Obe Nabs Backing from Samsung Next, Athleta in Home-Fitness Bet
(Bloomberg) -- Obe Fitness, a digital-workout platform, nabbed backing from investors including Samsung Electronics Co.’s Samsung Next, Gap Inc.’s Athleta and actress-comedian Tiffany Haddish in a bet on the continued popularity of streaming workouts in the wake of the pandemic.
The $15 million fundraising round values the startup at about $190 million, according to people with knowledge of the matter. Other participating investors include WW International Inc., Cavu Venture Partners, Wheelhouse Entertainment, Harris Blitzer Sports Entertainment and Aarti Kapoor, a former Goldman Sachs Group Inc. and Moelis & Co. banker, Obe co-founders and co-Chief Executive Officers Mark Mullett and Ashley Mills said.
The connected-fitness sector has garnered increased support from institutional investors, in part due to the belief that much of the population will retain some lockdown-era workout habits due to convenience. Obe doesn’t believe at-home fitness will drop in popularity as the world reopens following the Covid-19 pandemic, Mullett said in an interview.
“We’re excited about the direction ahead of us and continuing to make fitness a part of peoples’ lives everywhere,” he said. “Obe can go wherever people are going.”
The startup launched classes for when members are traveling, encouraging them to make use of items such as carry-on suitcases, as well as an office series that incorporates desks, chairs and other furniture. Mills said she believes many Obe users -- who take an average of 14 classes per month -- will adopt a hybrid model, using the $27-a-month platform while also making visits to boutique fitness studios or gyms.
Obe is an acronym for “our body electric,” a phrase inspired by a Walt Whitman poem. Mullett and Mills, former CAA talent agents, say their priority is ensuring members -- including celebrities such as Kate Hudson and Drew Barrymore -- are entertained while working out. It has partnered with HBO Max, Disney+ and Peacock, among others, to offer themed classes linked to programs such as “Sex and the City,” “Game of Thrones” and “Girls5eva.”
Unlike Peloton Interactive Inc., which held in-person classes before the pandemic, Obe decided against allowing member participation when filming content.
“We wanted to have instructors playing directly to them as opposed to playing to the room,” Mullett said. Still, Obe has hosted events including a New York retreat in March 2020, when members flew in from more than three dozen cities, to facilitate community building.
Obe’s co-CEOs said the startup intends to spend its funding on hiring, driving subscriber growth and potentially adding classes beyond its core offerings of cardio, strength and yoga supplemented with stretching and meditation. Based on member feedback, Obe may introduce workouts with heavier pieces of equipment such as weight plates or kettlebells as well as cycling content, Mills said.
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