NAYPYIDAW, Myanmar — Myanmar’s burgeoning fitness and wellness industry has received a boost in the form of a six-digit US dollar funding round by local fitness platform Flexible Pass. The round included participation from Asia venture capital firm Nest Tech, as well as Seed Myanmar and Yangon Capital Partners.
Founded in June 2017, Flexible Pass lets users make bookings at 80 locations in Yangon across 19 different fitness categories, including gym and fitness classes, swimming, indoor skydiving, rock climbing, paintball, laser tag, football, and bouldering. The platform has 1,000 users and has processed 10,000 bookings since its launch.
“We are the only fitness app in Myanmar at the moment,” explains Sully Bholat, Founder and CEO of Flexible Pass. “The fitness market is small here compared to other countries like Singapore, Indonesia, and Malaysia. You can’t really grow outside of Yangon except to Mandalay, the second biggest city. Foreign competitors like ClassPass and GuavaPass aren’t coming into Myanmar yet.”
When Bholat returned home to Yangon in 2016 after studying a Bachelor of Business Management in Australia he was inspired to launch his own business. Despite two large gyms having opened in Yangon towards the end of 2016 – Power House Fitness Club and Training Ground Myanmar – it was the startup and technology sectors that primarily inspired Flexible Pass, rather than fitness and wellness.
“When I moved back to Myanmar there was a lot of startups emerging and we had our first ever accelerator. There was a lot of investment, and in April 2017 Grab and Uber came on to the market at the same time — the country felt ready and more familiar with apps and technology,” notes Bohlat.
It was around that time Bohlat and his idea graduated from the accelerator Founder Institute run through Phandeeyar in Myanmar, and Flexible Pass began to win awards, including ‘Start-up of the Year’ in 2017, and ‘Best HealthTech Start-up of the Year’ in Myanmar, in 2017 and 2018.
Now, with the backing of investors, Bohlat plans to expand to Mandalay and develop into new sectors such as beauty and lifestyle.
“The next step is to leverage our model to move into other lifestyle categories like spas, wellness, and beauty services. That’s what other startups like KFIT and ClassPass have done,” says Bholat. “With our application, people will be able to book spa treatments and beauty services using our existing points system.”
Testing a new market
Flexible Pass wasn’t always based on a points system. Initially, Bholat followed the model of other fitness apps by offering monthly memberships with unlimited classes across all locations, but with a limit on attending one location no more than three or four times. However, despite other Asian markets being quick to adopt this approach, the Myanmar market wasn’t receptive.
“In Myanmar people weren’t happy with that model because there’s a lot of traffic and places can be very far away from one another. People here prefer to work out at one or two gyms only. We had difficulties in the beginning, but we quickly pivoted to our current points-based model and people are pretty happy with it,” explains Bholat.
Another major challenge was payment – credit cards are not widely used in Myanmar. The company had to find alternative methods to receive payment via cash and bank transfer, which meant having to overcome a lot of trust issues, from customers and vendors alike.
“We had to build a reputation,” Bholat explains. “In the beginning, it was difficult to convince the gyms to join the platform because they are so used to traditional models. For instance, right now we are trying to convince a gym to charge less during off-peak hours, so users can go in for cheaper and the gym can still get revenue from an empty space, but it makes them nervous,” he adds.
Despite the challenges, with no competitors in sight, Bohlat has the ability to educate customers and vendors in their own time and on their own terms. With a first-mover advantage, the entrepreneur hopes to continue to scale Flexible Pass into a sustainable, long-term business.