Popular fitness class marketplace ClassPass announced this week that it has been acquired by studio management software provider Mindbody in an all-stock deal.
Headquartered in NYC, ClassPass initially launched in 2012 as a way to book classes à la cart from a variety of studios and gyms in a given user’s area. It has since moved to a monthly subscription model, giving users access to a specific number of classes for a flat fee. In addition to things like yoga and strength training classes, the startup also lets people book wellness activities like massages and pedicures. Today, ClassPass says it has more than 40,000 gyms, spas and studios in its global network.
Meanwhile, Mindbody is often described as the OpenTable of the fitness and wellness world, providing a booking solution used by studios, gyms, spas and salons all over the world. Together, the combination of Mindbody’s marketplace and ClassPass’ network will create “the most extensive and integrated platform in the industry,” according to a recent press release.
“Since the founding of ClassPass, our north star has always been how we can help people discover and seamlessly book soul-nurturing experiences,” ClassPass founder Payal Kadakia said in a statement, describing this acquisition as a “massive milestone” for a woman-founded company.
The financial terms of the deal were not disclosed, however ClassPass was most recently valued at north of $1 billion back in January of 2020 — shortly before the pandemic hit the United States. Alongside the acquisition, Mindbody announced that it received a $500 million strategic investment for the newly merged entity, led by global investment firm Sixth Street.
By joining forces, ClassPass CEO Fritz Lanman said in a statement that both it and Mindbody will create a more “seamless” experience for its users and “unlock new revenue opportunities” for its customers. ClassPass studios that are not already using a booking software will have the chance to sign up with Mindbody, and Mindbody’s consumer-facing business will have access to ClassPass subscriptions and gain access to its studios.
Lanman, who will serve as president of ClassPass and Mindbody alongside Mindbody’s CEO Josh McCarter and executive team, told TechCrunch that ClassPass’ network will not be required to use Mindbody, and vice versa. Lanman also told the publication that there are no redundancies or layoffs planned. In fact, ClassPass is actively hiring.
Of course, this news is coming on the heels of a decidedly tumultuous year for in-person gyms due to the pandemic, which has led to massive success for at-home fitness giants like Peloton and Tonal, as well as up-and-comers like Hydrow and Liteboxer.
While ClassPass does offer virtual classes, it is confident that IRL workouts are “back and here to stay,” according to a recent report, claiming that nine of the app’s top 10 classes are in-person. Mindbody seems to feel the same way, and said in its press release that usage of its platform has rebounded to pre-Covid levels in markets that have fully reopened. ClassPass’ subscriber usage is reportedly at 110 percent of its pre-Covid levels.
“This acquisition comes at a pivotal time for the wellness industry as it continues to rebound from Covid-19-related closures,” McCarter said in a statement, adding that “local and authentic” fitness experiences are more important than ever. “By leveraging the best of both companies’ technology and expertise, we are more committed than ever to providing studios with best-in-class tools to help them grow and thrive, while also driving more consumers to their business.”
