Stockhead: Bailador flexes gains from tech-driven fitness platform Hapana with 50pc value uplift
- Bailador revalued holding in fitness studio management software platform Hapana up by 50%
- Since investment in August 2024, Hapana has grown rapidly with new customer wins and account expansions
- Bailador says Hapana demonstrates characteristics it seeks in high-growth tech companies
Special Report: Tech-centric capital fund Bailador Technology Investments is reaping the benefits of its investment in Hapana, an end-to-end software platform servicing the fitness and wellness sector.
Bailador Technology Investments (ASX:BTI) revalued its holding in Hapana upwards by 50%, or $3.9 million, to $11.6m in June.
BTI co-founder Paul Wilson said since its initial investment of $7.7m in August 2024, Hapana had delivered strong execution across multiple fronts, validating its investment thesis and demonstrating characteristics it seeks in high-growth tech companies.
“The company has grown rapidly since our initial investment, driven by both new customer wins and account expansion from existing customers,” Wilson noted.
Client wins lead to expansion
Wilson said during the past year Hapana had signed several new clients including:
- Fitstop – A growing Australian brand with 150+ locations operating in four countries.
- Joy In Movement (JIM) – a new fitness franchise with ~5 locations open and potential to expand to 50-plus locations.
- Flex Fitness – One of the largest multi-unit brands in New Zealand in the mid-box space with 40-plus locations.
- SpeedFit – A fast-growing boutique electro muscle stimulation (EMS) concept with more than 25 locations in Australia and New Zealand.
- Tan Republic – A 60-plus location tanning salon group in the US.
Hapana’s anchor clients have grown significantly over time, said Wilson, with the platform growing alongside them.
For example, Body Fit Training (BFT) has expanded from five outlets to more than 300 locations worldwide, while KX Pilates has grown from 60 locations to more than 120 globally.
“A core part of our investment thesis for Hapana is its targeted focus on fast-growing fitness franchises with the potential to expand as they add more locations,” Wilson said.
“The company continues to target businesses with 2-10 locations as well as established franchises, recognising that many smaller brands are experiencing rapid expansion.”
He said targeting fast-growing fitness franchises provided Hapana with a powerful and efficient growth engine.
“This has driven strong customer account expansion metrics, which, combined with new customer wins, has fuelled rapid revenue growth,” he said.
Some of Hapana’s other customers include KX Pilates, Strong Pilates, InLife Wellness, VAURA, Gold’s Gym, and F45.
Rapid scaling of team as platform grows
Wilson said there are now 2.5 million check-ins per month across fitness and wellness chains using Hapana’s software, which is on track to process $1 billion in payments in the 2025 calendar year.
Bailador’s investment has been used to grow the team and enhance the product.
“Since its investment, Hapana has grown from around 70 staff globally to ~120, with Australia the largest centre, hosting ~45 people based predominantly in Sydney,” he said.
“Hapana has brought in new leadership hires and established a HQ in Sydney, which will become the global R&D hub.
“Encouragingly, the company has attracted top talent from companies such as Google, Salesforce, Deel, Zoom, and Hubspot.”
AI-focused product development
Wilson said Hapana was also using the raise proceeds to re-platform its technology stack to make it ‘AI-first’.
“The aim is for Hapana to be a first mover in the industry with AI, both in terms of how it’s built into the platform and how it’s used within the business,” he said.
He said the company continued to execute well against Bailador’s original thesis including:
- High-quality founder and executive team, with new hires strengthening the team since its investment.
- Strong market presence in Australia, with material opportunities for growth internationally.
- Strong product-market fit and a compelling value proposition versus legacy incumbents evidenced by new customer wins and quality of customers.
‘Long runway of growth ahead’
Wilson said with strong unit economics, proven ability to attract and retain quality customers, and a clear technology roadmap leveraging AI capabilities, Hapana remained well positioned to capitalise on the substantial global fitness software market opportunity.
“In addition to the strong growth since our investment, we believe Hapana still has a long runway of growth ahead,” he said.
“As with historical growth, we expect future revenue growth to continue to be driven by both new customer wins and expansion from existing customers as they add new locations over time.”