Private equity is a dirty set of words for many, as it means the likelihood of worse quality products, failure to invest properly in a company, layoffs, and the eventual death knell of said brand. We've seen it time and time again, as venture capital raises a ton of money, buys a company for an inflated sum, immediately cuts headcounts, and in two years time, sells the husk of the company for pennies on the dollar, leaving everyone out in the cold who'd given their blood, sweat, and years for something great.
And that's the accusation that's been placed at the feet of Dainese, the motorcycle safety and gear brand, after being bought by a consortium of private equity giants, including everyone's favorite bad guy, BlackRock.
Head to the comments sections of this very site, along with countless others, forums, and Reddit threads discussing the sale at the time and you'll find prognostications of Dainese's soon-to-be-death. And even in our original reporting on the sale, we were pretty doom and gloom, though you could hardly blame us, as most of RideApart's staff have been on the receiving end of PE ownership at one point or another.
Dainese's CEO Angel Sanchez, however, believes otherwise. The veteran executive and motorcycle fanatic is bullish on the acquisition. In fact, he told RideApart that this sale was the best thing that could've happened to Dainese. And that Dainese isn't just resting on laurels as it reshuffles after the sale, but pushing the boundaries further to heights we've yet to see. He even teased us with news that Dainese would be changing the game.
Big talk, but earnestly so. Here's what he had to say in our exclusive interview.
RideApart: There's been a lot of talk about the sale, so tell me how you at Dainese see it, how this private equity sale works for you, because you were sold not too long ago, too. 2022, I believe was when you guys got sold to Carlisle for 690 million, $692 million. Tell me why this is a good thing, why this is a bad thing, why people should be worried or not worried.
Angel Sanchez: Well, first of all, I tell you, I joined Dainese in November 2023, so I wasn't there in all those passages. But for Dainese, it's an amazing thing. For Dainese as a company and for our Dainese users, it's the best thing we can have at this time. I mean, we've been working very hard to make it happen. Why am I saying this? Because now we have a solid company with a solid financial structure, with capital, with cash in the bank as we've never had, and with the partners that know the business because they've been with us for already three, four years, since 2022. They know the business, they know what they expect. They've seen the business plan of the company and they believe in it. So they are buying this company; they bought into this project because they believe in the potential that we have as a company. And now starting from a different price space, as you were mentioning, it's a great opportunity.
For Dainese, the employees, and our riders, it is the best thing that could happen to us.
RA: I mean, private equity is a dirty word for most people, just because it tends to be “they buy it for a high price, they strip it for parts, and the product gets worse.” What are the safeguards that Dainese has put in place so that doesn't occur that people keep their jobs, that people ... I have a bunch of Dainese stuff. I like the products. What are the safeguards to ensure that those products from AGV to Dainese stay as good as they can possibly be?
AS: No, no, no. They're not going to stay [the same]. They are going to improve significantly. Significantly. I'm happy to talk about it. Listen, the key to me, it may be to simple, but it is that they bought a business plan and we have committed to a business plan and we have agreed in objectives and plans for everybody based on this business plan. And this is a business plan of growth.
There is not any intention whatsoever of splitting it, selling in pieces, closing down things, reducing quality. I mean, no way. I mean, the only way this company is going to be better is by growing and is by improving its products. You know the company, you know more than me, maybe. Dainese has invented everything in this industry.
Over the last short period, it's been in sale for too long of a period. It started before COVID, then COVID came in, then they started selling it again after COVID. So there's been a little bit of attention deviated over this period. And we slot a little bit the punch go back. I mean, it's something that is in the DNA of the people. And this year we are coming with all the new collection, all the new products, like always. We're bringing some new helmets, but we are coming with three disruptive innovations as Dainese used to do.
We're going to move the market. It's the way. I mean, we are going to win if we are able to keep the innovation path the way it used to be.
RA: So you talk about the business plan. Talk to me a little bit about it. You said long-term growth. That's the goal for most companies. Are we talking a 5-to-10-year plan or a 10-to-15-year plan? Because the market...
AS: A five-year plan. We have a five-year plan.
That implies a significant recovery in terms of sales, significant growth in several markets. I mean, it's like all the plans, it's important what you do, but it's important what you do not do. So it's clear where we are focusing in terms of markets, channels, brands, and products. And this is what we are trying to aim to do in the coming five years. Then we'll see from there. In two years' time, we'll do another five-year plan. But that's the way it works. I mean, thinking more far away becomes a dream. We have concrete actions to get there now.
