<iframe src="https://www.googletagmanager.com/ns.html?id=GTM-P36XLWQ" height="0" width="0" style="display:none;visibility:hidden">

Tonal seeks buyer or fresh investment at US$500m valuation

Weight training connected fitness platform claimed to be worth US$1.9bn last year.

14 February 2023 Steve McCaskill


  • Tonal targets additional funding to continue growth
  • Athlete investors include Serena Williams and LeBron James

Tonal, the smart home gym tech startup backed by an array of leading athletes, is reportedly seeking fresh investment or a potential buyer at a valuation of US$500 million – only slightly more than a quarter of what it was said to be worth last year.

The company, which manufactures high-end weight training equipment and operates a subscription-based workout and membership programme, was one of several connected fitness firms to experience rapid growth during the pandemic.

In March 2021, Tonal raised US$250 million in a funding round that valued it at US$1.6 billion, and was exploring the possibility of going public. As late as September 2022, it was seeking an additional US$110 million at a valuation of US$1.9 billion.

However, like Peloton and others, Tonal has struggled to adapt to a market contraction in a post-lockdown world, as well as wider macroeconomic challenges and supply chain disruption.

The Information reports the company has already cut jobs, closed studios and shuttered physical stores, but is still spending vast amounts of cash, prompting the decision to examine alternative strategies. Tonal is also said to be looking at replacing its chief executive Aly Orady.

Athlete investors include tennis legend Serena Williams, the National Basketball Association’s (NBA) all-time leading scorer LeBron James, and former heavyweight boxing champion Mike Tyson.

Tonal has been contacted by SportsPro for comment.

SportsPro says…

The connected fitness market is far from dead – it’s just entering a new phase.

Short-term demand created by the pandemic had led to a flood of enthusiasm but not the foundations for long-term growth. High-end connected fitness equipment is very expensive and takes up a lot of physical space, which means it was never likely to become a mass market proposition.

Peloton, the leading light in the space, has undergone a painful restructuring with a focus on subscriptions rather than hardware sales in a bid to broaden its appeal. The signs are that a turnaround could be on the cards after narrowing its losses. The concept of connected fitness technology is a popular one, despite the struggles of the market leaders.

However, Tonal’s reliance on high cost, proprietary hardware could make a similar recovery a challenge. A partnership with another major player in the space would appear to be the logical next step, with Tonal’s technology and platform used as a way to deepen an established connected fitness ecosystem. A potential sale to Peloton was ultimately abandoned last year due to Peloton’s own well-documented struggles.

The immediate challenge is to secure funding that will allow Tonal to survive, expand and ultimately create a more viable business model – even if the days of astronomical valuations are over.

1 / 2news articles read

Enjoying SportsPro content? Create your account and get enhanced access to all the latest stories.


Already have an account?