Add Xponential Fitness to the fitness brands considering going public, according to a report by Bloomberg.
Xponential, Irvine, California, is an aggregator of nine boutique studio brands: AKT, Club Pilates, CycleBar, Pure Barre, Row House, StretchLab, Stride, YogaSix, and the recently purchased Rumble.
Xponential reportedly had been considering an initial public offering (IPO) in early 2020 but put that on hold due to the COVID-19 pandemic and mandated shutdowns of businesses to stop the spread of the virus. But Bloomberg reports that sources say CEO Anthony Geisler and the company’s other investors Snapdragon Capital and L Catterton are again considering an IPO, which sources told Bloomberg could list the value of the company at $1.3 billion. Geisler told Bloomberg that despite the 2020 studio shutdowns, outdoor and digital workouts allowed the company to post $435 million in revenue from franchisees last year.
Xponential Fitness declined Club Industry’s request to comment on the report.
It would be logical for a successful franchised-based company to want to access the public equity markets, Rick Caro, president of consulting company Management Vision, told Club Industry. Xponential has a solid story with an enviable growth strategy, both in the United States and on the international side, he added. It now has nine brands and the ability to combine packages for franchisees. It has built its infrastructure, so it is poised for major growth coming out of COVID.
“I believe this public company direction has been the plan from the beginning for its CEO and board,” Caro said. “It will allow them to access capital for faster growth and be able to show a consistency of increased earnings.”
Xponential Fitness opened 250 locations in 2020. In January, Xponential Fitness landed three of its eight brands on the Entrepreneur Franchise 500 list: Club Pilates (No. 104), Pure Barre (No. 119) and CycleBar (No. 351). In addition, five of the 12 fitness franchises on the Entrepreneur’s 2021 Fastest Growing Franchise list are owned by Xponential Fitness (Row House, StretchLab, Pure Barre, CycleBar and YogaSix).
Earlier this month, a Sportico article reported that Equinox Holdings (which owns brands Equinox, SoulCycle, Blink and others) is considering going public through special purpose acquisition companies (SPAC).
Currently, the only public fitness brand is Planet Fitness, Hampton, New Hampshire.
Other fitness brands have been public companies in the past. After going public with an IPO in 2006, Town Sports International was delisted from Nasdaq in 2020 after financial difficulties that caused it to file for Chapter 11 in September. YogaWorks went private in July 2019 after just two years as a public company. In October 2020, YogaWorks filed for Chapter 11 and closed all its studios. Life Time was a public company from 2004 to 2015.