 "Representative image")
Integrated fitness start-up Cure.Fit was implementing a reorganisation plan that would see its business verticals hived off as separate companies led by different chief executives, sources in know of internal discussions told Business Standard.
Cure.Fit’s virtual training sessions, which saw traction as gyms were closed during the pandemic, might soon be housed under a separate entity under Ankit Gupta, Cure.Fit’s technology head. “The virtual business is being split from the physical gym business to unlock value,” a source said.
“Cure.Fit has become three different businesses. One is into offline gyms, which got hit badly during Covid-19. The second is ‘eat’ business, which is operationally heavy. The third, virtual workout, is coming up as a media entity,” said this source. “Each of these businesses requires a different DNA.”
The food delivery unit, Eat.Fit, was hived off in October 2020 under a new entity called Curefoods Pvt Ltd. Co-founder Ankit Nagori took helm of the foods division after he swapped his 7.63 per cent shareholding in Cure.Fit, the main company, for an undefined majority shareholding in Curefoods at the time. Latest filings show Nagori owns 0.3 per cent in Curefit Healthcare, the parent of Cure.Fit.
Having separate firms will allow heads to focus on one service line, as well as allow Cure.Fit to raise funds independently for each unit, sources said, explaining the rationale. Ola implemented a similar strategy with its electric vehicle unit Ola Electric, which went on to raise large sums from Softbank and Matrix Partners and touched a billion dollar in valuation.
Approached for a response, Cure.Fit declined to comment on the development.
Once the main focus of the company, the gym business, popularly called Cult centres, is being scaled down. The latest number of Cult centres in operation could not be ascertained but it is estimated to be two-thirds of the 180 the firm claimed to have in February 2020.
Most of the cut-back happened in Tier-II cities. Up-market localities that had multiple Cult centres, now have only one. Gyms in India were closed from March to August 2020 under central government orders. During this time, Cure.Fit let go or furloughed 800-1,000 employees, mostly trainers and instructors.
On the other hand, virtual workout sessions boomed. About 250,000 people tune into at least one session daily on the Cure.Fit platform, Cult Live, according to the company. Virtual sessions, launched free of charge in March and made ‘chargeable’ in May 2020, are offered under subscription for three-, six- and 12-month packages. Recently, Cult expanded the offering to include personal one-on-one sessions online.
Despite the stress in the business, Cure.Fit remains a hot investor property. In March 2020, it raised Rs 690 crore in a funding round led by Singapore sovereign fund Temasek at a valuation of Rs 5,490 crore ($732 million). Since starting out in 2016, the Bengaluru-headquartered firm has racked up Rs 2,436 crore, according to data from Tracxn. Accel is its biggest shareholder, with about 20 per cent stake, followed by Kalaari Capital at (12 per cent).
Cure.Fit is also on an acquisition spree. This month it acquired US-based fitness wearable start-up Onyx and Indian all-access gym app Fitternity.
