands. If they are going under it highlights just how incredibly hard the bike market is right now!

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