You just made the deadline on a hectic project, the next assignment is around the corner, it’s been a string of meetings since morning, and you’re only left with the energy to nod off once home. Why not clear your afternoon schedule, grab a quick workout and a healthy lunch, and then restart with a fresh mind? As radical as it sounds, the culture is prevalent in western countries and places such as Singapore.
Myntra co-founder-turned serial entrepreneur Mukesh Bansal and partner Ankit Nagori (ex-chief business officer at Flipkart) are on a mission to transport it to India with cure.fit. The duo exited Flipkart at the same time in February 2016 and remained keen on entrepreneurship. Given India’s growth potential in the healthcare space, an estimated $20 billion (out of the world’s $500 billion) as per the founders, in May 2016, Nagori and Bansal zeroed in on a start-up in this segment.
“The idea behind cure.fit is to make health easy for people. At cure.fit, we want to make available all the elements required for a healthy lifestyle in a personalised format,” Bansal says.
The concept caught the eye of Vani Kola, managing director and founder, Kalaari Capital during cure.fit’s early days. She was particularly impressed with the vision of the founders. In fact, she says, the passion and clarity of Bansal and Nagori is one of cure.fit’s highlights, alongside the large market opportunity.
They keep prices in an affordable range to increase their reach. Nagori says, “We want to be a large health and fitness brand. We want a few million people using our app (currently 400,000) in the next five years.”
Body, Mind and Soul
The ‘holistic health platform’, what the founders call their venture, comprises four verticals: cult.fit, eat.fit, mind.fit, and care.fit. Across four verticals, this barely three-year-old start-up caters to about 400,000 customers through more than 160 outlets (115 cure.fit, 25 mind.fit, 25 eat.fit, and three care.fit outlets) earning roughly 7billion ($100 million) in yearly revenue. cult.fit gymnasiums, with 180,000 customers, form the brand’s highest revenue-generating vertical.
cult.fit, the gymnasium chain, specialises in functional fitness workouts such as CrossFit training, kickboxing, Zumba and yoga. Most trainers here are professional athletes at either the state or national level. The chain was born of the company’s first two acquisitions, Cult in August 2016, for $3 million and The Tribe, chain of fitness centres in February 2017, for an undisclosed amount, both of which were Bengaluru-based. While elite gyms in the city charge between 25,000 and 30,000 for half-yearly memberships on an average, cult.fit charges 14,000-15,000.
They save on costs by optimising use of space and running fitness classes throughout the day. A single centre, each having two fitness studios, can host 18-20 one-hour-long sessions a day. With a class-size of even 20, you have nearly 600 people coming to a centre daily.
The start-up also has bespoke programmes in partnership with Hrithik Roshan, Tiger Shroff, and Milind Soman, celebrities known for their commitment to fitness.
Body and mind go together and mind.fit takes care of the latter. Formerly a1000yoga, Nagori and Bansal acquired Pradeep Sattwmaya’s venture for cure.fit’s meditation and mental wellness vertical in July 2017 for an undisclosed amount. “mind.fit is on expansion mode now, we’ve got about 25 centres across Hyderabad, Delhi and Bengaluru,” says Nagori. As of the last quarter, he says, this service has about 50,000 users, including an overlap with cult.fit users.
To address mental health issues such as depression, stress and anxiety, the brand recently introduced psychotherapy, after acquiring Dr Shyam Bhat’s popular Seraniti mental wellness platform in November 2018 for an undisclosed amount.
“Earlier, there wasn’t a brand that could help you with mental issues. You’d search on the internet when you needed a psychologist… you couldn’t even ask people because of the taboo around mental illness,” says Nagori. mind.fit works with yoga, meditation and psychotherapy, but the important starting point is a good night’s sleep. “If you go to a psychologist at mind.fit and say you sleep five hours a day, he’ll tell you to first start sleeping seven to eight hours and then come back,” he says.
Physical and mental wellness? Check. However, you need the right fuel to recuperate from the wear and tear. Enter eat.fit, which was born out of cure.fit’s acquisition of Kristy’s Kitchen, a Bengaluru-based online health-food delivery service, in March 2017 for an undisclosed amount. It was founded by Romanian entrepreneurs Cristina Maiorescu and Cedric Carvalho (presently FreshMenu’s chef operations) and Sumit Sinha (co-founder at Phable, a healthcare start-up) in 2016.
“We have a food philosophy document that we live by. It’s no refined flour, no refined sugar, and all our chicken is free-range,” says Nagori. Order a meal from eat.fit through the cure.fit app, or even via Zomato (exclusive tie-up) and you’ll notice the meals are calorie-counted and come with a nutrition chart. For a health-food restaurant chain, they are rather affordable too.
To expand its healthy food menu and also dip its toes in the FMCG waters, the brand will now launch an incubator programme. It is likely to invest $5 million in start-ups in packaged healthy foods and snacks space.
Meals typically cost 170- 230 while on Zomato, it’s cheaper; about 120-180 depending on the discount on the app. Being on Zomato hurts footfalls at eat.fit. However, the food aggregator contributes a healthy 20% to its 35,000 orders a day and roughly 210 million monthly revenue. “We maintain our pricing in such a way that we make our margins no matter how we sell,” says Nagori.
The fourth vertical under cure.fit is the care.fit chain of primary healthcare clinics. Through it, the founders hope to revive the family-doctor tradition.
“We have primary care for two reasons. One is for the health check-ups, based on which we can tailor your food and fitness plans. Second, people today don’t have an active relationship with their doctors. If you randomly visit doctors, they tend to overprescribe. But if you have an ongoing relationship with your doctor, he/she understands your health history and prescribes accordingly,” says Nagori.
