10.0% - 17.3%
min - max equity offered
NZ$419,995.00 - NZ$787,510.00
min - max investment sought
min investment parcel
> Offer Type: Australian Retail (CSF) Offer This offer is open to Retail and Wholesale/Sophisticated investors in Australia. Whilst in New Zealand the offer is open to Wholesale investors.
> Company: FitClassNow Pty Ltd Securities purchased are for direct equity in FitClassNow Pty Ltd.
> Security Type: Ordinary Shares
> Fees Paid by Issuer: 5% of funds raised Upon successful completion of this funding round a total of 5% of capital raised will be paid by the Issuer to Equitise.
> Cooling-Off Rights: 5 working days - Retail investors in Australia are able to withdraw their applications for securities with accordance to the Australian Crowd Source Funding (CSF) regulations. For more information please click on the link supplied.
> Related Parties: None
ESIC Tax Incentive
AirActive (The Company) believe they pass the 100 point ESIC assessment the following way:
- 50 points – between 15% & 50 % of the company’s total expenses for the previous year were eligible for the R&D Tax Incentive
- 50 points – One or more 3rd parties have previously paid a total of at least $50,000 for the issue of new shares in the company
Equitise does not validate or hold any responsibility for these statements. ESIC is a tax offset for Australian Tax Payers - please find more information on the ATO Website (http://bit.ly/2oAKhbc) and seek advice.
More detailed information about this offer is contained in this Offer DocumentOffer Document
FitClassNow Pty Ltd ("AirActive") is seeking between A$400,000 and A$750,000 investment against a pre-money valuation of $3.59M and $6.07/share (at the December 2016 milestone). This will equate to:
- 10.3% of equity and 65,874 shares for a raise of A$400k or
- 17.29% and 123,515 shares for a raise of A$750k
*Please note 73,355 shares are scheduled to be converted at the conclusion of this raise. These are shares are part of an Incentive Share Pool detailed in full in the Cap table in the Documents section of the offer. The figures above represent the company’s fully diluted position post-raise
The purpose of the investment is to help AirActive move into Stage 3, understanding significant demand generation partnerships (Virgin/Velocity and Bupa) have been signed at national level. The timelines indicated in the diagram below are estimates and are subject to change.
NB: Richard Peil (Co-founder AnytimeFitness) and Bill Moore (CEO Fitness Australia) are 2 seed investors.
AirActive is a two sided digital market place that offers a booking platform for the active lifestyle, from fitness to wellness, recreation and sports. This is a response to the convenience, mobility and holistic needs of the Millennials.
Made scalable and global from inception, the company has already:
- Developed the technology with a provider scheduler and user mobile apps
- Onboarded most of the large Australian fitness providers (FitnessFirst, Genesis, Goodlife, YMCA, Fernwood) with the support of the peak bodies
- Partnered with the Melbourne Business School (MBS) for the first yield management software in the industry (the IP remaining with AirActive)
- Negotiated demand generation partnerships with Virgin/Velocity and Bupa
- Created a Corporate Wellness Programme targeting HR Departments as a conduit to expose AirActive to the employees.
The investment will help accelerate consumer adoption with the activation of the demand partners (Velocity, Bupa and others to come), the Corporate Health Program and direct marketing activities. At the same time, it will help expand the stock (beyond fitness) to wellness (massages, saunas, spas etc.), recreation (swimming pool, trampolining, paddle boarding etc.,) and sports (tennis, golf etc.).
Targeting a market more than 15 million casual visits per year, AirActive is looking at growing the volume of bookings from 1,200 in February 2017 to 60,000 in June 2018, taking less than 5% of the target market and becoming cash positive by around that time.
Below are the key statistics that underpin the strategy, with the initial targeting of the fitness industry before expanding into wellness, recreation and sports. The AirActive messaging will focus on the Millennials and the Corporate Employees.
- Fitness casual entries, although not actively promoted by the clubs, amount for 3.5% of the industry or 2.450 million visits per year (IBIS 2015)
- One third of fitness club members want to shift to pay-per-use (MINTEL 2015)
- Millennials already account for 52% of the fitness club members and tend to belong to a club for half the duration of Baby Boomers (FITNESS AUSTRALIA 2015); they dominate all fitness class activities (NIELSEN 2014)
- Corporate Employees (more than 60% of them) would like to exercise more (BUPA UK 2015). Exercising is the number 1 behaviour individuals are trying to change
- Convenient location is the number one driver why people attend their current fitness facility (NIELSEN 2014)
AirActive generates revenue by collecting fees from user bookings and paying the provider after deducting a booking fee. This is model is protected on the supply side by the yield management software co-created with MBS.
