Our investment thesis in VOLAVA
As a VC, one of the most rewarding parts of my job is that, every once in a while, you get a feeling that you just scored court-side seats to a major technology-enabled transformation. I just recently felt that way when we decided to invest in Volava.
If you have been following Peloton and its recently-announced $8B IPO, you’ll probably agree with me that digital fitness is an enormous market. Hundreds of thousands of Americans have already bought-in to the idea that you no longer have to organize your day around your local gym’s spinning class schedule, nor schlep your workout bag downtown just to burn some calories. Now I can compete with my friends in Barcelona from the comfort of my summer house in Empordà.
John Foley, founder and CEO of Peloton, realized that all it took was highly-curated content delivered to a large HD screen mounted to the handlebars of a spinning bike, and you no longer had to deal with the frustration of losing the last spot in spinning class to the local gym meat-head. The result is a product that delivers a super-engaging experience while creating a new market category: Digital Fitness or “The Peloton of X”.
In case you were wondering how much room we believe there is in Europe for a company in this new space we thought we’d share our investment thesis in this post. It comes down to three important reasons:
I.An inspiring founder. Joel Balague is the right CEO at the right time. He’s a true believer, an uncompromising product Zealot who has managed to build an extensible platform that is already being ported to two additional sport disciplines. Like John, Joel has no previous experience in fitness, media, or technology, and that’s what’s allowed him to break the rules and challenge the presumed incumbents.
- Eager customers. While Peloton has succeeded creating the Apple of fitness, with its heavily branded ecosystem, we believe there is room for an open platform that can make the technology and content creation know-how available to existing OEMs, enabling them to close the gap with Peloton. Volava has already inked exclusivity contracts in the US which will have the added benefit of a quick cash influx, which allows Joel to grow the business efficiently from a capital spent view point.
- An untapped market. Peloton has its hands full in the US and has just landed in the UK. Volava is extremely well positioned to capitalize on the demand that digital fitness is creating in continental Europe. Testimonials from the first customers Volava has signed in Spain and a few other countries point to a good product-market fit. The cost of acquiring early adopters has been surprisingly low, and we hope that riding Peloton’s demand generation coat-tails will help us maintain reasonable customer acquisition economics.
Digital fitness is here to stay and Volava, like Peloton, is just the tip of the iceberg. If you don’t believe me, I dare you to get on a Volava bike and resist the temptation to ordering one on the spot. Myself and a few of my colleagues at Inveready couldn’t resist. I am very much looking forward to seeing you in my next workout session. Try and catch me on the leader boards before it is too late!
