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Rick’s Media Picks – Fitness is Content

By Rick Alessandri, Managing Director at TurnkeyZRG

Keep, the China-based fitness and workout app, is the latest beneficiary of the gym closures due to COVID and the subsequent home fitness boom by companies like Peloton, Tonal, NordicTrack, and Echelon, as SoftBank led a $360 million funding round. Keep, started in 2014, has 300 million registered members and averages 38 monthly active users. In addition to the company’s indoor workout plans, it also released its own exercise bike in 2019, like category-leader Peloton.

Due in large part to the pandemic, Peloton’s shares grew 434% and was the 3rd best performer in the NASDAQ 100 in 2020. Peloton’s subscribers growth reached 3.3M in 2020 up 700K members in the last six months and it continues to invest in building out of the portfolio of fitness-based products beyond its cycle. Echelon, another rapidly growing competitor, closed 2020 with a $65M funding round led by  Goldman Sachs and North Castle Partners. As for Echelon, over the last three years, the company has brought over a dozen connected products to market, including their fitness apps. The TN-based company offers a content library of nearly 5,000 on-demand classes, led by their team of Echelon trainers streamed to their rapidly growing community of over 100,000 users.

At the core of Peloton’s business is a vast content engine of over 17,000 classes that fuel their 3.3M members. Peloton has also made celebrities of their high-energy instructors who have developed cult-like followings and are followed on social media by their loyal members. Peloton continues to aggressively grow its content base by adding workouts that can be leveraged on the Peloton app across Roku, Fire TV, Chromecast, and other IP-based platforms. In addition to the traditional cycling classes, new content includes yoga and meditation as well as stretching, boot camp, and others.

I believe that as these fitness/content companies continue to expand their offerings and reach on a global scale, their organizations will continue their transformation into media companies where the primary focus will be on retention of their subscribers and hence continued deep development of rich and engaging content will be vital.  Watch as these companies begin to hire from traditional media companies where programming executives who have built their careers on engaging consumers and increase time spent viewing is the lifeblood. I would not be surprised to see lifestyle programming content to find its way into the ecosystems of these companies.

Finally, will the fitness category and its content-based offerings slow their rapid growth once a COVID vaccine is widely distributed and businesses see their workers return to offices? Or will the category continue to see new connected products and content expansion?  When will consolidation begin to happen and who will be left standing?

Related articles:

https://www.bloomberg.com/news/articles/2021-01-11/softbank-leads-new-funding-round-for-2-billion-fitness-app-keep?sref=fypBllPq

https://seekingalpha.com/article/4398157-peloton-one-of-2020s-best-performers-repeat-in-2021

https://www.prnewswire.com/news-releases/echelon-raises-65-million-furthering-goal-to-put-innovative-connected-fitness-within-reach-for-more-consumers-301198643.html

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Founded in 1996, TurnkeyZRG is a highly specialized talent recruitment/executive search firm filling C-level, senior-level and mid-management level positions throughout sports, entertainment and media. Over the past 25 years, TurnkeyZRG has filled more than 1,400 positions throughout sports, entertainment and media. TurnkeyZRG helps teams, leagues, stadiums, arenas, theaters, college athletic departments, events, sponsors, agencies, media companies, private equity companies and other clients identify, recruit and hire the very best management talent. Turnkey now benefits from ZRG’s global footprint, full array of industry practice groups, data-driven, analytical search tools, and technology investment in changing the way executive search/talent recruiting is done. TurnkeyZRG becomes a tech-enabled disrupter of the prior executive search model. For more information about TurnkeyZRG, visit www.turnkeyzrg.com.