The Amazing Ride of HED Cycling — and the Twists and Turns Along The Way
Published August 2016
Premium quality bicycle wheels and components.
2016 FedEx Small Business Grant Contest Winner
If you follow professional cycling, or triathlons, or are a weekend bicycle warrior yourself, you undoubtedly know the name “HED.” This 30-plus-year-old, Minnesota-based company is the Holy Grail of wheel innovation, continually developing new products that help elite athletes triumph, and amateurs everywhere feel podium-ready after their rides.
But, the most interesting thing about HED Cycling is not its aerodynamic innovations or longevity in an industry where it’s way too easy to crash and burn. It’s how the company started. This iconic small business wasn’t founded out of ambition or a quest for greatness. HED Cycling was born because of love.
Back in the early 1980s, the then unmarried Anne Hed was a gifted young swimmer with a knack for endurance sports. The first time she watched the Hawaiian Ironman Triathlon, she was hooked. She entered a competition in Texas and won. The good news: that win qualified her to compete in the world championships in Kona, Hawaii. The bad news: she was a young, starving college student who couldn’t afford the $100 entry fee. “A friend told me that there was a guy named Steve Hed who ran a bike shop who would probably help me out. So, I walked in the shop and there stood Steve — barefoot, shirtless, with permed magenta hair,” Anne said. “I said ‘A friend told me you’d give me $100 for the Ironman.’ He said, ‘Okay, do you need a bike, too?’” They became friends, started dating and then became a real couple. Anne continued to compete in triathlons around the world, while Steve kept the bike shop, and one very special project, going back home.
Wheel of Fortune
While Anne was traveling, Steve was meticulously crafting a disc wheel — a solid rear wheel designed to improve aerodynamics, so cyclists could go faster with less effort. At the time, there was a disc wheel on the market in Europe, but with a price tag of $6,000, it was a luxury few cyclists could afford. “Steve worked and worked, and made this amazing disc wheel with his own two hands,” Anne said. “When I came home, he showed me the wheel and said, ‘I want this to be yours.’ I was the first athlete to ride on his disc wheel.’”
The more she raced, the more cyclists wanted this Steve Hed innovation. Clearly, the wheel had a waiting market. They could sell it for about $500; a much better value than the European option. The problem was, they needed money to start production. “I saw a triathlon where the first prize was a car. I entered and won — my prize was a 1984 Subaru hatchback. I hoped we could get enough money from the car to start our business,” Anne said. “So, at the age of 22, I went from bank to bank, explaining that we had a great idea, that I had a car, and asking if they’d loan us money.”
She got a lot of “no’s,” until one local institution loaned her $14,000 for the car title. “That was enough money to buy raw materials to start producing our disc wheels, which we made by hand,” Anne said. “Steven sold his shop, an uncle let us use a small manufacturing facility and his parents let us use their garage.” The timing could not have been better. Triathlons were just starting to gain popularity, attracting more athletes and media attention. Little by little, the business started taking off. Anne and Steve bought a house that was zoned for residential and commercial, and moved HED Cycling to the connected garage.
Building Momentum, While Enjoying the Ride
The turning point came when Anne and Steve got a call from a 16-year-old kid in Texas named Lance. “This little kid was breaking our wheels, that’s how fast he rode. That just didn’t happen. So, we started paying him $200 a month for a year to ride and test our product,” Anne said. “Lance Armstrong became our first sponsored athlete.” But, that first wheel was just the beginning. The beauty of HED Cycling is that it never stopped innovating.
In 1990, the same year the couple got married, Steve invented a deeper section carbon wheel with stainless steel spokes and hub. This not only added a front wheel to the product line, but gave the company a wheel it could sell to the mass market. As time went on, HED expanded its carbon wheel line, and added wide aluminum models for biking on gravel. Other key innovations and patents soon followed, including aerodynamic recumbent wheels, carbon fiber aerobars, multiple aerodynamic hydration systems; and the company’s groundbreaking C2 rim technologies.
HED Cycling grew along with the innovations, transforming from one couple’s “big idea” into a 46-person company that proudly outfitted riders in the Olympics, Paralympics and triathletes worldwide. Steve was the innovator, Anne was the operational Obi-Wan Kenobi, keeping the company running like clockwork. They were the ultimate team; partners in life and in work, with two kids, a great marriage, and the respect of an industry they loved so much.
And Just Like That, Everything Changed
In 2014, without any warning, Steve Hed died of a heart virus at age 59, collapsing just outside of one of the company’s facilities. “He was totally normal that day. We talked on the phone in the afternoon, and everything was fine. The next phone call I got was one telling me that they found him on the ground,” Anne said. “I struggled because we were such a team. I couldn’t imagine what it would be like without him.”
She could have sold the business. She could have shut down and stepped aside. But, Anne Hed did the same thing she did when she was competing in triathlons: she powered through. “We had just signed a lease on a larger building and a month or two after Steve died, so we had to move 40 people in December, in Minnesota. Not the easiest thing,” Anne said. “But that new building was like a rebirth, a breath of fresh air. We were combining two buildings that were two blocks apart that might as well been 10 miles apart. The building was so bright and cheery; the energy was so great. All of that kept me going.”
At the same time, the orders kept pouring in. “I couldn’t stop. We were beyond busy. In a lot of ways, that kept me focused. That, and our employees, who are like family to me. They gave me strength I needed to keep moving forward,” Anne said. She did more than make it through. With tenacity, grit and determination, Anne not only kept the legacy of HED Cycling alive, but helped it continue to thrive. The company increased revenue by 18 percent in 2015, largely due to the popularity of the company’s fat wheels, with no signs of slowing down. As we said earlier, endurance sports are her strength. With her company, as with her races, Anne Hed is in it for the long haul.
Winning a FedEx Small Business Grant — On a Very Special Day
HED Cycling has long used FedEx for international shipments and imports. Although it missed entering the 2015 FedEx Small Business Grant Contest, long-time employee Julie Olson made sure the company entered in 2016. Anne found out that HED Cycling won a grant on her husband’s 61st birthday.
“When I woke up that morning, I felt something; I knew that it was going to be a special day. It was the second year that Steve wasn’t with us. As a family, we try to stay positive,” Anne said. “Then, we got the call from FedEx, telling us that we’d won a grant. I felt like we were celebrating a birthday and that Steve had just gotten a gift.” She’ll use the grant money to fund part of a piece of equipment the company needs for tooling. “I think Steve would think this grant is just great,” Anne said. “We’ve always taken great pride in the fact that we made our own tools. The grant helps us stay true to that part of our brand.”
The Road Ahead
Anne Hed has been through a lot and accomplished a lot in her time, with many more achievements to come. Although HED Cycling is more than three decades old, it never stops innovating, achieving or taking on projects that are a little bit scary. That, she says, is the secret to its success.
“You have to get scared; to get out of your comfort zone or you’ll never evolve your company. You’re going to fail a lot. That’s part of being an innovator,” Anne said. “You fail, but you have to fail forward — fail because you tried something new, not because you stopped thinking or trying.” Spoken by a true performer: on the track, in business and in life.