It creates a win-win between the providers and the users:
- Activity providers stay in control of their pricing, stock and customer base. They optimise their revenue through the variable (peak/off-peak) pricing capability, further refined by the yield management software.
- Users are empowered with choice, rating and social networking capabilities. They can find and pay-as-they-go (no membership) any activity, anytime, anywhere.
Over the mid-term, AirActive will create new sources of revenue and become a Software as a Service (SaaS) business selling analytics to the health and lifestyle industry. Our ability to white label (through our API capability) will further extend the reach and increase the depth of the analytics.
The business model optimizes the cost of doing business and creates a disconnect between the revenue line and the cost line (achieving a +30% EBITDA business within 3 years):
- Partnerships with industry peak bodies facilitate the onboarding of providers
- Support from our Kuala Lumpur Global Support Centre reduces the operational costs
- Demand generation partnerships reduce the direct B2C user acquisition costs (through a B2B2C reach),
Beyond the scalability, AirActive is also set up to roll out in major markets around the world.
Structure between FitClassNow Pty Ltd and AirActive Australia Pty Ltd
AirActive Ltd is a subsidiary entity of which a 94% shareholding is owned by FitClassNow Pty Ltd. This offer available on the Equitise platform is an investment in the FitClassNow Pty Ltd entity. The shareholding in each of the two entities can be found in the Documents section of this offer.
For more information, please see Appendix 3 in the AirActive Information Memorandum. A Franchise Agreement, which governs the relationship between FitClassNow Pty Ltd and AirActive, can be found in the Documents section of this offer.
AirActive was co-founded by Emmanuel Goutallier, Jo Russel and Adrian Deluca in July 2015. Together, they have more than 75 year experience:
- Emmanuel is a seasoned business technologist and business development global leader (Deloitte, Accenture, HP, Hitachi); he drives the ecosystem around AirActive
- Jo is one of the pioneers of the Australian fitness industry and created the Re-creation clubs; she is the fitness industry expert of AirActive
- Adrian is visionary technology leader who holds a senior position at AWS across APAC; he is the technology strategy advisor for AirActive
Our plan is to develop a unique set of data analytics and algorithms to detect patterns and predict user preferences, hence benefiting both the providers and the users.
We will expand the richness of the Big Data by expanding short-term to more categories of active lifestyle (from fitness to wellness, recreation and sports) and mid-term to more audiences (fun runs and kid activities).
Through the aggregation of a historically fragmented active lifestyle industry, our stretch goal is to achieve 1 million bookings per month in Australia alone.
The initial traction will be created by focusing on 2 key user segments: the Millennials and the Corporate Employees.
The raised funds will be invested in marketing and technology activities with a 60/40 ratio:
- Support of the Demand Generation Partners (Velocity and Bupa)
- Activation of the Millennials user segment through social media advertising and media influencers
- Activation of the Corporate Employee user segment through the Corporate Wellness Program
- Additional features required for the Recreation and Sports categories (e.g. group booking and program booking)
- Website enablement for online booking with a “back order” capability from small provider Websites/Facebook accounts
- White labeling API integration
Please note that the shareholder loans will not be paid down using the proceeds of this raise.
Profit and Loss
AirActive aims at being cash positive from June 2018 and delivering a +30% EBITDA by FY20.
Your shares will be held on trust by a nominee company. This allows the company and the nominee directors to help manage communications between investors and AirActive, and AirActive will only have one name on its share register.
Should there be a shareholder vote, such as on the future sale of the company, change in constitution or other shareholder resolution, the nominee will pass any required resolution to you, the investor to vote on. The nominee will then collate these votes and pass them up to AirActive. Where the corporate action (for example a shareholder resolution) requires the nominee to vote shares held as a single bloc, the nominee may vote the shares in accordance with a majority view expressed by those investors giving timely instructions.
Upon any liquidity event, where your shares are sold as a result of a trade sale or IPO, any funds available to you as a shareholder will flow through the nominee’s trust account to you, the investor. In the event of an IPO, where your shares are not sold but become traded on a public stock exchange, you will hold your shares directly in the company rather than through the nominee company. That is, the nominee will not stand in your way from recognising the economic benefit of a liquidity event.
