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Online fitness platform Zwift has raised $450 million in a fundraise led by global investment firm KKR.
Zwift, based in California, said the money would pay for upgrades to its software, which allows people to compete against others online while running on a treadmill or cycling on an exercise bike.
It will also make its own hardware, it said, but did not detail its plans. Bloomberg reported the hardware would include a Zwift bike.
KKR was joined by new investors including Permira and the Amazon Alexa Fund, and existing investors such as True, Supercell, and Highland Europe.
Two people familiar with the matter told Bloomberg that the investment values the company at more than $1 billion.
Ilkka Paananen, who founded Finnish video game company Supercell, will also become both an investor and independent board member, Zwift said.
KKR invested through its Next Generation Technology Growth Fund II, which is for technology-based growth equity firms. It has invested more than $2.7 billion in these kind of companies since 2014.
Zwift popularity booms during lockdown
On Zwift, users wirelessly connect their bikes or treadmills to an app to power virtual avatars around 240 miles of 3D terrain. Zwift partners with fitness app Strava so users can log their exercise and compare their times with friends.
It costs $14.99 a month. The company also sells products to connect bikes to the app, clothing, and its RunPod, a device you attach to your treadmill to track workouts.
Since its 2015 launch, more than 2.5 million people have signed up, including Facebook boss Mark Zuckerberg — and it has boomed during lockdown. The Long Beach-based startup has hosted professional events, including the first Virtual Tour de France in July, and it will also host the inaugural UCI Cycling Esports World Championships in December.
Stephen Shanley, director at KKR, described Zwift as the “preeminent” digital brand for cyclists. He said that KKR sees “tremendous potential ahead as Zwift invests further in its digital and physical products to enhance the experience for its global community of enthusiastic users.”
SEE ALSO: Apple launches Fitness Plus service to take on Peloton
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Source:: Business Insider