Case file 006 · Lynskey Bicycles
How a $6.6M Bike Company Ended Up in Bankruptcy
A family that welds titanium bikes by hand filed for bankruptcy owing about 200 customers $650,000.
The numbers
The story in 30 seconds
Having built and sold one titanium bike company, the family started Lynskey in 2006 on price: frames welded by hand in Tennessee for far less than other American builders charge. Unless they financed, customers paid in full at checkout, then waited for the shop to build the bike.
Deeper sales, up to 50% off, brought cash in today and sold tomorrow's bikes at a thinner margin. Short of cash, the shop couldn't buy parts; late bikes brought chargebacks and held payments, leaving even less for parts.
On Apr 30, 2026, the company filed for Chapter 11, owing about 200 customers roughly $650,000, with $78,500 in cash. The shop is still open and still welding, and until Dec 31 the next move is theirs alone.
Follow the $100
Every $100 the shop owed customers when it filed:
Not in the bank: ≈ $88
already spent running the shop, by my reading
In the bank: ≈ $12
and the bank has first claim on the building and everything else the shop owns
our arithmetic
What this means for your business
- 1
Take less up front.
Try thisSet a deposit that holds the order but can't fund your payroll. Two of Lynskey's peers ask $1,000, and a third asks $2,500 on a $6,695 bike.
- 2
Let the price pay for the work, not the deposit.
Try thisCheck that the margin on your last job buys the materials for the next one. If it doesn't, look at the price before the deposit.
- 3
Sell what you can ship, and say when.
Try thisPut up a list of what's ready now and the date the rest will be. Lead with the part you make yourself.
More plays from the video
- Never use a new customer's money to finish an old customer's order.
- Every half-price sale is a promise to buy full-price parts.
- Know what your building is worth against what you owe on it. Selling it is a trade, not free money.
- When a payment company starts holding your money, the checkout is the smoke alarm, not the fire.
How you compare
Lynskey's margin on the last bike had to buy the parts for the next one. Two shops from the 40 that buy parts for every job:
About 10.8¢ of every sales dollar ends up as the owner's own pay. our arithmetic
About 25.6¢ of every sales dollar is left at the brand's own centers, before debt payments.
Run your numbers
If customers pay you before you deliver, do this tonight.
If the first number is bigger and the gap isn't sitting in materials for their jobs, you're running on their money.
