Editor’s Note: This is a repost of a TechCrunch article by Christine Magee.
Fitness tech startups are off to the races in the second half of 2014, as venture investors seek to revolutionize the way we work out.
Seed fundings for fitness tech startups have been rising and later stage rounds have boosted the aggregate amount raised in the past year to over $200 million – half of which was committed last quarter alone.
Fitbit, Basis Science, and Misfit Wearables – all wearable activity trackers – lead the way for total venture dollars raised in the past four years. Despite the dominance of these major players in the wearable fitness tracking space, the market is quickly expanding.
According to a recent PWC study, 1 in 5 Americans own at least one wearable device, and 1 in 10 use it daily. This is on par with tablet use in 2012, which has jumped to over 40% in the past two years. Jawbone just launched it’s latest and cheapest activity tracker, the UP Move, last week to tackle the entry-level wearable market.
And consumer use of wearable fitness tech is just the tip of the iceberg.
One Million Metrics, a participant in the current R/GA Connected Devices class, is among a handful of startups offering wearable tech for the workplace. Currently closing a deal with a large package delivery company, 1MM provides wearable devices to track the movement and posture of material handling workers.
Wearable fitness tech in the workplace provides employers with the ability to reduce the risk of injury, accurately track performance, and gamify athletic activities, such as lifting boxes, to incentivize workers.
The majority of recent venture funding for non-wearable fitness tech has gone toward consumer fitness tracking platforms like MyFitnessPal or Strava. But gym tech giant Netpulse, which has remained relatively undercover despite raising nearly $40 million in venture funding, joined the race last quarter as it raised another $19 million to tackle a less sexy side of consumer fitness.
Netpulse provides the software that powers cardio machines and is currently working with 8 out of 9 major gym equipment manufacturers. Aside from incorporating all entertainment, workout stats, and communication with other fitness trackers into a single screen, Netpulse provides the CRM system through which gyms can communicate with their members.
“Netpulse has won the war and is now fighting all the battles in relation to fitness tech inside of gyms – which is half of all minutes spent on workouts,” says Jed Katz of Netpulse investor Javelin Venture Partners. “I’m very confident that you’re about to see a digital transformation of the $76B commercial fitness industry.”
Netpulse may have a monopoly on gym workout equipment, but startups like gym membership program ClassPass, neighborhood fitness community fitmob, and incentive-based gym workout tracker Pact Fitness have cropped up with new methods of incentivizing users to work out.
“I think you need more than just tracking your steps every day – at the end of the day that data gets boring,” says Katz, who has also personally invested in New York-based indoor cycling startup Peloton Interactive, “you need more interactivity.”
“Wearables funding is seeing 50% year over year growth, but there seems to be a general shift in being more than just a fitness wearable or health tracking app,” says Halle Tecco, founder and CEO of digital health seed fund Rock Health. Tecco launched Rock Health, now one of the most active early-stage players in the fitness tech space, after working in Apple’s healthcare and medical app segment and realizing how unsophisticated these apps were compared to those in the gaming segment.
Tecco says she’s still looking for niches that haven’t been covered yet, referring to startups like PumpUp, a social network for active living geared toward women, and Kitman Labs, a sports science company building injury prevention technology for athletes.
Image via Flickr user tableatny.
