With personal fitness classes on the rise, Mindbody said it will purchase ClassPass as part of an all-stock deal.
Mindbody is often referred to as something like OpenTable of the fitness world: gyms and gyms use its backend software to organize classes and bookings. ClassPass, on the other hand, is used by consumers to sign up for training courses on a subscription basis. More recently, ClassPass has expanded to work with beauty salons and other wellness providers.
Financial terms were not disclosed. However, Axios announced that Mindbody will own between 60 and 70% of the combined business. Before the pandemic, ClassPass was worth more than $ 1 billion. In 2019, Mindbody was privatized by Vista Equity in a $ 1.9 billion buyout.
“The future is hybrid,” said Fritz Lanman, CEO of ClassPass, on Thursday in CNBC’s “Squawk Box”. “There are some people who really want to be digital [workouts], some just want personal, and some want both. “
“The elegance of this partnership is that ClassPass offers a digital product solution for those who want it, as does Mindbody,” added Lanman. “But … consumers are eager to get in touch in person, we know that.”
The merger will create something of a one-stop shopping experience for businesses and consumers to get their fitness levels at thousands of boutique studios and gyms across the country.
As part of this deal, studios on ClassPass that have not previously used booking software can now register with Mindbody. And for Mindbody, its customer-centric business will have access to everything ClassPass has to offer.
Josh McCarter, CEO of Mindbody, says the company’s next plan is to expand internationally and invest in a stronger corporate wellness offering. Also on Wednesday, global investment firm Sixth Street said it had agreed to invest $ 500 million in the merged business.
“This funding positions us really well to consolidate the industry and invest in our own product development,” said McCarter.