A version of this feature ran in the November issue of BRAIN.
CHATTANOOGA, Tenn. (BRAIN) — The depth of Chapter 11 reorganization usually is measured in financial losses. For Lynskey Performance Products, the losses were much more personal.
Speaking for the first time publicly in September since the company filed for bankruptcy on April 30, Mark Lynskey, detailed a series of personal tragedies that in part led to the financial downfall. Mark, 69, owns the company with his sister Theresa and brothers Chris and Tim.
The family business was started by Mark's father, working in exotic metals for the chemical, food and beverage, aircraft, aerospace, and military industries. Mark started in the company when he was 17.
The family entered the bike industry in 1986 with the launch of Litespeed. In 1999 the family sold the bike brand to American Bicycle Group, which continues to operate it from Chattanooga. The family rejoined the industry in 2006 when it established Lynskey Performance.
According to court filings, the company's woes began in early 2024 when Mark's brother and co-founder and managing member David Lynskey's health began to decline.
"David was one of those people who was the first one there and the last one to leave," Lynskey said. "In the late fourth quarter of 2024, David was at the point where he was in and out of the hospital. And the family was focused on trying to help him. In hindsight while caring for David was clearly the first priority, we should have paid more attention to what was going on in the business. We didn't."
Payroll rises, production drops
Following David's death in June 2025 from a bacterial digestive issue at age 65, Mark assumed a more active role and was shocked to discover sales and production were sliding and the short-term solution had been to lower prices. "Payroll's going up, production's going down. It was the perfect storm of 'oh damn.' And while we didn't have bad employees, there had been a lack of leadership and there was no one pointing the boat, having everybody row in the same direction, and with little managing guidance, the company as a whole lost its way."
That leadership vacuum began even before David's health problems. About 4½ years ago plant manager Steve Kirby, who was in his 50s, died after contracting COVID. Hired in 1984 as a draftsman, Kirby "ran that shop to perfection. We never had to worry about production," Lynskey said.
A year and a half later, Head Machinist Bill Thompson, another leadership figure and family member (he was Mark and David's uncle), died from a heart attack. "He did everything from creating jigs and fixtures to helping anywhere it was needed," Mark said.
Nine months later, another company stalwart, welder and jack-of-all-trades Louis Scroggins, 69, died from a brain tumor.
Court filings also noted the company's decision to develop e-commerce sales through Shopify led to the Chapter 11 as Lynskey fell behind order fulfillment and was unable to buy materials and components.
"(S)upplier invoices began to accumulate and Shopify instituted a 15% reserve on sales to the tune of $105,000 within the 90 days prior to the filing of the Debtors Bankruptcy Petition," according to a court filing.
Sales channel misstep
Lynskey said the company's sales manager during 2023-'24 focused on e-commerce at the expense of dealer and distributor sales. "I can tell you it wasn't an ownership decision. When I saw it, I let the gentleman go. I didn't sit there and try to pry. 'What the hell were you thinking? What are you doing? Why are you doing this?' It was just like, 'OK, this isn't working. You're free to go.'"
Since the filing, the company has held sales on some frames for as low as $900 retail, leading Lynskey to say, "I've reviewed pricing, and I'm facing a real pickle right now relative to dealer pricing, retail sales, etc. To get short-term sales volume, our prices, even on our website, are way more aggressive than they should be. You get a frame for 900 bucks, and with anyone else, it's a $2,500 frame. We're making a couple points on it. It's not enough incremental cash to grow the company right now, but it's keeping our nose afloat."
The company also established an eBay sales channel last fall, which concerned some dealers, Lynskey said.
"I started using eBay because, for better or worse, it's an instantaneous customer base that you don't pay for any marketing other than the 14% on the sale. And you're immediately exposed to hundreds of thousands of potential customers — but they're all bargain-basement shoppers."
Reestablishing a dealer and distribution network is a priority, said Lynskey.
"I've had the conversations with a few dealers," Lynskey said. "(They ask,) 'Why would I even touch you? Look at the prices on your website. Look at what you're doing on eBay. There's no margin for me to be made here.' My response is as the dealers and distributors start growing back, I can cut back on that (discounting) and eliminate eBay. We're not going to step away from e-commerce, but I don't want to have to rely on it 100%."
Lynskey said the company is back on its feet but not at the volume and profitability needed.
When asked if there's light at the end of the tunnel, Lynskey said, "It may be a pin flashlight at the end of the tunnel right now, but it is a light. There's a lot to be done."
