Mindbody ClassPass eyes IPO with Goldman Sachs as the lead banker

ClassPass, the subscription-based fitness platform acquired by Mindbody in 2021, is setting its sights on an IPO within the next 12-18 months, with Goldman Sachs tapped as its lead banker, Reuters reported, citing the company CEO.

Mindbody, based in California, went public in 2015 but was bought by Vista Equity Partners for $1.9 billion in 2019. Now, with its acquisition of ClassPass, Mindbody is gearing up for a return to the public markets.

The combined company, valued at around $3 billion post-acquisition, expects to hit $500 million in revenue for 2024, with a projected 20% growth, CEO Fritz Lanman said. The company’s AI-driven app, which facilitates bookings for salons and spas, has helped ClassPass grow to 65% larger than before the pandemic, Reuters reported.

In its last funding round in 2021, ClassPass secured $500 million from a convertible debt investment led by Sixth Street. With Mindbody ClassPass planning to use the IPO funds for shareholder liquidity and potential acquisitions, Vista Equity remains the largest shareholder, alongside venture capitalists like L Catterton, Temasek, and General Catalyst.

Lanman emphasized that the company’s dual business model and profitability set it up well for a public offering. The strong post-pandemic recovery, especially in demand for yoga and fitness sessions, combined with advanced AI solutions for bookings, highlights the company’s growth potential.

“We are a story of two different businesses under one umbrella, both of which are growing, both of which are profitable, setting us up for an eventual IPO,” CEO Fritz Lanman said. “We have Goldman … but we haven’t chosen the second and third leads yet,” he added.

The company has experienced a significant rebound since the pandemic, with rising demand for yoga and in-person workouts. ClassPass is also utilizing AI to streamline salon and spa bookings.

Lanman noted that the IPO proceeds will focus on enhancing shareholder liquidity and exploring M&A opportunities, as the company continues to track IPO performance trends closely.

We covered ClassPass in 2020 when the health tech startup raised $285M Series E funding to fuel global expansion and scale corporate wellness programs. Before its acquisition, ClassPass had thousands of members with instant access to over 30,000 pre-vetted global exercise studios, which offer diverse fitness options including yoga, cycling, Pilates, strength training, boxing, and more.