What to know about the 2021 Equinox IPO


Headquartered in New York City, luxury fitness company Equinox is hitting its stride coming out of the COVID-19 pandemic. It started as a single fitness club in the Upper West Side and is now an international company operating 100+ gyms all over the world including branching out into the hotel industry in 2019. It owns and operates the following luxury lifestyle and health-focused brands: Equinox, Equinox Hotels, Precision Run, Project by Equinox, Equinox Explore, Equinox Media, Furthermore, PURE Yoga, Blink Fitness and Soul Cycle. The programs offered include strength training, cardio training, group fitness classes, private personal training, pilates classes, pilates instructor training, spa services, apparel and accessories.

Each location and brand exemplify the corporate tag-line: High Performance Living. Equinox is in IPO-related negotiations that have not been finalized with SPAC-company Social Capital Hedosophia Holdings Corp. Potential valuations shared by knowledgeable insiders go up to $9 billion. 

TL;DR

  • Equinox was founded in 1991 by three siblings: Lavinia, Daniel & Vito Errico. 
  • Equinox started as a single, upscale, aesthetically pleasing fitness center where you could both work out and hang out.
  • Equinox is a private company that has had two equity fundraising rounds of undisclosed amount. 
  • Historical sales information is not publicly available. In 2020, citing the impact of the global pandemic, the company reported a $350 million loss despite bringing in $650 million in revenue. 
  • Settled a lawsuit in 2013 about unpaid overtime for their trainers. Is also involved in a lawsuit over unpaid rent in NY in 2020-2021. 
  • The current chairman and CEO is Harvey Spevak. 
  • In 2020 when they received an equity round of funding, they were valued at $7 billion. They are exploring an IPO with a valuation of up to $9 billion. 

You can learn more about IPOs here.

Equinox at a glance

Sibling co-founders Lavinia, Daniel & Vito Errico started the company in 1991 with a single fitness club in NYC. Lavinia Errico had a background in talent management. Daniel Errico’s past career had focused on money, investments and real estate. Vito Errico was a builder and interior designer. They wanted to create an alternative to “Happy Hour” after work for the professional New Yorker. Thus they created beautiful gyms in prime locations where clients both exercised and socialized. 

When Equinox first started, gyms were thought of as places where bodybuilders went. Aesthetics were not valued or incorporated – many large gyms just resembled a dingy, low-lit, low ceilinged basement with mats on the floor. The Errico siblings wanted to combine the clean, bright vibe of dance and aerobic studios with great music and ambiance so that people would want to go after work and hang out with friends. They bootstrapped the business’s start and it’s initial growth and didn’t have outside investors.

The Errico family experienced a lot of early success and recognition. Their clubs were cutting edge and the first to have features such as reiki, massage, dance cardio and indoor cycling incorporated all into one place. They invested in personal training by creating the Equinox Training Institute and Certification Program so that the personal training available in their clubs would be the best. Equinox was consistently voted the best fitness club in the city when they started. Since then, they have been voted best gym in America by Fitness Magazine. In 2020, they were the Interiors Awards Spa/Fitness winner. 

They credit their success to 12 core values: 

  • Diversity celebrated
  • Open, honest & considerate communication
  • 110% effort = extraordinary results
  • Challenge the status quo
  • Personal accountability
  • Fun and love every day
  • Supportive approach to common goals
  • Mutual respect
  • Success recognized
  • Personal growth and fulfillment for all
  • Empathy and responsiveness
  • Integrity with members, employees and partners

In 2000, Spevak led a management buyout of Equinox by two firms, North Castle Partners and J.W. Childs. Six years later, he partnered with the chairman of Related Company to obtain the controlling, majority interest of the company. It was at this point that the Errico siblings no longer maintained an ownership interest in the company. Equinox purchased Pure Yoga in 2008 and operates it as a separate entity. The company created a separate company called Blink which was focused on the value-driven membership model in 2011. Also in 2011, the company acquired SoulCycle. Spevak secured a significant minority investment from private equity firm L Catterton in 2017. In January 2018, Equinox invested in obtaining a minority stake in Rumble Boxing – a women-focused boxing, fitness brand. They provided $80 million in the Series D funding round of Industrious in April 2019. Industrious is a shared workspace company. In July 2019, Equinox launched Equinox Hotel. It is in Manhattan in Hudson Yards. 

While sales information is not available, the steady growth and expansion of the company from its start in 1991 to now demonstrates it has had the staying power in the past. While it did experience losses during the global recession caused by the COVID-19 pandemic, it’s name remains synonymous with a luxury fitness experience, surroundings and equipment. During the pandemic they allowed customers to freeze their accounts and had to furlough thousands of workers. 

Equinox operates in many markets at various levels with its brands. Equinox Fitness Club has 106 clubs covering large cities like Boston, Chicago, DC, London and NYC. They also have locations in Connecticut, Florida, Michigan, New York, New Jersey, California, Texas and Canada. Equinox Sports club operates six luxury clubs in NYC, LA, SFO, BOS, DC, & Orange County – at these people tend to spend 4-6 hours between working out, cooling down, winding down and socializing. The company operates two E by Equinox Clubs, where clients pursue results in an environment that is the ultimate in exclusivity – one in NYC and one in London. The company operates the Equinox Hotel in Manhattan, called the “fittest hotel on earth”. Precision run, the company’s new method-driven treadmill class boosts one NYC location where they are training clients in their luxury, oxygen-enriched indoor running studio. SoulCycle, boasting that it moves you from tired to inspired in one ride, is primarily located in the US but is in major cities and locations around the world. This includes DC, NYC, Westchester, Atlanta, Chicago, San Francisco, Vegas, London, and Long Island. They’re also in New England, the MidWest, Texas, the Pacific Northwest, Vancouver and Toronto. Blink, it’s value-driven, body-positive brand has locations in CA, FL, IL, MA, MI, NJ, NY, PA, TX and VA. It has grown via a franchise model. PURE Yoga, which started in Asia in 2002, was brought to the US by Equinox when it bought the company and opened a location in NYC. 

