INDIA — With the acquisition of Fitness First, Cure.Fit has become the second largest fitness chain in India, as it makes its move towards global expansion.
Launched just two years ago, its acquisition-focused growth strategy has seen it become one of the largest fitness and wellness companies in India. It’s recent acquisition of the Fitness First brand and its 10 outlets brings the company’s overall fitness outlet count to 50 across the country (40 from its existing Cult gyms), and 10,000 new customers have joined the existing 50,000 users of its online platform.
“The key reason we went ahead with this deal with Fitness First is because it has a strong presence in Delhi and Mumbai, two markets we had yet to penetrate into,” Cure.Fit Co-Founder, Mukesh Bansal told Business Standard at the time of the merger. The acquisition will reduce the company’s time to market in the two cities by roughly nine months, and is the method Cure.Fit plans to use in the future, to expand its presence in India and around the world.
Co-Founder Ankit Nagori confirmed plans to grow beyond the South Asian market: “Going global is one of the plans we are working on. Our investors believe that what we are offering will find a market abroad and we believe that it will happen within the next few years,” he commented.
Investment and funding
The terms of the deal remain undisclosed, but Oaktree Capital, which backs Fitness First, has become a minority shareholder in Cure.Fit. Fitness First customers will get additional access to all Cult centres, which offer equipment-less workout solutions, including strength and conditioning training, spinning, boxing, mixed martial arts, zumba and yoga.
Maple Capital Advisors was the sole financial advisor to Oaktree on this transaction, and Maple’s Founder and Managing Director, Pankaj Karna, told Inc42 in May that this “consolidation will create one of the best platforms in the industry, offering good value proposition with premium brands at one place and covering a rare spectrum of customers. Not only will Cult get new markets to grow and get a better positioning, I think it makes sense for the shareholders to be a part of this fast-growing spectrum.”
In July, Cure.Fit raised USD $120 million in its series C round of funding led by IDG Ventures, Accel Partners and Kalaari Capital with participation from Chiratae Ventures and Oaktree Capital. This brings the two-year-old company’s total funding to nearly USD $170 million.
Expansion through acquisition
The Cure.Fit health and wellness platform has four existing verticals – Cult.Fit, Mind.Fit, Eat.Fit and the most recent addition, Care.Fit, which provides primary care solutions. Eat.Fit is a subscription-based food delivery vertical and is servicing over 10,000 meals every day and doubling its number of orders every three months. Mind.Fit focuses on yoga and meditation.
Cure.Fit acquired Cult in August 2016 for USD $3 million and quickly started acquiring other boutique fitness brands and startups, including Tribe Fitness, yoga chain a1000yoga and Bengaluru-based Kristy’s Kitchen to launch its food business. Last year the company also signed Bollywood star Hrithik Roshan as its brand ambassador on a five-year contract.
With the sports, fitness and wellness market in India expected to grow to $90 billion by 2022, Cure.Fit’s holistic approach of blending all types of fitness services on one platform could dominate the market.
Once seen as a luxury category, wellness and fitness is increasingly expanding to the middle class in India who have rising disposable incomes. In addition, 47 percent of the population is below the age of 25 and this segment has access to information about health and fitness it wishes to act upon, both online and offline.
However, the market is still far from saturation, and with a population of 1.35 billion people, there are still plenty of opportunities for new players in India’s health and wellness industry.