We are happy to answer any questions about the nominee via email to email@example.com.
The active lifestyle market includes fitness, wellness, recreation and sports. A common characteristic of these categories is their high level of fragmentation. AirActive started with the fitness category as this the least fragmented one, with 50% of the revenue coming from large brands. The onboarding of the major brands allowed AirActive to create a minimum viable stock, necessary for negotiating the demand generation partnerships and accelerating the onboarding of the smaller clubs/studios.
The table below gives an order of magnitude for the current casual visit volume within the market:
For the direct source of the information contained in the table above, please contact firstname.lastname@example.org.
AirActive is initially targeting the Millennials and the Corporate Employees across the active lifestyle market. As described earlier in the KEY STATISTICS section, these user segments see tremendous value in exercising and well-being.
Millennials user segment: Close to 5 million people in Australia
- Millennials see wellness as a daily, active pursuit, hence an aligned behavior with the holistic offering of AirActive
- More than 80% of Millennials invest nearly one-fourth of their disposable income in health products/services (Spring/Summer 2015 Cassandra Report: Body, Mind, Soul – 2015)
- Millennials love mobile apps, to the tune of a whopping 90 hours per month spent on smartphone apps alone (comScore – 2016)
Corporate Employees user segment: Close to 12 million people in Australia
- More than 85% employees believe they would be more productive at work if they were able to stick to positive lifestyle changes.
- Two in five (44%) would love their work to help them make positive changes to their lifestyle
- Three quarters of employees (73%) have chosen to change their lifestyle to feel more physically healthy, with nearly half (46%) changing to improve mental health. The top behaviours people are trying to change are exercising more (65%) and losing weight (61%). (BUPA – 2015)
We are finding two types of players that are competing for the same market:
- The Membership Aggregators (e.g. ClassPass, BodyPass) that are all derived from the ClassPass model;
- The Membership Application Platforms (e.g. MindBodyOnline, NetPulse) that create mobile apps to enable members to access their own club activity schedule.
This business model was created by ClassPass in 2013. Since then, it has shown several shortcomings:
- Large brands reluctance to onboard as they see competition with their existing membership customers
- Usage limitations on the user to avoid cost creep in (e.g. high number of visits) against a fixed revenue (e.g. monthly membership fee)
AirActive went for a very different business model (activity brokerage) as described below:
Club Application Platforms
A number of club/studio management software vendors have launched their own mobile app enabling real time booking of “pay-as-you-go” classes. However, this booking capability is limited to the clubs running the software. In recent months, we are seeing the emergence of third party “pay-as-you-go” solutions offering the MindBodyOnline stock. ZENREZ raised US$ 2m in July 2016 to “take on ClassPass” in the US (www.zenrez.com).
AirActive has taken a more complete route, as we have no constraint regarding the on-boarding of the providers and we are agnostic to the membership application platforms:
- Most large clubs do not have any activity booking system, meaning that AirActive could become the de facto booking platform
- Our API technology allows us to integrate to the mainstream club/studio management softwares (this is work in progress with MindBodyOnline).
AirActive has been built to scale and hopes to deliver an EBITDA margin in excess of 30% when operating at scale. Forecasting a A$6m revenue in FY20 based on 155,000 bookings per month average.
Possible exit strategies include:
- Exchange Listing - IPO - Similar companies have gone/are going to IPO in the food takeaway industry (JustEat in 2014, Delivery Hero possibly in 2017)
- Buyout – from press, sports industry or booking platforms (Fairfax buying BodyPass in 2015, UnderArmour buying MapMyRun in 2013, TripAdvisor buys LaFourchette in 2014)
- Buyout by a competitor – ClassPass raised US$80m in 18 months; MindBody bought FitnessMobileApps in 2015
For the direct source of the information contained above, please contact email@example.com.
AirActive Certificate of Incorporation
AirActive Certificate of IncorporationDownload
FitClassNow Pty Ltd Certificate of Incorporation
FitClassNow Pty Ltd Certificate of IncorporationDownload
Shareholders Register - FitClassNow Pty Ltd
Shareholders Register - FitClassNow Pty LtdDownload
Cap Table - Airactive and FitClassNow Pty LtdDownload
AirActive Investor Memorandum
AirActive Investor MemorandumDownload
FCN AAA "Franchise Agreeement"
FCN AAA "Franchise Agreeement"Download
No documents added in this section