The At-Home Fitness Roll-Up
In an email exchange the other day, a friend and fellow investor in early stage fitness and sports companies made the comment that the at-home fitness market may be hitting the peak of its “Uber for X” curve — meaning, tons of company formation and an (over)abundance of capital riding a wave of enthusiasm because of the success of one or two key companies (in the case of fitness, Peloton).
As with the Uber for X market trajectory, the idea is that derivative ideas will either fail to take off (Uber for Car Washes…), or if they are attractive enough, be partially eaten up by the bigger players (on demand food delivery, for example).
With the news of Tonal’s Series C funding round *, led by L Catterton, we are starting to see early indications of another parallel between the respective markets pioneered by Uber and Peloton: The Roll-Up.
Roll-ups — or what Bain has called the “Buy and Build” strategy — have become very prominent in traditional private equity and have been employed to extreme success in the SaaS world by firms like Vista and Constellation Software.
The strategy tends to work well when the group of companies being brought together are…
