Viewing 40 posts - 1 through 40 (of 62 total)
  • Is Peloton really worth $8bn?
  • Matt24k
    Free Member

    Tech IPO’s never cease to amaze me but seriously WTF!
    link
    Has anyone on here actually spent £2k on an exercise bike and committed to £40 a month app subscription?
    I’d be really interested to hear an actual real world users thoughts.

    Poopscoop
    Full Member

    I know it doesn’t mean a damn thing in this context but isn’t it losing a tonne of money?

    mashr
    Full Member

    Sounds like a bubble that’ll burst before too long

    itlab
    Free Member

    It does seem excessive. For a company that is loss making.

    And I can’t help but think all the advertising we have been seeing is as much for the benefit of the ipo as to increase sales.

    The key to the price is can they retain existing customers and continue to grown. Or is it just a fad. I lean towards the second n option but I very much doubt that singletrack forum users are the target market

    Matt24k
    Free Member

    $200m loss on $1bn revenue last year.
    The IPO documents reckoned that they have a potential US market of 45 million households and globally 67 million. Just can’t see it myself.

    scruff9252
    Full Member

    IPO’s are about raising capital for the founders, not primarily making profit for investors. Their initial offering is more linked to what they think they can get away with than what it’s worth. See Aston Martin;

    https://www.theguardian.com/business/2019/feb/28/aston-martin-sets-aside-30m-for-brexit-as-revenues-rise

    So no, I don’t think Peleton is worth billions.

    CaptainFlashheart
    Free Member

    Could I interest anyone in some tulips?

    peterno51
    Full Member

    Is the draw of getting individual health performance metrics of rich Americans??

    eddiebaby
    Full Member

    Is the draw of getting individual health performance metrics of rich Americans??

    Only if you have a time machine.

    tenacious_doug
    Free Member

    We are not really their target, so whether anyone here has one and likes it probably isn’t hugely representative. I know people with it who love it, they wouldn’t otherwise be riding bikes.

    I know it doesn’t mean a damn thing in this context but isn’t it losing a tonne of money?

    I took a look at the analysis of their S1 and if I recall a lot if not all of the losses are due to very high marketing costs currently as they try to grow new subscribers, the plan over time would be that this marketing investment reduces as it’s cheaper to retain existing customers than attract new ones, making it profitable. This is quite different to a lot of tech IPOs where they don’t make a profit any which way you cut it.

    thepurist
    Full Member

     I very much doubt that singletrack forum users are the target market

    Exactly – go to any spinning class and I’d wager there will be a bunch of regulars who would never even consider actually riding a bike. They’re likely to be paying around the same monthly cost for their classes as they would for Peloton, so they “just” need to be convinced that the up front cost is worth it to bring the gym to them and give them more flexibility over when they want to do a class.

    Of course then they still need to fund the penthouse apartment or luxury basement to stick the bike in.

    w00dster
    Full Member

    I think this was discussed previously on another thread?
    Anyway, I spent a fair bit of time humming and harring about joining. The wife wanted me to join so she could use it as well.
    In the end I decided it was for less serious cyclists as it was all HIIT related. In the end I bought a Watt Bike and Sufferfest membership. Probably also going to go down the Zwift route as well.
    Financially, it was a lot more than what the Wattbike and suitable cycling specific training app/memberships cost. But I can see the benefit/sales pitch for people who want to use it for their workouts rather than joining a gym or Spin Class.
    I also am a member of a Gym (David Lloyd who have Watt Bikes and Spin Classes) and a “trendy” spin club in London (1Rebel). The 1Rebel club is expensive, I no longer do the monthly subscriptions as I’m only in London 3 or 4 days a month, so its £18 per session. I think 7 day a week membership is about £250 a month. Which is comparable to Peloton over time. I’m also an infrequent user of Athlete Lab in London, this is cycle specific, individual session is £30 and 10 sessions is £240. David Lloyd with Watt Bikes is £130 per month and this allows me to use other gyms (excluding sone in Central London).
    My Wattbike is approx £1600, Sufferfest is £12 (ish) per month.
    I think given the price, Peloton is targeting a specific market. I don’t think actual cyclists who want structured training will use it. There does appear to be a lot of folk who can afford it.
    Hopefully the above gives some comparable price points rather than just the usual Three Thousand Pounds for a spin bike!

    peterno51
    Full Member

    Only if you have a time machine.

    Huh?

    TiRed
    Full Member

    Never underestimate the size of the clothes hanger market. After all, everyone wears clothes.

    See WeWork… not a chance, just chancing their luck.

    grahamt1980
    Full Member

    CFH – love the reference there. Good work

    Poopscoop
    Full Member

    I know little about the system in truth but it looks a little primitive in the adverts?

