Bicycles were first driven by direct drive cranks, but a new paradigm in bicycle drive systems was needed, in the late 19th century. This need coincided with the arrival in England of a young Swiss man, Hans Renold. Working around machinery, he soon invented the roller bush chain, in 1880. This was just the power transmission device needed to power a rear drive bicycle, and was incorporated into the Starley safety bicycle. This method of power transmisstion is an incredible 98% efficient, and is virtually unchanged in today's bicycles, even though the rest of the bike has been almost completely redesigned. Matt D. Kidd and R.L. Rueben, of Hariot-Watt Univ., Edinburgh UK, have written a great paper on the efficiency of the roller chain.
The Renold Company is still in business making chains and bearings for industrial use.