Markets: Fitness Startup Xponential Files For IPO

A fitness startup that’s built a strong business for itself in just four years of existence by way of acquisitions…

Xponential logo

A fitness startup that’s built a strong business for itself in just four years of existence by way of acquisitions is about to exit on the public markets. It’s Xponential Fitness, a franchise owner of boutique fitness brands including Club Pilates and CycleBar.

  • Xponential has filed for an IPO with the US SEC. It intends to list on the New York Stock Exchange (NYSE) with the trading symbol “XPOF”.
  • Rumors have it that Xponential planned a public listing for last year but called off its plans after the Covid pandemic battered in-person fitness businesses. Now, its IPO plans are official and likely to go through.
  • From its SEC paperwork, Xponential revealed it has sold a cumulative 3,371 franchise licenses in North America since 2017. Also, it had ten franchise studios internationally and master franchisees contractually obligated to sell licenses for 693 more studios internationally, as of March-end.
  • From the above figures, it can be deduced that Xponential has a solid business in the US and is growing gradually internationally. It made $107mn in revenue for 2020, a bit down from $129mn in 2019 after the pandemic of 2020 hurt its business.
  • In the first three months of this year, Xponential brought in $29mn in sales, compared to $32mn in the same period last year. It reported a $4.8mn net loss for those three months.
  • Within just 4 years, Xponential has carved out a solid fitness studio franchising business for itself with acquisitions financed by private equity firm TPG, a major shareholder of the company. This March, Xponential made its biggest purchase of boutique boxing brand Rumble for a reported $300mn.
  • Now, Xponential is set for an exit on the public markets, with sizeable rewards to come for TPG, along with CEO Anthony Geisler. Geisler took an investment from TPG for his Club Pilates studio franchise in 2017 that morphed into Xponential Fitness and scaled up from there.
  • Word on the street is that Xponential is aiming for a $1.3bn valuation with its IPO. At that, the company has secured a $200mn private placement in conjunction with the IPO, from investors including Michael Dell’s MSD Partners, D.E. Shaw, and Redwood Capital Management.

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