Gympass.com is a corporate well-being platform that provides users with access to thousands of premium gyms, studios, wellbeing apps, and group fitness classes taught by world-class instructors. It currently has a huge userbase with many big corporates such as Accenture, Unilever, KPMG as their clients.
As you can imagine, this brings in a lot of revenue for Gympass. But how exactly does it make money and what is their business model? Let’s find out.
Gympass makes money from the fees employers pay to use its platform. This profitably allows the company employees to get discounted rates to any gym or wellness provider on the Gympass platform.
What is Gympass?
Gympass is a global wellness benefits platform. It helps companies engage their employees in fitness activities by offering them unlimited access to the largest network of wellness providers in the world, including gyms, yoga studios, boot camps, fitness classes, virtual therapy, and more.
Gympass is not just another corporate wellness program. It is a global fitness pass, making it possible for customers to make physical and emotional wellness a daily habit.
GymPass gets its major chunk of revenue by offering a prepaid membership as a corporate wellness benefits plan that covers exercise venues and classes to provide users with an easy-to-use, all-inclusive program to stay fit.
Founded in 2012, Gympass is headquartered in Sao Paulo, Brazil, and relocated to New York, with offices in Los Angeles, San Francisco, Chicago, Atlanta, and other major geographies.
The fitness-focused start-up became a unicorn in 2019 when it raised $300 million in strategic funding.
In June 2021, the company raised a Series E $220 million venture funding from an international syndicate of investors led by SoftBank and including General Atlantic, Moore Strategic Ventures, Kaszek, and the Valor Capital Group.
Value Proposition
If people can’t get to the gym, it’s time to bring the gym to people.
That’s the value proposition for Gympass, which makes fitness simple and convenient for gym-goers, and it lets employers boost their corporate wellness programs.
- Gympass is a one-of-a-kind ‘universal gym pass’ to partnered fitness facilities in over 1,200+ cities worldwide. Members can enjoy a variety of options, including access to premier facilities and exclusive offers.
- The platform aims to help improve the quality of life of people through available and accessible fitness options.
- It offers subscriptions as an employer benefit program and allows employers to provide employees with monthly passes that can be used at the gym for access to various fitness classes. There are three membership tiers that vary in pricing and access to facilities.
Benefits for Employers
Gympass utilizes practical, common-sense approaches to workplace fitness.
It recognizes that companies need a return on investment (ROI), and a value proposition that provides incentives for their employees to physically engage in activities, outside of the usual work schedules.
Gympass’ unique enterprise benefits address the well-being needs of today’s over-worked professionals. This is done while helping organizations maintain a competitive advantage in their industries, saving them costs, and also encouraging a healthier lifestyle within the workforce.
Benefits for Employees
Gympass was founded in 2012 with the vision of bringing fitness to everyone at an extremely affordable price through strategic partnerships.
Using the Gympass mobile app and website, members find studios nearby that offer individual sessions, group training, and high-quality personal trainers for accountability and motivation.
They can book their favorite fitness classes and activities such as yoga, dance, cycling, aqua fitness, Pilates, strength training, and many more both on the desktop and smartphone.
After logging in to the platform, users can find out the latest offers according to their location and preferences.
Benefits for Fitness Partners
Gympass is an innovative health and wellness platform that provides gyms and fitness facilities with new ways to attract members, gain revenue and build their businesses.
It does this by integrating the online portal and mobile phone app to offer a unique experience to end-users. Gympass users have access to thousands of participating gyms across the United States and other major geographies.
The Man Behind GymPass: Cesar Carvalho
Inspired by his own experiences as a stressed-out professional seeking a way to balance work and lifestyle, Cesar Carvalho, a former consultant for McKinsey’s Brazil division, came up with the idea to create Gympass as a corporate wellness product.
He had joined Harvard University as part of his professional advancement program. GymPass was a result of dedicated innovation and his keen desire to maintain a healthy fitness regimen amidst his tight work schedules.
Initially, GymPass started as a DTC(Direct-to-Consumer) model, with the idea of selling daily gym passes to its users. However, the company decided to enter into the B2B segment, within nine months of launch. PwC was the first corporate member to bring about 500 registrations.
This was a fortunate twist in the GymPass startup trajectory. It opened up a whole new marketing channel for them. The gym membership-selling model to corporates proved to be very lucrative, ultimately resulting in a $220 million Series E funding round at a $2.2 billion valuation, as of 2021.
The team was able to raise money on the promise of expansion and growth, and they have delivered (though growing from $0 to $2.2 billion is still quite an achievement!).
Carvalho is a firm believer in technology and wants to facilitate people’s access to a variety of health and physical activities and to provide them with the tools they need for staying on track.
GymPass has since then launched operations in major cities and geographies- Mexico, New York, Los Angeles, San Francisco, Chicago, Atlanta, Miami, Nashville, St. Louis, Houston, Europe, and more recently across other Latin American countries.
How Does GymPass Make Money?
GymPass, the Brazilian fitness and wellness unicorn for businesses, partners with employers who pay a flat fee for a platform and app that allows their employees to select from multiple wellness plans.
It gives them unlimited access to a global network of wellness providers, studios, directories, and health apps like Calm, at a subsidy of up to 70% off retail membership prices.
The offerings are broken up into the following categories: physical health, emotional health, nutrition, and sleep.
GymPass offers three kinds of subscription plans to customers with access to a variety of studios, gyms, and spas available on the company’s website and its Android and iOS apps.
