Zenrez, which offers yield management software tools for fitness studios, has raised $6 million in its series A funding. Artis Ventures led the round, along with other existing investors Summit Action Fund, Precursor Ventures, Nucleus Adventure Capital, C2 Ventures and Transmedia Capital. The company has raised a total of $10 million. This round of financing will be used to fund Zenrez’s continued expansion into major cities across the country and to leverage its evolving pricing technology to expand into other fitness and wellness services beyond classes.
In a 2016/17 report, the International Health, Racquet & Sportsclub Association, says 2,300 new facilities, mostly studios, opened in 2015. And from 2012 to 2015, consumer-reported membership in traditional fitness clubs grew by 5 percent, while in studios it grew by more than 70 percent.
“Fitness classes are the preferred method of how millennials choose to workout and boutique studios offer the highest quality experience,” said Matthew Capizzi, co-founder & CEO of Zenrez. “Boutique studios have moved away from the old big-box gym subscription breakage model, and instead, have opted for a more consumer-friendly but also more complex model in the form of pay-as-you-go packs. Therefore, they need a much more sophisticated solution to effectively manage their business, and that’s what we’ve built with Zenrez.”
Capizzi continued, “There’s much more revenue potential in the pay-as-you-go model, the challenge becomes maximizing utilization because you only get paid when people workout. This means creating a consistently great product so your customers want to come back as well as offering flexible pricing options to ensure you’re hitting all fitness-goer segments. Zenrez addresses the latter which helps unlock latent demand and drive additional bookings which can result in 10% or more of incremental monthly revenue for studios.”
Bookings through the platform have grown 400 percent year over year, and as of this month, Zenrez is fueling a workout every two minutes. The company currently works with 500 studios in cities including San Francisco, Los Angeles, New York, Boston, Pittsburgh and Seattle. By the end of this year, Zenrez plans to work with over 2000 studios in major cities all across the United States.
“Zenrez is an essential business tool for those in the health & wellness space, an industry that commonly struggles with yield management. In this business it’s especially critical to maximize price points and conversions, and Zenrez is proven to have a dramatic impact on revenue,” said Stuart Peterson, founder & partner at ARTIS Ventures. “We also love the potential for future applications – personal training, massages, salons – basically any service with perishable inventory would see similar benefit.”
Zenrez provides a yield management pricing technology and suite of software tools to help fitness studios increase the effectiveness of their acquisition and retention efforts. In addition, Zenrez’s marketplace serves as a discovery platform where consumers can access exclusive offers, search for studios and class classes, and check out reviews.
