This week we're looking at why independent fitness clubs are becoming attractive acquisition targets.
Most independent operator clubs are trading around 5x to 6x club-level EBITDA once you add back ownership expenses, centralized accounting, operator costs, and regional development expenses, that can translate to roughly 7x EBITDA for the independent seller.
And the capital is there.
Strategic buyers have access to non-recourse debt, while private equity owners continue to favor acquisitions because buying an existing club gives them EBITDA immediately instead of waiting 12 to 24 months for a new location to ramp.
Even the franchisors are changing their approach.
Planet Fitness and Crunch are now encouraging rebrands of existing clubs, creating another path for independent operators to transact.
The technology side is improving too. Software conversions that once created major concerns around lost EFT are now happening in roughly three weeks, and sellers can receive credit for the embedded EBITDA created through those conversions.
The opportunity isn't just about selling a club.
It's about selling an existing cash-flowing asset that buyers can scale immediately.
Go HALO!
We go into much more detail in the HALO Academy. Registration is open now for our next cohort: https://www.thehaloacademy.com
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RESOURCES
https://www.integritysq.com
https://www.halotalks.com
https://www.thehaloacademy.com
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ABOUT YOUR INSTRUCTOR
Pete is the Founder, Managing Partner, and Chief Dream Architect at Integrity Square (""ISQ""), a leading boutique financial advisory firm focused on the $4.7T Health, Active Lifestyle, Outdoor (""HALO"") sector.
Since founding ISQ in 2010, the firm has played an active advisory role in 100+ mergers & acquisitions, private placements and advisory assignments across North America. Pete Moore and his team have also invested in passionate entrepreneurs at HigherDOSE, XTEND, and Promotion Vault.
ISQ's media and ""live education"" properties include HALO Talks, the leading B2B podcast in the sector, Time To Win Again, and the HALO Academy, an Executive Education Bootcamp Series.
Prior to ISQ, Pete was Head of the Active Lifestyle & Wellness Group at Sagent Advisors (2003-2010.) Prior to 2003, Pete was co-founder of FitnessInsite, a SasS sales management platform with 1500+ clients (based in AZ.) At FitnessInsite, Pete invested his personal capital, leveraged his credit cards and learned what it takes to manage a startup.
Pete built his business and financial acumen on top of the foundation laid at three critical positions early in his career: Senior Associate at Brockway Moran & Partners, the private equity owner of Gold’s Gym International, Inc; worked as an Associate at Donaldson, Lufkin & Jenrette; and an Analyst at Chase Securities. (Now JP Morgan.)
ISQ saw a need for a deeper & more useful level of education in the HALO sector. In response, we launched the HALO Talks podcast, with 500+ completed interviews and over 120,000 downloads. HALO Talks has become a “must listen” for anyone working or investing in the sector.
Pete graduated from Emory University (BBA, 1994) and received his MBA from Harvard Business School (1999.) While at HBS, he co-founded IRON PLANET, the leading B2B auction site for used heavy equipment, which was sold to Ritchie Bros for $758 million.
His hobbies include: Football, basketball, tennis, podcasting, amateur ventriloquism, pro bono DJ and fitness enthusiast.
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Find HALO Talks / Integrity Square at:
Website: https://www.halotalks.com
Integrity Square: https://www.integritysq.com
HALO Academy: https://www.thehaloacademy.com
LinkedIn: https://www.linkedin.com/company/integrity-square
YouTube: https://www.youtube.com/@halotalks
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#fitnessbusiness #mergersandacquisitions #privateequity