The Starter membership comes at $9.99 per month, with access to 800 fitness facilities whereas the second tier of membership costs $79.99 monthly. The Gold Membership offers premium benefits to 7000+ facilities and is priced at $139.99 per month.
The model is especially useful during periods of business travel which means that employees can comfortably continue their fitness routine while staying overseas or on business trips.
This access is on a 24/7 basis and does not require long-term contracts or penalty fees for cancellation, thereby keeping matters flexible.
The company’s main revenue streams come from the impressive roster of clients including the world’s biggest corporations and most recognized vertical markets.
Keeping up With the Times
The UK is in a pandemic exercise crisis and its effects have been devastating to small businesses, especially wellness and gym facilities.
GymPass has risen to the occasion and wanted to serve its customers the best. Hence, it recognized and addressed the need for physical activity and mental health needs via its GymPass Wellness Collection.
Their model is to give clients of these closed fitness facilities access to the staff as well as the ability to work out in smaller groups. The app allows HR managers to deliver wellness solutions across their entire workforce.
The company posted significant check-in figures of 4 million per month in May 2021, across all of its fitness partners and facilities, going so far as to surpass pre-Covid figures.
Further, the usage of the Gympass app in the US has increased by more than 2x since its launch in March 2018 in 12 key markets.
It is growing across its network of more than 50,000 global partners and now features more than 15 fitness brands such as SoulCycle, Gold’s Gym, Solid Core, and NYSC as well as all local brands.
The CEO of GymPass, Mr. Marshall Porter has spoken at length about the new wellness packages recently introduced by the company in the wake of the pandemic and limited social interaction.
The new digital offerings meet a variety of needs for both employers and their employees in the aftermath of the pandemic such as virtual classes and personalized wellness coaching.
Virtual therapy helps people develop better mental health. Overall wellness will help address physical fitness, nutrition, and sleep. Streaming live classes and one-on-one personal training are customized to individual employee needs.
Operations, Funding & Expansion
GymPass has built proprietary tools to track and manage each user in the Gym network, initially focusing on consumer behavior, corporate contractual agreements, financial reporting, and operational management.
The company uses machine learning algorithms, analytics, and artificial intelligence to drive data and insights into customer and corporate behavior.
GymPass has made key strategic hires that have allowed the company to diversify into new areas of the fitness industry. These include an experienced leadership and marketing team that have led large businesses to significant growth within fitness.
Gympass is currently available in 14 countries with more than 2,000 corporate customers and 50,000 fitness partners. The platform offers fitness classes and corporate wellness programs to over 5000 users and has access to over 47,000 gyms and studios in over 14 countries.
In June 2018, a $300 million financing round led by SoftBank Group Corp boosted Gympass’s international business to a market value of $1 billion.
Following the pandemic, the company experienced unprecedented growth as they continued to offer unique solutions that made people healthier.
In June 2021, Softbank and other notable conglomerates such as General Atlantic, Moore Strategic Ventures, Kaszek, and the Valor Capital Group came forward to invest $220 million in Series E funding for its mission to improve wellness on a global scale.
This took up the fitness tech startup’s valuation to $2.2 billion, and the funding was mobilized for expansion of the company across the United States and also for innovation and improvement of its core product.
Furthermore, with rising health costs, patrons are charting new payment avenues to fulfill their fitness goals.
GymPass leverages this market proposition by offering members a convenient way to attend gyms across major cities by leveraging local and national corporate partnerships that allow it to discount membership fees at partnered gyms in a given area.
GymPass Competitors
Gympass really is a great deal.
It allows you to access thousands of fitness classes and workout studios in the US and Canada. This is more than enough to help you reach your fitness and health goals.
After all, no matter how much money you have – it’s hard to do workouts if they aren’t accessible.
But there are quite a few alternatives to Gympass that can also help you stay fit.
ClassPass
ClassPass works on a DTC(Direct-to-Consumer)model.
Located in the United States, ClassPass offers businesses a way to offer their employees discounted gym memberships through ClassPass Credits without purchasing traditional memberships or increasing their out-of-pocket costs.
PeerFit
PeerFit is a revolutionary fitness company that allows users to attend classes at studios through a single pass.
FitPrime
FitPrime is a membership marketplace that allows users to find and book fitness classes at various fitness facilities.
Classes are arranged on a subscription basis, which ensures that studios always have full attendance, and also helps customers save money. Their app is available for iOS & Android devices.
Urban Sports Club
Urban Sports Club is an app for finding venues and booking classes on-demand for sports and fitness activities. The service offers a wide range of activities, including yoga, sports coaching and training, and more.
GymPass Customers
Gympass is an up-to-date solution for people who seek a healthier work-life balance.
Working under a modern business model, the company incentivizes gyms, fitness studios, and fitness trainers in such a way that all parties benefit from memberships and new users are attracted by the attractive prices.
80% of the fitness facilities in Sao Paulo are Gympass partners. The clients of GymPass include global companies such as Unilever, Procter & Gamble, Deloitte, Ernst & Young, Rolls Royce, and the UK retailer Tesco.
Conclusion: How Does Gympass Make Money?
Selling gym memberships can be hard especially with the increasing competition. But Gympass has used its brand and word-of-mouth marketing techniques to tap into this market with great success.
The startup has shown its potential and has grown its community in South America and the U.S., climbing to the top of the fitness service space.
Although there are other players in this space, including startup Classpass, Gympass appears to have sounder fundamentals, which could help it gain market share and continue growing.
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