"But we are at good efficiency in manufacturing cost-per-unit. Now we've got to start building back profitable sales volume. We need to be increasing sales as production grows because we don't need to suddenly have $300,000-$400,000 of inventory that we can't sell."
Hiring challenges
Further hindering Lynskey has been hiring competent employees. "It's still hard finding the right people — welders, machinists — in this day and age. Hell, anybody that can even read a scale and measure something is a little bit of a neat trick."
The thought of selling or merging the brand has never been seriously considered, Lynskey said. Attracting an investor, however, would be welcomed.
"The potential for this business, this company, is just sitting there. It's just blatantly obvious. Our worry is not a potential customer base. It's getting the company stable and reaching back out to an existing customer base and getting people to know about us again and trusting the brand. An investment into the company would give us a chance to breathe and not have to spend every second of every day putting out fires.
"I haven't started looking. I haven't put out any feelers for any of that. Again, probably should have. But again, my lord, every day is just ..."
As recently as the fourth quarter of last year, the company was in the black. "I'm not saying there were any significant numbers to the left of the decimal point in that profit. We've got a good staff, and so now I'm at a point of saying we can start rebuilding here."
"We're not going anywhere," he said. "It's all the whole family has ever done. If Lynskey were to go away, what the hell are we going to do? We are very good at what we do, but we did lose focus. As a family, we are dedicated to bringing this brand back to what it represents. The customer base is there, even in the current economic environment."
Making the company profitable again involves rebuilding its core structure, Lynskey said.
"A company has to be prepared not to just manage current volume but have the structure — or at least the plan — to prepare for and manage growth. To be successful both short term and long term, we need to rebuild strong dealer trust and representation in the U.S. and distribution internationally. I don't see us moving away from e-commerce totally, but it has to be synchronized with our dealer and distributor base. At our level of performance and price, we can only do so much online. To be fully successful, it takes the customer being eye to eye with a human (dealer) to establish the trust needed to be willing to commit to the cost of our product. You can't do that online."
Coming out of semi-retirement reminded Lynskey how much he loves the brand and the industry but said the thought of walking away for good has crossed his mind.
"I have a runway for the next five to six years. And along the way I would like to start having some free time within that timeframe. Make no mistake, I have been blessed with a life of amazing adventure. I'm that person that has seen it all and doesn't have any self-pressure to do it again. After seven children, 10 grandchildren, and being a part of running and growing a successful business for the past 40 years, I look forward to the day that if I want to, I can lay in bed all day surfing YouTube and having food delivered," he said, laughing.
Lynskey by the numbers
CHATTANOOGA, Tenn. (BRAIN) — While some bankrupt companies quickly shut down and liquidate, and others are quickly sold, since Lynskey Performance Products, LLC filed for Chapter 11 in April, the company has continued operating, fulfilling new orders from individuals and shops. Under bankruptcy law however, those owed money or products before the filing will have to wait for a resolution of the case to get payment.
In its initial filing the company listed secured debt of $1.2 million, all of it to First Bank for the balance owed on a $1.25 million real estate loan taken out in 2025 to buy Lynskey’s factory and a $600,000 revolving credit line from the same bank.
The building is valued at $2.3 million, meaning the company has about $1.3 million in equity in the property. The property, operating cash and inventory were collateral for the loan and the credit line.
The filing estimated the company’s unsecured debt, including trade debt, unfulfilled pre-petition orders and a $300,000 family loan, at about $1.27 million. Unfulfilled consumer or dealer bike orders made before the bankruptcy are considered unsecured creditors.
The court, with the approval of First Bank, is allowing Lynskey to operate until at least the end of the year using the cash collateral for operations and paying critical suppliers, including bike industry suppliers like FSA, QBP and Shimano, welding and manufacturing suppliers and shipping companies as needed to operate. Some of the critical suppliers are owed money from before the bankruptcy filing but the court does not allow Lynskey to make payments on those debts. It also cannot fulfil the pre-petition bike orders for the same reason. No bankruptcy trustee has been requested or appointed.
Since the filing the company has cut its workforce from about 33 to 23. In June, July, August, and September it reported total revenues of $347,000; $289,000; $324,000; and $226,000, respectively.
By comparison to the recent monthly revenue reports, in 2024 Lynskey had revenues of $6.6 million, or an average of $550,000 per month, according to court filings. 2025 revenues were unavailable.
After expenses — which include $15,500 monthly protection payments to First Bank — Lynskey reported net income of $100,000 in June, $36,000 in July, $11,000 in August, and $11,000 in September. The June number was higher than others because Shopify released some funds to Lynskey it had been holding.
— Steve Frothingham
