There are few things more exciting in the startup world than the prospect of becoming a unicorn. When a privately-held company’s valuation surpasses $1 billion, it is granted the elusive title for beating the odds and finding success.
A seven-year-old New York-based startup called ClassPass is seeking unicorn status heading into 2020 with a $285 million funding round. The company offers its subscribers the ability to attend fitness classes at different gyms. It currently has a valuation of $536 million according to Reuters. With a surge of gymgoers expected at the turn of a new year, ClassPass may be well on its way to becoming the next unicorn to watch.
The interesting thing about unicorn companies is that they usually aren’t as well-known as you’d expect. For example, those outside of the gym fitness world probably haven’t heard of ClassPass. Due to the attention-grabbing nature of today’s society, it is somehow easy for companies nearing a billion-dollar valuation to go unnoticed.
However, that doesn’t mean that ClassPass is obsolete. On the contrary, business is booming for the fitness tech startup.
It was founded in 2013 by Payal Kadakia. She now serves as the company’s executive chairwoman while Fritz Lanman now fills the CEO role. The company has raised more than $240 million from investors to date, including an $85 million Series D round that wrapped up in July 2018.
Backers include the likes of Alphabet, Temasek, General Catalyst, Thrive Capital, and Acequia Capital. The startup’s latest funding push reportedly began back in the fall of this year. It now plans to issue 22.7 million Series E shares in pursuit of $285 million in new funding. Should ClassPass reach that figure, its total valuation will surpass $1 billion in 2020, thus granting it unicorn status.
What is ClassPass?
For those who enjoy taking fitness classes at the gym, ClassPass is the best thing since sliced bread. It offers flexibility and convenience in a simple, cost-effective package. As of July, the ClassPass app has facilitated more than 100,000,000 reservations according to Kadakia. It partners with fitness studios in more than 2,500 cities across 18 countries.
ClassPass helps fitness junkies and causal users find classes that are tailored to their needs. It eliminates the need for searching across multiple websites for the right class by bringing it all into one place. Likewise, ClassPass eliminates the need for multiple gym subscriptions by allowing users to choose individual classes at different locations.
The startup originally charged $99 per month for unlimited fitness classes in New York City. However, now that it has spread out the subscription model has changed with it. Users now pay between $9 and $199 per month to get “credits” that they can use for various fitness classes.
Meanwhile, ClassPass is working to add a corporate wellness side to its business. The program will hypothetically personalize classes for employees and offer digital workouts that are available to stream.
With new funding on the way, it wouldn’t be surprising for ClassPass to reach its goal of achieving unicorn status in the early days of 2020. For those looking to get fit with a New Year’s resolution, ClassPass is a great way to get started.