(By: James Ranson, Urban Cycling Institute, University of Amsterdam)

From renting a handful of bikes out of a tiny garage in the charming South Holland city of Delft, to the biggest bicycle owner in Amsterdam, Swapfiets’ meteoric rise and simple concept has impressed and confounded in equal measure.

In a world awash with multinational share bike operators dispatching bike fleets in their thousands to cities around the world, how did three young entrepreneurs and a dash of Dutch steeliness collar the local market?

After conceiving the idea in late 2014 during their studies at Delft University of Technology, Richard Burger and co-founders Martijn Obers and Dirk de Bruijn posted 40 second-hand bikes on the Dutch version of eBay, Marktplaats. Within a couple of months, after plenty of elbow grease, that number had become 150. Soon, 200 customers were waiting before the trio had time to fully develop the concept. At this point Steven Uitentuis joined as the fourth architect fuelling the Swapfiets concept.

After filling racks with blue tyres in smaller cities around the Netherlands, including Delft, Nijmegen and Utrecht, Burger set his sights on Amsterdam, Germany and Belgium.

The rest is history. Now, you can hardly turn a corner onto one of Amsterdam’s famous canals without seeing the iconic Swapfiets blue front wheel. With Swapfiets’ subscriber base of nearly 30,000 (5,000 in Amsterdam) built almost entirely on a platform of word-of-mouth marketing, Burger said it has been the visibility that has most astounded him.

“I mean it's not an application on your phone or something like that, it's a physical object with a blue tyre so if you're in the north of the Netherlands, in Groningen or in Delft or in Leiden, and you see 3000 blue bicycles in a city of 100,000 people that's amazing!” Burger says. “That really is the thing I underestimated the most and to get the response we have from the media.”

If you’re cycling with a friend and your friend sees your blue tyre and says, 'why do you have a blue tyre?' that's telling our story and we had no idea how big that would be. Our customers - eighty percent of our customers come through word of mouth marketing - 80%. That's amazing.”

Distinct from a bicycle share company, Swapfiets’ is based on a subscription model where users receive a bicycle for a flat fee of €15 per month (€12 for students); a service which includes free repairs within 12 hours, or a replacement bicycle if it cannot be fixed within 15 minutes, or is stolen. The promise is that subscribers never go without a bicycle for longer than two days.

Burger admits he feared the company’s first launch in a big city, but in truth the timing for the company to move on the Amsterdam market couldn’t have been sweeter. Amid the back and forth over the City of Amsterdam’s temporary ban on dockless bikes in August 2017 after thousands were dumped in the city’s canals, the city subsequently opened a tender process limiting the number of operators to three.

Several competing companies including China’s Mobike, Denmark's Donkey Republic, Germany’s Nextbike and smaller Dutch operators including Flickbike, Hello bike and Urbee electric agreed to work together on open API integration for their apps, from May 2018. Amsterdam is yet to lift the ban and select the three successful dockless operators.

The Feeling of Being Taken Care of

As Burger puts it, unlike dockless share models, Swapfiets isn’t providing “no-one’s bike”. “You have your own bike, your own key, your own settings; you know your bike.”

“With Swapfiets if you park your bike at the supermarket and come back you will always know that the bike is still there. But the [dockless] bikes that are left at a random location, it's no one's responsibility. Just having that security and knowing if you break down we will be there to fix it. It's the feeling of being taken care of. Someone is taking care of you. Someone else is solving your problems. That's what I hear people like when I talk to them about Swapfiets.” 

But Burger, who recently moved to Amsterdam with the growth of the company, insists both models can co-exist. “We can live together you know because the sharing schemes are maybe more focused on daily use, for example tourists.”

Complementing cities

The response to the Swapfiets model from the Gemeente Amsterdam and other municipalities has been overwhelmingly positive. Amsterdam’s most recent bicycle policy focuses on providing safer more comfortable cycling, and addressing the city’s growing bicycle parking capacity and theft problems.

By ensuring well maintained, high-quality bicycles are out on the streets, Swapfiets can also help limit the number of orphan bikes left in cities. “So we provide safer bicycles always with lighting and good brakes you know if something is wrong then we will know because the customers will contact us. The second thing is space, parking. We know that every bicycle on the street is a customer otherwise it will be in our warehouse.”

“There are many bikes left on the streets with no owner and that’s a big, big problem for the municipalities. Then theft, especially Amsterdam has a big problem with theft so as we're the largest bike owner in the city we are the ones that are going to the police and they need only to visit or contact one place – our centralised warehouse.

Customer is King

Swapfiets' spritely young customer servants ensure the bikes meet the hands of the customers in optimal condition and stay that way for the entirety of their subscription. Whether the customer needs a fully serviced bike or merely a blown light or tyre fixed; whatever the problem, ‘the customer is king’, says Burger.

The company has developed a strong partnership with Union Bicycles, who supply the bikes (which come in orange, red, black or light grey decals) from a central distribution point in each city.

“We have a very close relationship with Union because we're interested in maintaining the bikes in as good condition as long as possible. It doesn't stop at sale with us.”

Swapfiets is sustained entirely by its monthly subscription model as well as a green financer. “They’re (funder) into smart, green mobility solutions so that's really nice that they have the faith in us, but in the end we can fund ourselves from the money earned from the subscription model. Right now we're growing very quickly.

From just a handful of employees to almost 450 in such a short period of time, a bemused Burger said Swapfiets “didn't expect this trajectory”. “It's going really fast and we are always short on hands. When we started we called our students friends … but then we switched from part timers to full timers. So as we go larger and larger we need more specialists.”

Burger says the company has attracted raised eyebrows from overseas but the focus of their first expanding outside the Dutch borders, is Germany and Belgium. “We're launching our first customers in Belgium, in Leuven [in February] which is a big student city. We're looking to Belgium and Germany to make people happy with our service. Where people are bicycling I think people will want to make use of our service.”

Burger is aware that competition may come, necessitating the need for brand building and continuing to positively frame conversations around the blue tyre.

“We need to build our brand. The brand is the thing that's going to separate us. For example, why do [people] drink Heineken and not Bavaria? It's almost the same drink but you choose one over the other and it's just the brand. That's part of our focus.”

The conversations we’ve been having [word of mouth marketing] are an opportunity but also a threat. You really need to keep your service level as high as possible because if it's always a discussion around the blue tyre. It can be positive but it can also be negative; then you're going to go in a downward spiral fast.”

Blue Skies Ahead

Aside from European expansion the company is looking forward to further innovating with, and diversifying its service.

This will soon include new bicycle models and a geared bike to attract different target groups. Swapfiets is also playing with the idea of installing bicycle trackers to improve security.

Then there’s the e-bike market. “Let me put it this way, it's [e-bike] not something we’re excluding,” Burger said with a laugh.

“It’s a really difficult question at this stage because we have a lot of ideas and we don't ... we also really need to keep focusing on what’s right in front of us because we're growing so fast.”