Past Issues

The business of fitness and wellness.



Last week, as Equinox Group announced its foray into connected fitness, patrons of the company’s high-end health clubs and SoulCycle studios lined up to cancel their memberships. Why? Let’s just say Equinox had a week. Here’s what went down.

The Good: Equinox unveiled its Peloton competitor. Launching later this year, Equinox will offer connected equipment and streaming content for the at-home market that encompasses its portfolio of fitness brands, including Equinox, SoulCycle, and Precision Run.

  • The SoulCycle stationary bike, identical to those found in its studios, is getting a screen and will be available for purchase. (FWIW: Both the SoulCycle and Peloton bikes were designed by Eric Villency
  • Proprietary Woodway treadmills, also equipped with a screen, will bring the Precision Run studio experience into the home. 
  • A yet-to-be-named digital platform and app will feature live and recorded classes led by top instructors from Equinox’s portfolio of fitness concepts. 
  • Prices were not announced, but across the connected fitness landscape, costs range from $1,000 to $4,000 — plus a $40–$50 monthly subscription fee for content. 

As we’ve detailed in our ever-evolving Peloton of ‘X’ list, connected equipment and streaming content are redefining the fitness industry. 

To date, Peloton has benefited from first-mover advantage, raising $995M, earning a $4B valuation, and testing the IPO waters. While a growing list of upstarts has been fast to follow their lead, Peloton is the undisputed frontrunner. But, in entering the at-home space, Equinox isn’t trying to beat Peloton at their own game. Equinox is playing a different game altogether.

For perspective, Peloton has sold more than 400,000 bikes and counts more than 1M subscribers among its userbase. Some reports put their 2018 revenue north of $700M. 

Equinox is a luxury fitness company backed by The Related Companies (more on that later), whose portfolio of brands includes Equinox, PURE Yoga, Blink Fitness, and SoulCycle. Across all its brands, Equinox counts more than 200 locations that generated $1.3B in 2017 revenue. 

Although Peloton has assembled a strong talent pool, pointing to its instructors as a key differentiator, Equinox and SoulCycle created an in-house talent agency to represent their instructors and trainers. Additionally, PROJECT by Equinox serves as a class and talent incubator for the brand. 

While Peloton’s “Hotel Finder” is smart, and there’s an opportunity to sell their equipment commercially, Equinox has pushed into hospitality, opening the first-of-its-kind hotel in New York. With additional hotels planned for Los Angeles, Santa Clara, California, Seattle, Chicago, and Houston, plus 90 health clubs, Equinox will have plenty of opportunities to feature its own equipment. 

The Equinox of ‘X’. While countless connected fitness companies have piggybacked on Peloton, Equinox may have leapfrogged the entire category. 

“It’s really the intersection of digital and physical that makes this a very different concept to begin with.”
—Jason LaRose, CEO of Equinox Media

As we’ve discussed, the near term future of fitness will be defined by access—the option to work out at home, go to the gym, or tune into an audio class—and won’t be confined to an either-or decision between digital or in-person exercise. 

If that’s to be believed, the Equinox of ‘X’ represents an omnichannel approach to exercise that offers components of real-life workouts and community: access the SoulCycle or Precision Run experience in a studio, in your living room, or in an Equinox hotel or health club. All of a sudden, Peloton a competitor is offering more than just another piece of connected equipment.

The Bad: Equinox’s announcement couldn’t have come at a worse time. Just as we got word of the bike/treadmill launch, news broke that real estate billionaire Stephen Ross would be hosting a ritzy fundraiser for President Trump at his home in the Hamptons. 

Who’s Stephen Ross and why does it matter? In addition to being America’s 55th richest person, worth an estimated $9.9B, Ross is the owner and chairman of The Related Companies — the real estate investment firm that owns Equinox and SoulCycle. 

The Fall Out: Concerned that their dues are indirectly benefiting Trump, people are canceling their Equinox memberships and boycotting SoulCycle.

  • Equinox and SoulCycle responded with statements that declared Ross a “passive investor” not involved in the management decisions of the respective companies. 
  • The statement, and Ross’s refusal to cancel the event, did not satisfy customers, many of whom reside in liberal cities. 
  • Both brands are closely linked with people’s identity and sense of community. SoulCycle, for one, sells itself on “diversity, inclusion, and equality”, as well as statements like, “All souls are welcome.”  
  • Ross’s support of Trump seems to fly in the face of those sentiments, causing celebrities like Chrissy Teigen, Jonathan Van Ness, and Billy Eicher to publicly cancel their memberships. 

Meanwhile, fitness competitors including NYSC, Overthrow, Tracey Anderson, and Flywheel seized on the backlash, offering discounts and free classes in an attempt to convert fleeing members. 

Zooming out: All Americans are entitled to their own opinions and political views. And there are wealthy donors on both sides of the political divide. But given the current climate, those donations are likely to be under much closer scrutiny than ever before. 

Just how disastrous this boycott will be to Ross’s (or Equinox’s or SoulCycle’s) bottom line is yet to be seen. Nonetheless, all parties involved have their work cut out for them as they attempt to re-earn the trust of what was once a fiercely loyal customer base.

Headlines & Happenings

🏆 Oat-standing

Oatly, the Swedish oat milk maker credited with creating the category, can barely keep up with demand. Now, as the company sures-up US production, it turns its attention to world dairy-alternative domination. 