RA: Can you talk about a little bit of those concrete actions or is that still a little too much, too early?
AS: Well, I mean, in terms of channels, we are clearly pushing forward with keeping the relationship we have with our distribution partner, our wholesalers. There was a past in which a company aimed to do everything by itself. We don't believe it's the way forward.
Of course, we will keep our direct channels because they are great for us. They give us a lot of information on consumers. We get firsthand, we know where the products go, they don't go, what are the things to improve. So it's super important for us. And they also allow us to present our brand in the way we want, but this is not the way to grow. The way to grow is to keep growing with our wholesale partners, and this is pretty clear. In terms of areas for growth, clearly Europe is our biggest market, and it's very important. But the US and the Americas are becoming a huge opportunity for us, and we are doing significantly better there, and there are many, many potentials.
And then in terms of products, it's clearly that we are focusing on motorbike with all the categories, but the clear focus is motorbike and the key to brands is AGV and Dainese.
RA: What have you seen with those talks with wholesalers, with those talks with your partners and your dealership partners, what have you seen as the driver in the market? Because the market right now is kind of screwy, both in terms of economic forces, tariff forces, but also it's the pendulum swing of riders of what is hot right now. So for a long time, it was middleweight adventure bikes. Before that, it was sport bikes. What has Dainese seen and AGV seen as the market forces within the last two, three years as we come out of COVID?
AS: Well, let's say in terms of sector, as you saw it, adventure touring, sport touring is growing significantly. It's the biggest sector right now, even though sports has been very important for us. But the way we look into it is that we indeed are here to save lives, and this is our mission. Of course, we do products, we sell the products and everything, but we keep asking "What can we do to improve life's quality?" I mean, to save lives or to avoid injuries for those people who take a bike and risk and while trying to enjoy.
So we are trying to see our way forward in bringing innovation that matters.
I told you, I mean, I cannot tell you exactly what we are going to present, as you may understand, okay? But I can try to tell you a little bit. I mean, we are presenting a couple of things before summer and there will be another significant improvement after summer. We are going to bring a helmet for AGV that is going to make all the other helmets look like they're all the day after. You're going to have to throw all the ones that you have behind you away. You're going to go back to buy our new helmets because it will have an increased level of protection.
I mean, we are going to bring something in June, so I'm not telling you three years from now. I have it ready. Okay? I just can't show it to you.
RA: [Laughs] "It's right here, but I can't show you!"
AS: Exactly. No, I have it in the backpack, to be honest. [Laughs] Yes, it's right here.
But we are going to bring something which is going to make many more people ride safer. Because the pro, he wants to have everything and wants to be, he understands the risk he's taking. There are many people who go on a bike, and they use a helmet. Sometimes they even have gloves. So we, as I said, as part of our commission, we want to provide better security to those guys. We want to bring in something that is going to change the industry. I can tell you, we've presented already to some wholesalers and mind... mind-blowing.
This is the way forward. We need to do more good products, but we need to bring new steam to the business to make it grow and to make it broader so that everybody can get and ride safely.
RA: That's an interesting way forward. You don't hear that from folks who have been bought by private equity; it usually goes the opposite way. So it's an intriguing assessment of the company. It's just like, "No, no, no, no, we're going to double down on the innovation side of things. Usually it's we're going to cut 300 people."
AS: Listen, I can tell you, in the last two years since I'm here, we've had the highest R&D innovation budget in the history of the company. That is why we are coming out with those products. I mean, if you do not invest, they don't happen by hazard. But it's a lot of heavy work. We have a great team. We have even created within Dainese a special team, which is called Demo Lab, that they are working in projects that will see the light in five years from now.
So maybe the current investor will not even see the result of that, but we want to thrive through innovation in this company.
RA: There’s been a lot of talk online about the sale, about the future of Dainese. Aside from the new technology, the safety innovations that are coming out, that Dainese is investing in its future, what do you want to say folks as a last line of just like, "This is the flag that we're planting in the soil." What do you want them to know to alleviate those fears?
AS: Well, Dainese is back. I mean, we've been through a difficult period and it's true. I mean, no way to deny it, but it's over. Listen, the moment we signed this thing, I was reborn personally. Seeing that we can go back to competition, we can go back to the fight with all the weapons we've been preparing, it's vital for us. I mean, this financial period is over. It's done. It's done.
We've been managing the company in the last years, looking to the market, but looking to the bank whether we have or not the money to do the things that we wanted to do. Now it's not that money is flowing, it is running down and we can do whatever we want, but we are in normal conditions so we have a new playground. I mean, we are back.
