Bengaluru: Health and fitness startup CureFit has set an ambitious aim of a tenfold surge in annual revenue to $1 billion by 2022, buoyed by a deeper expansion in India as well as overseas and the launch of new products.
The company, which attained $100 million a year in annual revenue within three years of starting operations, plans to make an initial public offering after it achieves the revenue milestone.
“We are very confident that we would be able to grow 10x by 2020. In this journey, by the time we hit $1 billion revenue, we will be definitely profitable. Our unit economics is very solid; our contribution margin across all categories is over 30%. In terms of the long term exit scenario, it is to go public. Whether we go public in India or outside, is a strategic question," Mukesh Bansal, co-founder and chief executive, CureFit said in an interview.
The Bengaluru-based firm has a distinctive business model of offering food (through its eat.fit brand), physical fitness (cult.fit), mental wellness (mind.fit), primary care (care.fit), and fitness clothing (Cult Sport) on one platform (an app). CureFit has created a tech platform to help customers manage their everyday health regimes including food, which is backed by an offline, proprietary fulfilment network to service them.
While fitness centre chains such as Planet Fitness and Talwalkars Better Value Fitness have gone public, CureFit is the first to provide these five interconnected offerings on one platform. Hence, cross selling of products has happened easily, helping grow its revenue.
The company aims to have a total of 100 million customers in the next three years on the back of its global expansion and introduction of several new products.
“In India, we think we will be able to acquire 5-10 million customers who will pay for our service in the next three years. We will also have 10-15 million customers who will be using our digital services, where people can work out at home, get consultations and advice at home," said Ankit Nagori, co-founder, CureFit.
“Twenty percent customers will go to centres and 80% customers will actually use the service digitally. They will all be paying for it. We think we have a chance of building India’s largest digital subscription product," Nagori said.
CureFit has lined up expansion plans to fuel its growth. Cult.fit, the company’s largest business vertical currently, has 200 studios across seven India cities. It recently forayed into the United Arab Emirates with the launch of the first cult.fit studio in Dubai. It currently has 40 eat.fit kitchens, five care.fit and 31 mind.fit centres.
By 2020, the three-year-old startup aims to expand cult.fit, eat.fit and mind.fit across 800 centres in 50 Indian cities. Internationally, it plans to launch 10 more cult.fit centres and one mind.fit centre by the end of this year in Dubai.
The company has identified four regions for global expansion—South-East Asia, Middle-East, Europe and North America. It will enter South-East Asia by the end of 2020.
“Right now, a typical customer is paying us about ₹25,000 a year now, that’s about $350. We believe that if things go well, we can extend that to $1,000. So, if I take a 20-year view, this is how we will create a $20 billion business," said Nagori.
In the meantime, the company is also expanding its array of offerings. Currently, it is incubating a packaged health food business plan and will launch a range of energy and quinoa bars and smoothies under the whole.fit brand in three to six months. It will be entering the wellness space and is set to introduce skin, hair and dental care services and products by the end of this year. It will also launch a range of its own shoes and wearables such as watches and heart rate monitor bands.
CureFit, which counts Chiratae Ventures, Accel Partners, Kalaari Capital, and Oaktree Capital among its investors, has so far raised $300 million in multiple rounds of debt and equity funding.
Anil Joshi, managing partner at Unicorn India Ventures, a venture capital firm, said CureFit’s business model is a sound mix of healthcare, retail and technology, hence it is likely to grow even bigger than $1 billion revenue target in years to come.
“Revenue realizations tend to be higher in overseas markets. It’s an innovative company, so it will keep introducting new products and services that will keep its customers hooked," Joshi said. “We have seen how they launched a sports apparel line recently. Their execution capability is very strong. Healthcare and wellness is a very big opportunity in India and overseas."
Bansal, on his part, insists that CureFit is a “personalized health manager". “The job of the app is track your health on a daily basis. Using this data we can create personalized heath programmes for people. Our long-term ambition is to create health insurance, we call it active insurance, which means we are monitoring you every day and working with you to make sure you remain healthy ," said Bansal.