New milk on the block. As good ole’ fashioned milk combats slumping sales, replacement milks made from nuts, peas, soy, coconut, hemp, and rice are also getting a run for their money. The culprit? A creamy oat-based “milk” that has the mouthfeel of cow’s milk, minus the environmental and animal welfare concerns of dairy. 

  • Following the trend of “plant-based everything,” the global non-dairy milk market is projected to reach $38B by 2024.
  • US retail sales of oat milk have reached $29M, up from $4.4M in 2017.
  • Oatly, which launched in US coffee shops in 2016, did $68M in sales for 2017, $110M in 2018, and projects $230M for 2019.

In an attempt to keep up with demand, Oatly recently opened a $15M processing plant in Millville, NJ. Besides its two existing European plants, the company will add new production facilities in Utah and Singapore next year and anticipates the need for a third European location by 2022. 

Looking ahead: Oatly’s success has already spurred its fair share of copycats — Quaker Oats, Silk, Pacific Foods, Califia Farms, and Thrive Market are among a growing list of oat milk competitors. While it’s commonplace for upstart food and beverage brands to be acquired by Big Food companies like Pepsi Co, Danone, or Nestle, Oatly is unlikely to sell. According to Oatly’s chief executive Toni Petersson, if the demand sustains, the company could go public.

👟 Heathy on-the-go

As we detailed way back in Issue No. 1, healthy convenience stores like The Goods Mart, Clover Store, Bonberi, and WeMRKT have found a foothold in major cities like New York and Los Angeles. But now, the trend is spilling over into smaller and mid-sized markets. 

For background: Younger generations, including millennials but especially Gen Z, want healthier and more convenient food options. Similarly, these cohorts are willing to pay a premium for wellness-related brands and products. 

Having keyed in on this trend, Global Partners—one of the largest independent owners, suppliers, and operators of gas stations and convenience stores in the US—is getting in on the action. 

  • Global Partners, a public company on the NYSE, owns, leases, or supplies 1,600 gas stations and owns 296 convenience stores. 
  • The company did $12.6B in revenue for 2018.
  • Recently, the company debuted Alltown Fresh, a new concept that specializes in healthy food, including organic, natural, vegan, vegetarian and gluten-free options.
  • The first two Alltown Fresh stores have opened in Plymouth and Auburn, MA. In all, the company hopes to add six stores before year’s end. 

Takeaway: While so-called “bougie” convenience stores have received criticism for displacing mom-and-pop shops while helping fuel the wellness industrial complex, Alltown Fresh could represent a more approachable concept. If nothing else, this development—coupled with the news that 7-Eleven has begun to experiment with a health-forward concept—signals a willingness among retails to tailor their offerings to match the shift in consumer preference. Similarly, it represents an opportunity for health-focused CPG brands seeking new avenues for reaching potential customers.


  • Under Armour’s North America business is still struggling. 
  • Vegan restaurants in the UK are closing due to lack of demand. 
  • Lab-grown kangaroo... it’s what’s for dinner?
  • Nutrition science is broken. 
  • Gin Lane closed its agency to start Pattern, a “multi-brand consumer goods company”

💰 Money Moves

Snapdragon Capital Partners and The Maze Group acquired a minority stake in Nutraceutical, a manufacturer and distributor of nutritional supplements and personal care products.

Keep in mind, Snapdragon is the private equity firm behind Xponential Fitness — owner of Club Pilates, CycleBar, Pure Barre, StretchLab, Row House, AKT, YogaSix, and Stride. The implications for private label Xponential products or a vitamin subscription for members is worth watching. 

MADabolic, a HIIT fitness concept, secured growth capital from ZGrowth Partners, who acquired a controlling interest in the company. MADabolic plans to build on the success of its 10 existing gyms, reaching 30–35 locations by 2020 and 200 locations in the next five years.

Diageo acquired a majority stake in non-alcoholic spirits brand Seedlip. As one of the world's largest producers of spirits and beers, including Johnnie Walker, Smirnoff, Baileys, and Guinness brands, this move helps Diageo better target consumers who are opting out of alcohol and into wellness.

The Vitamin Shoppe is being acquired by Liberty Tax for $208M.

More From Fitt >> DTC Vitamins Are Up-ending Retail Supplement Shops 

Dadi, a male fertility testing and sperm storage company, closed $5M in funding.

Hazel Technologies, a food waste startup, closed $13M in Series B funding.

Baze, an at-home nutritional testing kit, landed $6M in Series A funding led by Nature’s Way.

Cronos Group will acquire four subsidiaries of Redwood Holding Group, owner of popular CBD beauty brand Lord Jones, in a $300M deal.

Nike acquired Celect, a retail predictive analytics and demand sensing startup. Terms were not disclosed.  

Wild Friends Foods, makers of nut and seed butter, secured an undisclosed investment from impact investor S CAP.

S CAP also made an undisclosed investment into Cusa Tea, a premium instant tea company.

Mother, a UK-based healthy vending machine company, received £3M in funding.

Curv Health, an AI-powered platform for tracking human movement, closed a $1.5M seed round.

Planet Fitness has reported a 29% increase in revenue for the first half of 2019. CEO Chris Rondeau said the company now plans to open between 250 and 260 new Planet Fitness locations this year, up from a projected 225 openings.

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