SoftBank Leads $300 Million Investment in Brazil’s Gympass

SoftBank Group Corp. is leading a $300 million investment in a Brazilian startup that makes gym workouts more accessible for corporate employees.

Gympass, founded in 2012, provides monthly passes to more than 2,000 companies so they can help pay for fitness programs for workers. It has a network of about 47,000 gyms that offer activities ranging from yoga and ballet to high-intensity training and martial arts.

The company started in Brazil and moved its headquarters to New York in 2018. It plans to use the new money to expand into Asia, while growing in the 14 countries where it already operates, Chief Executive Officer Cesar Carvalho said.

The SoftBank money is coming from its $100 billion Vision Fund, and a $5 billion Latin American Fund. The Japanese giant has backed some of the world’s biggest tech companies, including China e-commerce leader Alibaba Group Holding Ltd. and ride-hailing company Uber Technologies Inc.

SoftBank’s Latin America Fund Investment Partner Shu Nyatta said the company often aims to turn promising startups into global companies. “In Gympass’s case, they’ve created something very compelling and really know how to execute it, so there’s no reason for them not to become a global company,” Nyatta said.

Billion-Dollar Valuation

Gympass’s current investors, which include General Atlantic, Atomico and Valor Capital, will also put more money into the business. SoftBank declined to say how much of the $300 million it’s contributing. Including the fresh money, Gympass will be valued at more than $1 billion, Carvalho said.

“We intend to continue supporting Gympass as they expand throughout the world,” Valor Capital partner Scott Sobel said in an email.

“The market opportunity remains huge, and now we have the capital to scale even further,” Hiro Tamura, an Atomico partner and a board member of Gympass, said in an email.

This is the second large check SoftBank has written in Brazil recently. It invested in logistics startup Loggi earlier this month.

“We really want to create Fortune 50 companies from Latin America,” Nyatta said. “There’s been a lack of capital to help entrepreneurs in the region think bigger, and that’s why we’re here.”

Couch Culture

Gympass will focus mainly on expanding in the U.S. by showing corporate customers the benefits they can provide to their workforce, Carvalho, 35, said. The main challenge facing the Alfenas, Minas Gerais-native is to get people off the couch.

“We need to help them figure out which kind of physical activity they love,” Carvalho said. He’s trying all the New York gyms that Gympass works with. He’s hooked on yoga now. Tennis, his favorite sport back in Brazil, is too expensive in Manhattan.

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