5 min read

Weekly Debrief: PureGym adds $400M, Athletic Greens scales up, Found lands $100M

Welcome to the Fitt Insider Weekly Debrief. Every weekend, we compile the top stories impacting the business of fitness and wellness from the past week.

Here’s what you need to know for December 19, 2021…

  • PureGym raises $400M from KKR
  • Athletic Greens adds Kat Cole to its exec team
  • Found lands $100M more for weight management

Gyms are Dead?

PureGym secured a £300M (~$400M) investment from private equity firm KKR.

The deal values PureGym north of $2B, with KKR holding a significant minority stake.

Bulking Up
Founded in 2009, PureGym is the UK’s largest gym business, earning £111M in revenue for the quarter ending September 30.

In 2020, the low-cost operator acquired Denmark’s Fitness World chain for £350M. With its additions, PureGym counts 1.6M members across 511 clubs across the UK and Europe.

After considering a public offering, KKR’s backing will allow PureGym to continue expansion efforts, including locations in Saudi Arabia, Asia, and the US.

Fitness in Flux
Pandemic-related lockdowns crushed brick-and-mortar fitness, sending the $96B global industry into a tailspin.

The reopening rollercoaster created additional uncertainty for in-person exercise. All the while, home fitness brands thrived. But now, the tables are starting to turn.

  • In recent months, digital and connected fitness companies, including Peloton, MIRROR, and Beachbody saw demand shrink.
  • At the same time, gyms and studios like Planet Fitness, Xponential Fitness, and Crunch are returning to pre-pandemic growth.

In the US and abroad, gyms are finding their footing. Adding to PureGym’s capital raise, Life Time recently went public. Brazilian gym chain SmartFit completed its public offering. And shares of UK-based Gym Group are up this year as memberships rebound.

Back from the Dead
Despite the Gympocalyse narrative, gyms and studios are plotting a comeback. As we detailed in Issue No. 150, when it comes to workouts, consumers want optionality. Far from an either-or option between in-person or at home, the future of fitness is likely an all-of-the-above proposition.

Seeing Green

Nutritional supplement maker Athletic Greens hired Kat Cole as president and chief operating officer.

Cole joins the company after a 10-year run at Focus Brands, where she oversaw global operations for nine brands spanning 6K locations, including licensing and CPG efforts. She’s credited with the turnaround of Cinnabon into a billion-dollar brand.

All-in One
Founded in 2010, Athletic Greens is best known for its daily, all-in-one nutritional powder. After initially bootstrapping the company, founder and CEO Chris Ashenden is accelerating the business.

  • In July, Athletic Greens added its first outside capital, including funding from SC.Holdings, F1’s Lewis Hamilton, actor Hugh Jackman, and other strategic investors.
  • The brand is planning to enter physical retail, starting with hotel and fitness partnerships.
  • Annual sales are growing 200% YoY, putting the company on pace to exceed $100M in revenue this year.

The company also honed its branding, shifting the focus from Athletic Greens to the more accessible AG1 namesake. Broadening its base, 45% of new customers are female.

Announcing her new role, Cole said:

“Athletic Greens is a wellness rocket ship with a mission-driven founder and passionate team who are leaning in and co-creating a new consumer category of foundational nutrition.”

Teasing what’s to come, Cole said the company’s community efforts will “likely intersect with web3 and NFTs in the near future.”

Big Business
A growing segment of the trillion-dollar wellness industry, nutrition supplements are a massive business:

  • In 2020, the US supplement market will surpass $50B.
  • Globally, the industry is projected to reach $188B by 2025.

While 86% of US adults take vitamins or supplements, as we outlined in Issue No. 108, the efficacy and safety of said supplements are questionable.

Still, brands are bulking up their efforts to capitalize on this trend.

  • In April, Unilever acquired Onnit, a supplement company backed by Joe Rogan.
  • Last year, Nestlé Health Science acquired collagen bar, beverage, and powder maker Vital Proteins.
  • Also in 2020, Bayer acquired personalized vitamin maker Care/of for $225M.
  • To date, high-performance supplement maker Bulletproof has raised $80M+, while bone broth protein powder brand Ancient Nutrition has secured $100M in funding.

Looking ahead: No doubt Ashenden and Cole are pointing to these examples as they consider Athletic Greens’ potential.

Diet Tech Cashes In

Found, a digital weight management startup, raised $100M in a Series B round, valuing the company at $600M.

Of note, this new investment comes two months after the company emerged from stealth with $32M in funding.

Incubated at Atomic, a prolific venture studio, Found is also backed by WestCap, IVP, The Chernin Group, G9 Ventures, and Able Partners, as well as prominent angel investors.

What It Is
From prescription medication to supplements and health coaching to diet and exercise plans, the Found platform will take a multifaceted approach to weight loss.

According to Jack Abraham, Found co-founder and Atomic managing partner, the company offers “a comprehensive, tailored, and precision-based solution to help anyone looking to lose weight.”

  • This year, Found’s revenue run rate has grown by 6x.
  • Since its inception in 2020, members have lost more than 300K pounds.
  • On average, members lose 10% of their weight by month six and have kept it off.

Available in 37 states, Found is expanding across the US while investing in growth and infrastructure.

A Growing Problem
As we covered in Issue No. 151, Weight of the World, obesity and diabetes are skyrocketing.

Eyeing a billion-dollar weight loss market, digital health startups are hoping to alleviate the metabolic health epidemic.

  • In April, Virta Health added $133M in funding at a $2B valuation for its diabetes reversal treatment.
  • In May, digital weight loss app Noom was valued at $3.7B in a $540M funding round.
  • Digital metabolic health company Calibrate landed $100M in Series B funding co-led by Founders Fund and Tiger Global.
  • More recently, Fella, a telehealth clinic helping men achieve a healthier weight, secured funding from YCombinator and others (including Fitt Insider).

Punchline: With over 70% of the population considered overweight or obese, and 88% of Americans metabolically unhealthy, expect to see more startups taking an “any means necessary” approach to curbing this crisis.

Get the latest health and fitness industry news

Keep up with industry news, trends, investment activity, and job openings — in one weekly newsletter.

    No thanks.