Two Fitness Companies Are Merging With Jared Kushner’s Backing
The parent company of ClassPass is combining with fitness-tech maker EGYM to capitalize on AI across the industry
The parent company of ClassPass, a workout booking app, is merging with fitness-tech company EGYM in a bid to create an industry leader in the fitness space with the backing of Jared Kushner’s private-equity firm.
The details
The transaction includes $785 million in new equity investments and is set to value the combined entity at $7.5 billion, including debt, executives told The Wall Street Journal.
ClassPass parent Playlist also owns Mindbody and Booker, two other firms in the fitness and wellness space. EGYM’s workout equipment and digital offerings use artificial intelligence to create personalized fitness regimens for users.
The fresh investment is led by Kushner’s Affinity Partners (already an investor in EGYM), the executives said. A consortium of the companies’ existing investors is also participating, including Vista Equity Partners, Singapore investment firm Temasek and consumer-focused private-equity firm L Catterton.
The context
Playlist and EGYM together brought in more than $800 million in net revenue last year. Both companies are also profitable, said Playlist Chief Executive Fritz Lanman.
The fresh funding will be used to invest in AI to help all of their brands engage more with consumers, said EGYM Chief Executive Philipp Roesch-Schlanderer. It will also allow the businesses to scale globally, he said, adding that EGYM is already a a significant competitor across Europe.
“The wellness industry has such strong secular tailwinds behind it,” Lanman said. “AI is only accelerating that.”
(Lanman and Roesch-Schlanderer are expected to be named co-founders of the new Playlist organization as part of the deal.)
Private-equity firm Vista acquired Mindbody—a software platform that helps gyms, studios and spas manage their businesses—in late 2018 for $1.9 billion. In October 2021, Mindbody acquired ClassPass in an all-stock deal that valued the combined entity at roughly $3 billion. Playlist, the new parent-company banner, was unveiled last year.
EGYM in 2024 raised roughly $200 million of growth capital at a more than $1 billion valuation from investors including L Catterton.