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Cult.fit elevates Naresh Krishnaswamy as CEO, Mukesh Bansal becomes chairman

EntrackrEntrackr · 1y ago
Cult.fit elevates Naresh Krishnaswamy as CEO, Mukesh Bansal becomes chairman
Medial

Fitness tech company Cult.fit has elevated its co-founder Naresh Krishnaswamy as the chief executive officer. He will succeed co-founder and long-time CEO Mukesh Bansal, who now takes over the role of the company’s executive chairman. Krishnaswamy already took over the position of the CEO in October last year, according to his Linkedin profile. The company, however, did not announce it formally then. A Cult.fit spokesperson confirmed the development. Before moving to the top position, Krishnaswamy was the head of finance of Cult.fit for more than three years and also handled growth and business division of the firm for more than two-and-half years. Before Cult.fit, he was associated with e-commerce firm Myntra for nearly six years. Following Tata Digital’s first investment of $75 million in Cult.fit in June 2021, Bansal joined the former as president. Though, he continued to hold the top role at the Cult.fit. Cult.fit recently raised around $10.2 million in an extended Series F round led by existing backer Valecha Investments. As per startup data intelligence platform TheKredible, Bansal holds a 10.5% stake in the company. Entrackr exclusively reported the fundraise in February. In January, Cult.fit announced laying off around 150 employees. As per the company, the move was a part of a regular annual operating planning process. During Covid-19 pandemic, it had fired around 800 employees and permanently closed many of its fitness centres across the country. Cult.fit turned unicorn in November 2021 when Deepinder Goyal-led Zomato acquired a 6.4% stake in the company in a $100 million deal. In FY23, Cult.fit’s revenue from operations surged 3.2X to Rs 694 crore from Rs 216 crore in the previous fiscal year. While it managed to reduce losses by 20% to Rs 551 crore (excluding the exceptional items or non-cash expenses) in FY23 from Rs 688 crore in FY22. The company is yet to disclose its FY24 numbers.

Cult.fit’s income crosses Rs 1,000 Cr in FY24, losses remain flat

EntrackrEntrackr · 7m ago
Cult.fit’s income crosses Rs 1,000 Cr in FY24, losses remain flat
Medial

Fitness tech company Cult.fit underwent a key leadership change in FY24 after promoting co-founder Naresh Krishnaswamy to CEO. He succeeds co-founder Mukesh Bansal, who transitioned to the role of executive chairman. While the company achieved over 30% growth in scale under the new leadership, the losses remain unchanged in the last fiscal year. Cult.fit reported a 33.6% increase in its operating revenue of Rs 927 crore in FY24 compared to Rs 694 crore in FY23. Revenue from fitness subscriptions, including flagship services like Cultpass and Cult.fit centers and platform services, accounted for 72.3% of the total revenue which increased by 46.6% to 670 crore. The sportswear and fitness equipment segment, operated under Cultsport and other operating services, contributed Rs 257 crore. Cult.fit reported a 62% decline in other income to Rs 100.45 crore in FY24 from Rs 265.36 crore in FY23 due to a plunge in Miscellaneous income which the company has not disclosed. However, Cultfit's total income stood at Rs 1,027 crore in FY24. Cult.fit operates on a hybrid fitness model combining digital offerings through its app and physical fitness centers across 300 cities in India. It provides subscription-based fitness plans (Cultpass) that grant access to gyms, group classes, and virtual training. When it comes to expenditures, employee benefit expenses contributed Rs 324 crore, including Rs 236 crore in salaries, and Rs 57 crore in employee share-based payments. While the cost of materials for Cult.fit grew by 19.6% to Rs 396 crore in FY24. Its advertising cum promotional cost grew by 40.3% to Rs 188 crore in FY24 while legal costs saw a surge of 57% to Rs 124 crore. Information technology, traveling, and other overheads took the overall cost up by 4.7% to Rs 1,563 crore in FY24 from Rs 1,493 crore in FY23. In the end, Cult.fit reported a steady loss of Rs 535 crore in FY24, slightly up from Rs 534 crore in FY23, driven by a decent increase in scale coupled with a decline in other income. Its ROCE and EBITDA margins stood at -21.5% and -22.8% respectively. Cult.fit managed to improve its expense-to-earning ratio to Rs 1.69 in the previous fiscal. Its current assets stood at Rs 1,232 crore with a cash and bank balance of Rs 349 crore in FY24. In January, Cult.fit laid off around 150 employees, stating that the decision was part of its regular annual operating planning process. To date, Cult.fit has raised over $670 million from investors including Zomato, Tata Digital, Temasek, Kalaari Capital, and South Park Commons, among others. Cult.fit has eventually followed the playbook that many dread, spending till most of the competition has been wiped out, or can't keep up. Losses finally stabilising even as growth continues indicates that the firm is well set for the next stage of the process, namely, tweaking prices and offerings to improve margins further. The unbelievable legal costs are a mystery, and one hopes to get clarity on that at some stage, but we sincerely hope it's a one off. Bigger firms have been built on those sort of costs. The acquisition of Gold Gym's India business back in 2021, or even the RPM Fit and associated brands after that pretty much guaranteed losses well into 2025, but Cult.fit could flex its muscles as it had the money in the bank. Now, it will probably look at a solid year of performance that, while cleaning out a significant part of its cash hoard, takes it closer to profitability and bigger things. The sportswear and fitness equipment business however, will remain a worry, considering the even more muscled up player in the market, French multinational Decathlon.

