A One-Wheel Wonder on the Net

When John Drummond told his family 30 months ago that he wanted to open an online department store for unicycles, his father-in-law asked what seemed like a reasonable question: "How many clowns do you know?" Drummond had to admit that he hadn't met many in his former job as a technical writer for IBM.

More than $1 million in cumulative sales later, though, the president of Unicycle.com knows thousands of clowns are out there -- or at least thousands of unicycle enthusiasts. The company expects to peddle more than 4,000 of its $69 to $1,500 contraptions this year -- a 25% increase -- at a time when most retailers are worrying that sales of things like clothes and computers will drop off.

What's its secret? "There are a lot of places where you can get unicycles, but you couldn't go to one place and get them all," says Drummond, a laid-back resident of Marietta, Ga. "I kept saying, 'Why hasn't anybody thought of this?' I guess I was the lucky one to think of it first."

$700 STAKE. Drummond got the unicycle bug as a youngster in Milton, Fla., a Navy town where he would hop on his one-wheeler to do his paper route. It turned out, he recalls, that Navy pilots were more keen on paying to see him pedal than on buying subscriptions. Still, it took nearly three decades for Drummond to find a way to turn his hobby into a business.

In 1998, while looking for a way to stay fit, he began poking around local bike shops for a new unicycle. But he found little or no selection. "I turned to the Internet," he recalls. "There wasn't much there either."

So he withdrew about $700 in savings to cover a business license, logo design, and a bare-bones inventory -- and on Mar. 31, 1999, he and his wife Amy launched a unicycle e-commerce site from their home near Atlanta. By then, Drummond had spent months getting out word of his new enterprise through Internet newsgroups for unicyclists and through contacts in the unicycling community. Still, his site's world premiere didn't make a splash. "We opened our doors, and nobody came," says Drummond. "We were twiddling our thumbs."

GLOBAL DEALER. Unicycle.com would have to wait 11 days to get its first order -- for an $11.95 rear view mirror, plus shipping. But soon after that, business began to crank up. As volume grew, Drummond gained enough clout to become a dealer for more than a dozen unicycle brands, including Japan's Miyata, considered among the finest.

"The very existence of this site is increasing the market for unicycles rapidly," enthuses John Foss, Sacramento (Calif.) president of both the Unicycling Society of America and of the International Unicycling Federation. Foss is engaging in a little hyperbole: The worldwide market for unicycles is an estimated $3 million a year, according to Drummond.

Foss, a three-time world champion unicyclist and a frequent judge at unicycling events whose day job is doing Web development, isn't an objective observer: He acts as a celebrity spokesman for Unicycle.com, and in return gets a small percentage of its net. Still, it appears true that Drummond is making his mark. Cirque du Soleil, the critically acclaimed Montreal circus company, recently bought a cycle for a high-wire act, he says. And the Shrine of North America, the fraternal and philanthropic organization whose members are known as "Shriners," has bought minibikes from Unicycle.com to use in parades, he adds.

MINI-MARKET. Most of Drummond's customers pay as much as they would in a retail store, once shipping costs are factored in. But what distinguishes Unicycle.com, he says, is selection. The site sells not just unicycles of every variety, but also parts and accessories, including tube-repair kits, decorative spoke beads, and unicycle travel bags.

Still, even a booster such as Foss is realistic about the startup's prospects. Although he estimates that the U.S. has nearly a million unicyclists, he thinks that only about 10,000 ride at least once a week. The introduction of mountain unicycling (mountain biking on one wheel) in the mid-1990s has attracted the extreme-sports crowd. But that still leaves unicycling short of a fad. "I think John knew from the get-go that [Unicycle.com] would be a risk," Foss surmises.

So far, however, Drummond has seen more reward than risk. Sales in 2000 hit $455,000. And 2001 is bound to be better, with revenues already at $500,000 going into the holiday season -- during which Unicycle.com normally gets about 40% of its annual revenues. Drummond says the company is profitable, though he declines to give a number.

NO DISNEY WORLD. He does say that his family, which includes three sons, is living a little more comfortably now than when he was earning $50,000 from IBM as a technical writer. (Drummond says that IBM fired him in November, 1999, after 22 years -- when his manager noticed that he was using company phones to conduct Unicycle.com business. But Drummond adds that he left Big Blue on good terms and that he even used the company as Unicycle.com's Web hosting provider.) Drummond's wife, Amy, is Unicycle.com's "CEO" -- the company's office manager and sales helper.