The clinic chain uses a combination of offline and online touch points. Presently, there are two clinics in Bengaluru and a couple more coming up soon. Booking a consultation with a doctor or even a health check-up has to be done through the cure.fit app. Paid subscribers of care.fit have access to consultation over phone or video calls.
A consultation at the clinic comes at roughly 400-600, at par or just over the average amount you pay your friendly, neighbourhood physician. A couple of free follow-up visits are thrown in too.
A basic, full-body check-up — a haemogram, electrocardiography, diabetes screening and kidney function test — is done in less than an hour. Based on your reports, the doctor and the cure.fit team (comprising trainers and nutritionists) provide lifestyle plans which, as per Nagori, is the chain’s USP. This aside, cure.fit helps its clients manage conditions such as obesity, diabetes, heart-disease and asthma. It has helped under 1,000 customers so far across its three clinics. care.fit is currently in an experimental phase. The first centre has just about broken even, but the founders have already laid out the way forward. Since the brand has trainers, physiotherapists, and nutritionists on board, sports nutrition becomes the logical next step.
However, the bigger ace up care.fit’s sleeve is health insurance, to be ready by 2020. To stand out in the market, they provide customised lifestyle plans. Nagori says “It (their upcoming insurance plans) is a revenue stream for all our services. Imagine… what if an insurance plan came with a fitness class, discounts on healthy meals, or two free health check-ups?”
As per Bansal, the brand is growing at a strong 400% that he expects to sustain till mid-2020. It has raised a healthy $160 million so far and is set to raise another $75 million soon led by Chiratae Ventures and Accel Growth. The series-D round may add as much as $150 million to cure.fit’s kitty. Its investors also include IDG Ventures, Kalaari Capital, Flipkart co-founder Binny Bansal and Myntra’s Ananth Narayanan. Backed by such heavyweights, Bansal (Mukesh) confidently claims that cure.fit is one of the largest fitness chains in the country.
That said, the journey has not been without challenges. For one, expanding out of Bengaluru, cure.fit’s home ground, has been difficult. They are also present in Hyderabad and Delhi-NCR now. Nagori explains “Every city has its own geography and catchment which needs time (typically four to six months) to figure out. For the first two years, we were primarily a Bengaluru-based business.”
He says that about 5% of their centres didn’t quite take off because the initial offering was not what the customers were looking for. Later, they held activation events to draw the right crowd and let them know that the new centre has opened. He says that they now have a fair idea about the top 20 cities in India, and plan to be in 25 by end of next year.
Another challenge is to hire good trainers, chefs and manpower. cure.fit has set up a training academy in the Garden City, through which people can join its roughly 2,200-strong workforce. The academy, accredited by the fitness, sports and training bodies working under the aegis of the Government of India, is free for cure.fit’s staff.
The third hurdle was scaling-up care.fit. In India, primary healthcare has traditionally been a hard sector to expand in. This is down to the wafer-thin margins that most clinics work on. However, cure.fit has two advantages in this domain. First, it is a brand that is gaining wide acceptance thanks to its chain of gymnasiums and restaurants. Second, its lifestyle consultation programmes brings in clients.
However, the toughest challenge has been managing multiple verticals. Each vertical needs to be managed separately, with distinct technology. For instance, cult.fit requires management of its 115 retail centres across India. In gyms, you need enterprise resource planning (ERP) to manage members and their schedules step-by-step. “As with every multicategory platform, there are challenges we are trying to solve. So far, we have four categories. In the next five years, we may have 20, but we’ll launch only one to two every year,” says Bansal.
Kola acknowledges cure.fit’s break-neck growth rate and warns, “They have a high touch point with customers and a superior experience standard. So maintaining consistency as you scale is always a challenge. They need to scale people and processes even as the momentum accelerates.”
Be it Marathahalli, MG Road, Indiranagar or in fact any part of Bengaluru, you are likely to have a cult.fit and/or an eat.fit outlet nearby. He says, “We want to be in every neighbourhood of every city, or at most a five to 10-minute drive from every neighbourhood.”
In Delhi, cure.fit has about 20 outlets, 15 in Hyderabad, and 55 in Bengaluru (where the team aims for 100 outlets by next year). “By end of the year, we plan on reaching eight cities and touching 300 centres. By end of 2019, we want to hit 100,000 orders per day through eat.fit, which is about 3x our present numbers,” says Bansal.
Come June, the brand will spread its wings outside India with an investment of $15 million over the next 18 months. “We’re launching in Dubai in June and, by end of the year, we’ll have 10-12 cult.fit centres and two to three mind.fit centres there.” Later in 2020, Dubai will have its first eat.fit outlet.
With an expansion plan that rapid, one would expect a brand like cure.fit to consider the franchise route. But the start-up has no such plans. Nagori reasons, “For a model which has such strong returns, franchisees don’t make sense. Franchising is a funding model. We recover our capital for our centres in the first 12 months. In a five-year period, we are able to churn up 4x to 5x.”
Bansal has another reason for not venturing into the franchisee model: quality control. “We want to manage the entire chain, have control over the business end-to-end, and develop the user experience.” Bansal and Nagori have put their learnings from running Myntra and Flipkart to good use.
Bansal highlights how lessons — in managing growth, balancing profitability, offering what people want in the digital age and maintaining consistency over all channels — have held him in good stead while building cure.fit. That shows too, in the state-of-the-art services the brand has managed to deliver.