Exclusive: Tata Digital-backed Cult.fit tops up Series F with $10 Mn funding

EntrackrEntrackr · 1y ago
Exclusive: Tata Digital-backed Cult.fit tops up Series F with $10 Mn funding
Medial

Health and wellness platform Cult.fit (formerly Cure.fit) has scooped Rs 84.5 crore or $10.2 million in an extended Series F round led by existing backer Valecha Investments. The funding comes after a gap of nearly two years for the Bengaluru-based company. The board at Cult.fit has passed special resolutions to issue 1,55,080 equity shares to Extreme Brands LLP and 15,92,157 Series C compulsory convertible preference shares (CCPS) to other investors at an issue price of Rs 483.62 per share to raise Rs 84.5 crore, as per the company’s regulatory filings with the Registrar of Companies. Valecha Investments spearheaded the round with Rs 36.36 crore followed by Gul Advani who invested Rs 28.26 crore. Extreme Brands LLP (Exceed Entertainment), L&K Wellness Services (Reset Life) and individuals namely Surendra Kedia, Sangeeta Mansharmani, Shraddha Sheth, Nikhil Kakkar, and Prashant Machwe joined the round with the remaining sum. The company also raised nearly Rs 300 crore in the last quarter of FY22 (Jan-Mar 2022) from Accel, IIFL, Valecha Investments, and other individuals, as per TheKredible. The fundraise, however, missed the headlines. Overall, Cult.fit has raised over $670 million to date from the likes of Zomato, Tata Digital, Temasek, Kalaari Capital and South Park Commons among others. As per startup intelligence platform TheKredible, Cult.fit has been valued at Rs 12,400 crore (post-money). Post-allotment of the round, Accel Partners stands as the largest stakeholder in the company with 17.25% shares whereas its founder & CEO Mukesh Bansal owns a 10.5% stake. For more information, visit here. Cult.fit turned unicorn in November 2021 when Deepinder Goyal-led Zomato acquired a 6.4% stake in the company in a $100 million deal. Last month, the Tata Digital-backed company laid off around 150 employees to improve productivity and achieve profitability by FY25. Cult.fit’s revenue from operations surged 3.2X to Rs 694 crore in FY23 from Rs 216 crore in FY22. While it managed to reduce losses by 20% to Rs 551 crore (excluding the exceptional items or non-cash expenses) in FY23 from Rs 688 crore in FY22.

Cult.fit picks bankers for Rs 2,500 Cr IPO

EntrackrEntrackr · 3m ago
Cult.fit picks bankers for Rs 2,500 Cr IPO
Medial

Fitness tech company Cult.fit has chosen banks to manage its upcoming IPO, according to a CNBC-TV18 report. The selected banks include Axis Capital, Jefferies, Goldman Sachs, Morgan Stanley, and JM Financial. As per the report, the company plans to raise Rs 2,500 crore (nearly $300 million) through the IPO, which would value it at nearly $2 billion. To date, Cult.fit has raised over $670 million from investors including Zomato, Tata Digital, Temasek, Kalaari Capital, and South Park Commons, among others. In November 2021, Zomato invested $100 million to acquire a 6.4% stake in Cult.fit, valuing it at $1.56 billion at the time. Founded by Myntra co-founder Mukesh Bansal and Ankit Nagori, Cult.fit operates over 500 gyms across multiple cities in India. Apart from gyms, the company also runs Eat.fit, a healthy meal delivery service that contributes 24.5% of its revenue. While Nagori has already left Cult.fit to lead its hived-off cloud kitchen vertical, Curefoods, Bansal took on the role of the company’s executive chairman last year. The company also elevated its co-founder Naresh Krishnaswamy to the position of chief executive officer. As per TheKredible, Cult.fit reported a 33.6% increase in its operating revenue to Rs 927 crore in FY24 compared to Rs 694 crore in FY23. It reported a steady loss of Rs 535 crore in FY24, slightly up from Rs 534 crore in FY23.

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