Friday, March 31, 2006
The John Howard Frame Saga
There is a part of the story I have not told before; how I opened my frameshop in San Marcos, California in 1983 and started producing John Howard frames and why this arrangement only lasted about a year?
I went to work for Masi in October 1980 and through the following year I built about 25 or 30 frames a month. The problem was they were not selling close to that number and by the end of 1981 there were hundreds of Masi frames hanging from every available space in the shop. I had in effect worked myself out of a job, and in December 1981 I was laid off temporarily and told to sign on unemployment.
I actually got as far as standing in line at the unemployment office. I found it very degrading and left without actually signing on. I went back to Masi and asked if I could build my own frames in their shop using their equipment. I had already been building a few of my own frames on my own time the year before and I had a few orders to get me started. I started calling bike dealers all over the US offering to build custom frames. I could build a custom frame within two weeks which was unheard of at the time.
Enough work came in that I did not have to sign on unemployment. The problem came six months later when Masi had made inroads into their stockpile of frames and wanted to start production again. I now had enough work on my own frames and didn’t want to go back to building Masis. It just so happened that Dave Tesch had come along and was able to step into the breach for Masi. But the problem was we were all using the same equipment, and it became obvious that I would soon need my own shop.
I had about $7,000 of my own money saved but needed to borrow another $23,000 to open a full production frameshop. I managed to borrow this from a local bank which was somewhat of a miracle because I had only been in the US for three years and didn’t have enough of a credit rating to even get a credit card.
One of the things that helped me get the loan was that John Howard an ex Olympian and had won the prestigious Iron Man Triathlon in 1980, had asked me to build a line of frames with his name on them. I opened my frameshop around July of 1983 in a brand new industrial building in San Marcos, CA about a mile from the Masi shop. John wanted his frames to be of the same standard of workmanship and quality as the Masi frames, but he intended to sell them for less. Tough to do but we agreed on a price; the agreement was that I would build five frames all the same size at one time, and repeat that every week.
Now here is were the story gets interesting and is the part I have not told before. There was an individual who had a business in La Jolla, next to San Diego. He was a broker dealing in foreign currencies. He had salesmen going around getting investors and everyone was making lots of money. He was sponsoring the local triathletes and paying John Howard a considerable amount as their coach.
This was the money John was using to buy frames from me. Every thing went great for about a year then the investment broker it appears was not investing in anything. He was a crook and the whole thing was a Ponzi scheme, a scam using new investors money to pay off old investors.
John Howard was of course a victim of all this as much as anybody, as well as losing his source of income; he too had invested heavily with this guy. John no longer had the means to order five frames a week from me, and I had to scramble to fill the void in my production. This is when the Fuso was born.
I don’t remember the name of this individual from La Jolla which is perhaps as well. He did go to prison for a long time. He also indirectly helped the then new sport of triathlons get a boost, helped me get my frameshop going and forced me to start a line of frames called Fuso.
Posted by Dave Moulton at 3/31/2006 01:20:00 PM