After massive layoffs, Cure.fit plans to monetise digital classes soon

Speaking on the scale of the impact to CNBC-TV18, Mukesh Bansal said, "Short term impact is significant and our fitness centres are not operational since 14th of March. We have taken stock of things in the last two months and we have tried to understand cutting measures to make sure that the company has a long runway so that we are able to withstand this shutdown period."

This move comes just months after Cure.fit raised Rs 832 crore in March this year, which one would assume will give enough runway for the startup to survive. But Bansal says that due to the lockdown revenues have taken a massive hit. "Our monthly fitness business was Rs 70 crore a month & has gone to zero overnight. Last 2 months we continued to pay salaries for all our employees, without any change. From this month onwards some of the places are shutting down, we had a bit of staff reduction and it affects only 10% of our trainers. We are retaining 90% of our trainers and we will continue to give salary for the foreseeable future."

The fixed costs for running a physical brick and mortar fitness center is extremely high and for Cure.fit that accounts to anywhere between Rs 10-12 crore. The team has initiated conversations with landlords and claims that while some have agreed to cooperate, conversations with others are still ongoing. Over and above that, Bansal shared that the cost of maintaining Cure.fit’s current trainers for a period of six months amounts to Rs 30 crore.

Cure.fit’s top goal at this point is to manage costs that buys them a longer runway to survive. A big part of this survival plan is pivoting to a digital only business model. Cure.fit has been running free live classes on the platform and has tied-up with multiple celebrities to produce masterclasses that attracted a huge fan base. So with offline operations coming to a complete standstill, monetising these digital classes within the next few weeks is key for survival.

"When we launched digital classes we did not know that this model will see such a high uptake from non-members as well. Now that the product has evolved, will feel confident and will start monetising live classes as early as next few weeks but it will also continue to have a freemium model," said Ankit Nagori.

The team also believes that gyms in their current form will not survive in the next 12 to 18 months and workout at home will become a credible option. All existing memberships will be retained, not a single day has been deducted and they have been given an unlimited pause.