The Peloton of “X”
For the foreseeable future, the Peloton of “X” will come to define the fitness industry. With word that Peloton could go public at a value north of $8B, they’ve become the fitness equivalent of Uber, Airbnb, Warby Parker, or any other category-defining startup. And the impact is already being felt.
Piggybacking on Peloton’s success, would-be entrepreneurs will now point to the company as the shining example of what could be. As a result, investors can expect to encounter pitches with a similar refrain, “we’re like Peloton for [activity]”. However, these pitches are not unwelcome; many of those same investors are actively searching, checkbook in hand, for a concept with Peloton-like potential.
Michael Farello, a managing partner at L Catterton—a private equity firm with a reputation for backing disruptive fitness companies like Equinox, Peloton, and ClassPass—has said as much. Farello told Business Insider that, although the firm has invested broadly in health and wellness, they’re honing in on differentiated concepts within fitness. As more consumers seek out connected fitness experiences that provide a personalized, convenient, and efficient workout, Farello thinks the current stable of fitness startups is only the beginning.
“Artificial intelligence is really bringing the personal trainer into the home. I think that is the next big wave.” – Michael Farello, L Catterton
To date, a number of tech-enabled fitness concepts have tapped this trend. Drafting off Peloton, Zwift has raised $164.5M to develop their gamified, virtual cycling platform. According to Zwift’s PR manager Chris Snook, “users have created over 1.1M Zwift accounts and, since launching their paid service three years ago, revenue has been “growing at an average of 2.5X year on year.”
Going beyond the bike, a growing list of competitors are hoping to become the Peloton of rowing, weightlifting, boutique studios, and more.
By combining an interactive LED screen and electromagnetic weights with a fold-out bench and cables, Tonal has managed to pack an entire gym and an AI-powered personal trainer into a wall-mounted strength training system. Similarly, Mirror is beaming boutique fitness classes into the home by way of a sleek, mirror-like (go figure) display that’s actually an interactive LED screen. Then there’s Hydrow, a connected indoor rower that recently raised $20M from L Catterton. And, as the up-and-comer of the bunch, FightCamp by Hykso is bringing boxing into the home with punch-tracking sensors to measure the count, type, speed, and “intensity” of your jabs.
Still, these companies only represent a small segment of startups aspiring to be the next Peloton. Studios like Flywheel Sports, Rumble, and CityRow have also thrown their hats into the connected fitness space. While the former developed its own bike, the latter two studios have partnered with equipment manufactures—Technogym and WaterRower, respectively—to offer at-home options.
At the same time, countless other companies, including Aaptiv, Freeletics, NEO U, FORTË, and the like, have taken the “Netflix of fitness” path by building streaming platforms.
What’s the punchline, then? It all comes full circle when you realize that Peloton CEO John Foley refers to his company as the “Apple of fitness.” Meaning, as the guy everyone else is chasing sees it, the opportunity presented by connected equipment and on-demand fitness is much bigger than anyone thinks. Thus, be forewarned: the level of impending disruption may far exceed expectation.