Exercise startup Peloton, known for streaming spin classes for its indoor bikes, has registered to go public, joining a crowded field of tech companies that have or will join the public markets this year.
Like many of its tech peers, Peloton appears confident in its plans for a public offering, despite not yet being profitable. In its registration documents, the company reported that it had made $915 million in revenues in the past fiscal year, a significant jump from the $435 million it produced the year before, but ultimately saw net losses of about $196 million, about quadruple its previous net losses of $48 million.
Founded in 2012, Peloton produces high-end, internet-connected stationary bikes and treadmills that work in concert with its streamed exercise classes. Bike packages approximately start at $2,200 (including delivery) while the treadmills begin about $4,300. Required content subscriptions are $39 a month. The company also offers a $19.49 option that lets users stream classes on mobile devices or a computer.
Since 2016, Peloton has seen its subscriber base grow from 107,000 people to more than half a million.
"Peloton's a really interesting case. This has been a year — obviously — of a lot of high-profile IPOs already," Joshua Franklin, a corporate finance correspondent at Reuters, told Cheddar on Wednesday. "Peloton kind of gets a little bit of the good stuff that people have liked about IPOs so far this year, and also a little bit of the stuff that people aren't so wild about."
He pointed to the Peloton's subscription model, revenue growth, and focus on disruption in the fitness space as potential positives for investors. On the other hand, Franklin cautioned that: "They don't specify in their IPO filing how they're going to reach profitability. And we've seen with Uber and Lyft, that's something that investors really are quite focused on these days."
In going public, the startup hopes to appeal to investors with a multifaceted business model. It has framed itself as a fusion of a media, fitness, and tech company, producing interconnected hardware, platform, and content. In the prospectus made public today, it says: "We are a technology company that meshes the physical and digital worlds to create a completely new, immersive, and connected fitness experience.
Peloton also says it's an "apparel" and "social connection" company because it sells branded clothing and incorporates a messaging feature into its streaming platform.
Unlike popular spin class brands SoulCycle and Flywheel, Peloton does not rely on physical locations. It runs a small number of studios where the startup films the content it streams online, but in its filing the company said revenue from classes at these locations "has been immaterial to date."
The startup appears to have inspired — or at least, catalyzed — an emergence of similar businesses. Mirror, founded in 2016, sells vertical, in-home screens that stream live exercise classes. 2017 saw the introduction of Hydrow, a startup that sells modernized rowing machines that stream rowing classes.
Meanwhile, Equinox Group has announced its plans to sell an at-home bike that will feature SoulCycle spin classes. Flywheel has also started selling their own home bikes with coordinated, live-streamed content, a move that has earned it a lawsuit over a patent dispute with Peloton itself.
IBM's spinoff, Kyndryl, is officially an independent public company. The $19 billion business is now listed on the NYSE under the ticker KD, becoming one of the largest players in the IT services market. David Wyshner, CFO of Kyndryl, joined Cheddar to discuss what this milestone means for the company moving forward.
Emma Searson, an author on the just-released Renewables on the Rise report and the director, 100% Renewable Campaign at Environment America, joined Cheddar to discuss the rapidly growing renewable energy sector. Between 2011 and 2020, the report shows that wind, solar, and geothermal energy production grew about 15 percent annually and that wind and solar alone account for 11 percent of electricity in the country. "There are a few really important drivers of the renewable energy progress that we're seeing all across the country," Searson said, highlighting falling prices, technology improvements, and supportive policies.
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Professional sports is facing a reckoning right now over several stories painting an ugly picture of a toxic work environment, encompassing multiple teams in multiple leagues and dealing with different issues.
This week, the NHL's Chicago Blackhawks ousted their general manager and senior director of hockey operations after an investigation confirmed former player Kyle Beach's claims that the team's former video coach Brad Aldrich sexual assaulted him back in 2010, with upper management ignoring his claims until after the team won the Stanley Cup that season. Last night, Joel Quenneville, now the coach of the Florida Panthers but Chicago's coach that season, stepped down from his post.
This comes just a few weeks after the NFL was rocked by leaked emails showing now-former Las Vegas Raiders Head Coach Jon Gruden using racist, sexist and homophobic language. He resigned soon after the emails came to light. We can't forget, though, that those emails come from a much broader investigation of the toxic work environment in the offices of the Washington Football Team. NFL Commissioner Roger Goodell said this week the league wouldn't publicly release anything from its investigation of the team, but lawyers for many of the women interviewed in the case say they want a public report.
And last January, just one month after hiring him, the New York Mets had to fire then-General manager Jared Porter, who admitted to sending explicit, unsolicited texts and images to a female reporter in 2016 when he worked for the Chicago Cubs. ESPN had been in possession of the texts since 2017, but the woman in question asked the network not to run the story out of fear her career would be harmed. She only reached back out to ESPN after she left the field of journalism altogether. Porter has been banned from the sport through next season.
If you believe in the phrase "where there's smoke, there's fire," professional sports is a five-alarm blaze.
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Curaleaf CEO Joe Bayern joined Cheddar's "Closing Bell" to discuss the cannabis company's Q3 earnings report, which came in under expectations and included widening losses. Bayern discussed taking a hit on profitability based on the slower-than-expected expansion in some Northeast markets. While the company reduced its fiscal guidance for 2021 due to a general slowing of the cannabis market, he did note that he still sees much room for growth in 2022 and beyond.
Online consignment and thrift shop thredUP reported a Q3 earnings beat on Monday, and CEO James Reinhart joined Cheddar to discuss exceeding expectations and the state of the business overall. Reinhart said the company is thriving while other businesses may face supply chain issues due to the convenience of its system of acquiring secondhand clothing. "In a world where most consumers are feeling squeezed by prices and seeing apparel shortages, everything we have on thredUP is 100 percent in stock and ready to ship," he said. "And so I think it speaks to real opportunity for resale and a company like thredUP during the holiday season and into 2022."
Former NBA star, commentator, and entrepreneur Baron Davis and Deluxe Corporation Chief Brand Officer Amanda Brinkman, joined Cheddar to discuss Season 6 of the reality show "Small Business Revolution," premiering Tuesday. The season will focus on helping six Black-owned businesses in the Twin Cities, Minneapolis and St. Paul. Davis noted learning about the lack of resources, connections, and opportunities for Black business owners during the show. "There are so many things we need to do as a society to address racial injustice and inequity, however, one of the ways for it is economic empowerment," Brinkman added.
Katia Beauchamp, strategic advisor for FemTec Health and former Birchbox CEO, joined Cheddar to discuss the health and beauty sciences company's recent acquisition of subscription beauty supply provider Birchbox. She noted that FemTec wants to change the perception of the brand to include health as well as beauty. "This is something where we are reimagining how can we help consumers discover beauty products that really help them take great care of themselves, have beautiful underlying health that is shown on the exterior too," she added.
Cryptocurrencies are getting off to a good week. Ethereum surged more than 4% in 24 hours on Monday, hitting a new all-time high above $4,700. Meanwhile, Bitcoin surged 7% to a price of $66,250. Haohan Xu, founder and CEO of Apifiny, joins Cheddar News with thoughts on the growing sector.