The company has also branched out from fitness clubs and centers. They run Project by Equinox which is their talent incubator. It’s NYC location can also be rented out for events. Another brand is Equinox Explore which hosts travel trips in interesting locales where you are physically active and the chosen activities (e.g. running, cycling) are led by trainers. Just as many other companies are accelerating their investments into virtual options, the company has a subsidiary called Equinox Media. Just as Equinox developed a high-end gym, they are involved in developing high-end digital media based products and services. “We’re really running a half fitness club, half production studio every single day,” Equinox Media CEO Jason LaRose said on a November 2019 episode of Making Marketing. Their fitness brands offer digital workouts and training. Another subsidiary of the company is furthermore from Equinox, a digital magazine positioned to be the “authority on the high performance life”. Readers enjoy articles and posts regarding workouts, recipes and lifestyle content.

Equinox’s mission is: “In everything we do, we create the possibility for people to maximize their potential within themselves.” In addition to being focused on providing the most luxurious and effective environment for their clients, the company also gives back to the community. Two examples are philanthropic projects that they participate in each year. They have partnered with Cycle for Survival since 2007, raising money for cutting-edge cancer research. Since 2014, they have run The Heroes Project which works to make “the impossible possible for injured war veterans”. It does this by providing the training they need to achieve their goals around climbing some of the most demanding peaks in the world.

Equinox Fundraising to know about

Equinox is a private company that has had two rounds of private equity funding. The first was from investor L Catterton in 2017 which gave them a minority equity stake in return for the undisclosed investment. In 2020 after they had an equity round of an undisclosed amount of funding from Silver Lake Partners that estimated the value of Equinox at $7 billion. 

Path to the Equinox IPO

Because Equinox is a private company and was in business for over 25 years prior to receiving equity funding, it is unknown when the company passed the $1 billion valuation mark. However, at its last funding round, its value was estimated at $7 billion. 

There have been no statements released from Equinox regarding the IPO or when an IPO first became a possibility. The company has spoken with many equity investors and SPAC-companies regarding the possibilities. SPAC is an acronym for Special Purpose Acquisition Company. They are colloquially known as blank-check companies for their seemingly endless amount of available funding. The potential IPO is backed by investor Chamath Palihapitiya and SPAC company Social Capital Hedosophia. Palihapitiya has prior experience with six other SPACs. Social Capital Hedosophia SPAC-mergers include forming Virgin Galactic Holdings, Opendoor Technologies and Clover Health Investments. The company is rumored to plan to position its stock as a “reopening stock” post-pandemic to help it differentiate itself from its competitors.

You can learn more about SPAC companies here. 

When is the Equinox IPO date? 

Equinox has not yet filed for an IPO and it remains confidential. Currently their majority investor is The Related Company – known for its real estate investments. Neither company has released any official statements. 

What investors should know about the Equinox IPO 

All investments involve risk; the important thing to do when considering an investment is to explore the types of risks that are specific to that particular company. One thing to delve into is if the company has any history of controversy or bad performance. In considering Equinox’s IPO, one must consider their past history. In 2013, the company settled two different lawsuits in California regarding unpaid overtime for trainers. This stemmed from complaints that the trainers were working such long hours that they had to sleep in their cars or in the locker rooms in between shifts. In February 2021, the company was sued over unpaid rent for NYC locations – undoubtedly linked to hemorrhaging finances due to the gyms being closed during the pandemic. The lawsuit alleges over $1million in unpaid rent is owed.

Equinox operates globally – though not all brands operate in every market. Many of the brands are run and operated as independent entities. On one hand, this ensures that branding remains true and undiluted. On the other hand, this introduces the risks and extra costs of functional redundancies. The entire fitness industry is still struggling to recover from forced closures tied to the COVID-19 pandemic. Competitor chains like Gold’s Gym International Inc., 24 Hour Fitness Worldwide Inc. and Town Sports Clubs all filed for bankruptcy protection in 2020. The company has plans to continue expanding its digital presence and offerings but faces stiff competition from all of its competitors who are doing the same both as a result of the global pandemic; but also because of trends related to connected fitness that are becoming the industry standard. It’s top remaining competitors are Planet Fitness, LA Fitness, Lifetime, Peloton, Anytime Fitness, Crunch, and Snap Fitness 24-7. Equinox will not be the first fitness-related company to become publicly-traded. Peloton, Nautilus, Lululemon, Planet Fitness, Town Sports Club and Under Armour are publicly traded companies. 

The fitness industry is expected to recover as a whole; however, maintaining expensive physical locations through the pandemic proved too costly for many companies. Innovations will come in the form of continued and expanded digital offerings and assurances around cleanliness for when people return to in-person training. 

Bottom line

Equinox is exploring whether to embark on an IPO. They will benefit from their concentration on a demographic that has extra disposable income and views the brand as part of their identity. Their investments into digital offerings will help continue to add greater value to the in person offerings if they can continue to be unique, cutting edge and effective workouts with up beat, expert trainers. The attractive aesthetic and vibe of their physical locations was their biggest asset in the past. If they can handle the end of quarantine restrictions well with strong re-openings, there may be potential for growth. 

Julie Pierce Onos is a Massachusetts-based writer and Organization Development expert. She loves the stories that numbers tell us about business, relationships and health. You can connect with her on Twitter at @juliepierceonos.

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