For now, Drummond is plowing most of Unicycle.com's profits back into the company. In August, he plunked down $15,000 to buy a 3,200-square-foot warehouse, which has let him move the business out of a temporary space. That meant postponing a family trip to Disney World and putting off replacing his '81 Ford pickup, which has 350,000 miles. "If we weren't investing so much in the business, we would be living better," Drummond says.

How is it that Unicycle.com can survive and perhaps even prosper when companies that sold pet food, clothing, and toys over the Net failed so spectacularly? One answer, says Tim Miller, president of WebMergers.com, a San Francisco research firm, is that Petopia, Boo.com, and eToys, to name a few tombstones in the dot-com cemetery, all wasted too much of their initial investment. "Those companies overbuilt," he adds.

CALLING UP RESERVES. Unicycle.com, by contrast, is self-funded and penurious. Aside from word-of-mouth and sponsorships at unicycling competitions, Drummond advertises mainly in Boys Life and Dirt Rag, not exactly Vanity Fair when it comes to ad rates. He has hired just three employees -- a logistics manager, a warehouse operations chief, and an assembler who doubles as a sales guy. When business picks up during the holidays, his sons Casey, 13, Zachary, 10, and Sawyer, 7, will be called up from the reserves. (All three sons are unicycle riders who have won medals in national competitions.) "We've put a lot of sweat equity into this place," Drummond says.

Moreover, WebMergers' Miller notes, Unicycle.com may benefit from its niche market focus. "They are an example of what the Internet does well," he adds. "They can 'narrowcast' -- be very focused on a specific audience." Miller warns that although the company's business model appears to be solid, he isn't sure how fast it can grow. "The question for a company like this is how far can it scale -- or does it need to scale?" he says. "And how does it compete if the unicycle category killer comes along?"

At least for now, Unicycle.com itself may be the category killer. Unicycle Factory in Kokomo, Ind., once considered the go-to place in the U.S. for quality unicycles, especially custom ones, has suffered a two-thirds drop in business since Unicycle.com opened shop, says owner Tom Miller. Drummond "built a dam further upstream than my dam," he says. Miller has a Web site, too, but it simply instructs visitors to call his one-person company to place an order.

24-FOOT UNICYCLES. In fact, Unicyle Factory's Miller has resisted moving into e-commerce. "It would take me an additional two hours a day to answer curiosity questions, and I wouldn't be getting paid for it," he says. Miller, who crafts custom unicycles for performers, such as 24-foot-tall ones and cycles with hobby-horse seats, offered lots of advice to Drummond before he started Unicycle.com, both agree.

And this small-business owner says he was "massively depressed" at first when Unicyle.com began to siphon away his business. But, he adds, he has since become more philosophical about it. "I would have grown to that level if I could have," he says. "I don't blame Drummond."

Drummond realizes that new competition could be just around the corner for him, too. To help defend against that, he's commissioning his own brand of mountain unicycle -- or MUni, as they're known. The Wilder is named after Wilder State Park in Santa Cruz, Calif, which is popular among mountain bikers. Among other things, the unicyle features a hand-cut and hand-welded aluminum frame weighing only 1.5 pounds. Custom made for Drummond by a New Jersey machine shop, the cycle, which can cost up to $1,500, comes with a rugged tire that's three inches wide. "It's like being on a tractor," says Drummond, who adds that the design reflects input from customers who wanted a better bike to handle tough terrain.

TOUGH RIDE. The business has other strengths that may help keep competitors at bay, says Drummond. For one, his Web domain name is about as good as you can get if you sell unicycles. He started as UnicycleSource.com because Unicycle.com was owned by a 20-something who wouldn't sell. But when the Vermont resident decided to move to New York City he sold the name for $4,000, about three times what Drummond had hoped to pay. "I didn't even tell my wife," he says. "She would have been furious. But it made a huge difference."

As part of his growth plan, Drummond plans to expand his business among the main types of people who ride unicycles including performers, fitness buffs, and off-road thrill-seekers. Once new riders learn about his site, Drummond hopes they'll need to keep coming back to upgrade their equipment.

International expansion is in the works too. Drummond already has a partner in England, and the two now sell each others' cycles and parts. And he's currently scouting for partners in other countries including Japan, where unicycling is a big sport and part of the physical education curriculum in schools, according to Foss and others.

Much of unicycling's draw comes from its difficulty: It usually takes at least two weeks to learn to do it, but after that "the person riding the unicycle is breaking the rules," Foss says. "It's the I-can-do-it-but-you can't factor that makes it attractive." It's certainly an attitude that describes both Drummond and his company. And now, it seems the Web has given them a platform for reaching a worldwide collection of like-minded souls. By Eric Wahlgren in New York