In the latest reported sign that boutique fitness studios are struggling to keep pace with home exercise offerings, Flywheel Sports Inc. is shuttering over a quarter of its locations. The New York-based company said it will close a dozen of its 42 stores, Bloomberg reported.
In addition to all four Los Angeles studios, the company will also close those in Alpharetta, Atlanta; Austin, Texas; North Miami, Florida; and the Sunnyvale and Walnut Creek studios in the San Francisco Bay area. According to a Flywheel spokesman, “We decided to take a look at our national footprint and close studios that were under-performing. All riders impacted will be offered a full refund.” The company told instructors about the coming closures this week, while emails were sent to riders on Thursday (Aug. 15).
Flywheel was started by a SoulCycle founder roughly 10 years ago. The company has since grown to major U.S. cities and then came into “financial trouble,” per the outlet. In April, control of the company was reportedly seized by its lender, which had reportedly been looking for a buyer.
The report also noted that Peloton has grown to have over 500,000 subscribers for its exercise products and fitness apps. The most popular offering is its stationary bike, which comes with a built-in tablet that displays live instructional videos.
In separate news, reports surfaced in February that Peloton is talking with banks about an initial public offering (IPO) as it heads toward potentially becoming a public company. At the time, it was reported that the company was seeking a debut in the latter half of the year. In June, the company said it had confidentially submitted paperwork to regulators in the U.S. for an IPO. It is seeking a valuation of $8 to $10 billion, per unnamed sources cited by the Bloomberg report. That figure would be approximately double the size of its last private funding.