SPAC insanity has hit another billion in the latest example of empty check companies that have gotten new members of the three-point club. The Santa Monica-based Beachbody – an exercise DVD-and weight-loss-shake-hawking multi-level marketing business – has become an online fitness brand – went public on Monday in New York, along with Myx Fitness and Forest exercise bike maker. Road Acquisition Corp., a white check company linked to former NBA star Shaquille O’Neal and former TikToke CEO Kevin Mayer. Beachbody CEO and Carl Daikeler, the company’s founding president in 1998, is now a billionaire with a 44 percent stake, valued at $ 1.7 billion at 9:45 a.m. Monday.
The merger’s goal is to make the new company a direct competitor to major fitness brands like Peloton and Lululemon — it bought Mirror fitness device maker in June 2020 for $ 500 million in June 2020 — combining Beachbody’s fast-growing digital subscription business and library. live and on-demand training classes with an exercise bike equipped with a Myx touch screen, a cheaper alternative to the Peloton. Myx’s exercise bike is listed on its website for $ 1,299, compared to the $ 1,895 unpacked Peloton bike.
Myx Fitness has just arrived and is a little fried in the world of exercise bikes. It had a whopping $ 30 million in sales of bikes in 2020, the first year of sales. Beachbody, on the other hand, had a net loss of $ 21 million in sales of $ 864 million in 2020, less than the net profit of $ 32 million in revenue of $ 756 million in 2019.
“This is an important milestone in Beachbody’s mission to help more people achieve their goals and lead healthier and healthier lives,” Daikeler, 57, said in a statement announcing the merger on Monday. “With this transaction, we will expand our capital to increase our platform, add connected fitness hardware by purchasing Myx and continue to create the most exciting and innovative home fitness content.”
A Beachbody spokesman did not respond to Daikeler’s legacy.
As Forbes As specified in a 2018 article, Daikeler grew up outside of Philadelphia and graduated from Ithaca College in 1986 with a degree in corporate organizational media. He then worked as a producer for rest sessions on television football games. In 1987, he stopped making fitness ads, a business that later turned into fitness workouts filmed in the 90s. He founded the training video game company TelAmerica Media in 1994, selling 2 million copies of the hit video “Buns of Steel,” before selling his stake and returning to the commercial world. After two years in a telephone dating service and Lasik’s eye surgery referral service, he founded Beachbody in 1998 with colleague Jon Congdon and $ 500,000 angel investors.
“What I’ve learned has been that solving my problem (which I don’t like when I train and eat like a high school student) has been a scalable option,” he said. Forbes In 2018, its stake in the company was valued at approximately $ 660 million.
Beachbody’s first successful hit was the P90X, a three-month boot camp that has since been praised by former U.S. House spokeswoman Michelle Obama and Paul Ryan. Daikeler and Congdon turned the company into a multi-level marketing giant, with more than 400,000 “coaches” selling training videos, weight loss shakes and other accessories on social media. In 2015, Daikeler made a risky bet by launching Beachbody on Demand, a service like Netflix, which offers the company’s full library of training videos (if you buy all $ 7,000) for $ 99 a year. Although it was painful in the short term — the number of coaches rose from 450,000 in 2016 to 340,000 in 2018 — the strategy paid off in 2020, when pandemics shut down gyms across the country and turned people into live play and home training.
In early 2019, Congdon created Openfit, another live fitness class service priced at $ 19 a month and owned by Beachbody, which also launched in 2020 and helped the company’s digital paid subscription grow by 53% to 2.6 million, according to Peloton 3 compared to millions. (Congdon’s approximately 6% stake in Beachbody is worth about $ 220 million at 9:45 a.m. ET). Live fitness allows Beachbody to diversify beyond healthy foods, supplements and its Shakeology drinks, which in 2019 brought in two-thirds of overall revenue. The vibrating business, however, underwent a legal review a few years ago: in a 2017 investigation by a Santa Monica city attorney, the company reached an agreement to pay a $ 3.6 million settlement and agreed to stop making some health claims about its shakes. Still, the company is investing more in the food market with a celebrity-sponsored healthy food game: In December 2020, LeBron James and Arnold Schwarzenegger bought sports food company Ladder for $ 28 million.
Although Beachbody had an improvement of $ 756 million in sales in 2019 from $ 864 million last year, Beachbody said they represent a significant $ 1 billion decline Forbes In 2017 he had an income. Joining Myx Fitness allows Daikeler to cover its bets by relocating Beachbody to compete with Peloton, an integrated home fitness company, and iFIT, NordicTrack and ProForm.
“In the same way that streaming opened up the media world, it’s opening up an ecosystem of home fitness exercises,” says Simeon Siegel, a senior analyst at BMO Capital Markets. product and engaging content “.