    What I mean is, the huge screen etc looks great… then the user has to take a hand of the bar to twist ye olde resistance knob. Seems primitive in this age of smart trainers.

    footflaps
    Full Member

    See WeWork… not a chance, just chancing their luck.

    The weirdest thing about WeWork is it’s not a new business model and there are public comapanies doing the exact same thing you can compare and contrast with; all of whom are valued considerably lower….

    CFH – love the reference there. Good work

    It was a stealth add, he’s still trying to offload them from 1637…

    the-muffin-man
    Full Member

    What’s up with a turbo trainer in a cold damp garage – ruddy snowflakes! 🙂

    eddiebaby
    Full Member

    Only if you have a time machine.

    Huh?

    https://en.m.wikipedia.org/wiki/Tulip_mania

    EDIT Just realised I quoted the wrong text, should’ve been Flashy’s tulips. Anyone got a time machine?

    Poopscoop
    Full Member

    I thought you was just being surreal eddie!😆

    yourguitarhero
    Free Member

    Those London gyms are expensive!

    I got to the PureGym, and it’s £21 a month – and that lets me use other ones too.

    mogrim
    Full Member

    Financially, it was a lot more than what the Wattbike and suitable cycling specific training app/memberships cost. But I can see the benefit/sales pitch for people who want to use it for their workouts rather than joining a gym or Spin Class.

    You’re talking London prices for upmarket gyms – undoubtedly the kind of disposable income Peloton’s target market should have – but is that really going to get them 45M clients in the US / 67M worldwide?

    Matt24k
    Free Member

    Some more interesting reading here

    1.4m subscribers and 400k bikes sold.

    Just think of the amount of unused rowing machines and exercise bikes there are in households already. I appreciate that there is a market for this but no where near the size required to justify the valuation.

    jimdubleyou
    Full Member

    What’s the churn on users? Is it in the IPO docs (I work in a bank and we’re not allowed to look at such things)

    I’m guessing low-medium based on the entry point of the machine you need to buy (+ the custom cedar platform looking out through your picture window onto the forest). $40 a month probably isn’t that much if you’ve spent $3000 on the toy.

    What’s the profit point on a new user? How long does a user have to subscribe before peloton see a profit. edit: I see the article mentions $5, that sounds like BS…

    I can’t see the figures, but it does seem a little high.

     potential US market of 45 million households

    There are 130 million households in America – they are seriously suggesting they will be in 30% of US households?

    footflaps
    Full Member

    Just think of the amount of unused rowing machines and exercise bikes there are in households already.

    Tell me about it, the wife bought a spin bike which sat in the workshop for years having been used less than a dozen times. Total PITA, weighed an absolute ton, so really hard to move out the way etc. Finally managed to get rid of it this year….

    fossy
    Full Member

    Bloody massive exercise bike in my garage – MIL ‘gave’ (insisted we take it) one to us about 10 years ago – been used about twice. Me, I’ll stick to real bikes, or a real bike on a Smart Turbo and Zwift

    forzafkawi
    Free Member

    Can anybody point me to the earlier Peloton thread with the pictures of millionaire numpties in their loft apartments? I’ve done a search on STW but can’t seem to find it.

    jamiep
    Free Member

    you’ll find it on twitter. I did by searching for the most memorable words: half gay architecture husband

    zilog6128
    Full Member

    this was all pretty much covered in the previous thread. It’s aimed at the “city spin” market – where I guess it’s actually pretty well priced comparatively – not at people who like to ride bikes. Cannot see it lasting long term; I guess it hinges on how long the current spin craze remains popular (or how long they can hemorrhage money before the investors pull the plug!)

    P-Jay
    Free Member

    Nah, it’s very fashionable at the moment in certain circles but they’ll be onto the next thing soon and their market will shrink to it’s true level. I don’t think they have anything unique to offer.

    Ro5ey
    Free Member

    in the IPO docs (I work in a bank and we’re not allowed to look at such things)

    That’s a bit strange ….. the P stands for public !!

    perchypanther
    Free Member

    their market will shrink to it’s true level

    There will be a booming market in second hand Peleton bikes though…

    timbog160
    Full Member

    I think it is almost certainly overvalued like a lot of these things – Aston Martin for example. Equally though it is not aimed at cyclists but fitness enthusiasts. My reading of various reviews suggests that if you’re into that kind of thing the quality of the bike itself isn’t great, but the classes can be quite good. So their hardware could be a bit of an Achilles heel, but it is the subs where their profit will be if they can keep adding users at a good rate…

    oldnpastit
    Full Member

    I don’t think they have anything unique to offer.

    They will sell advertising on those screens, that’s why they’re so huge.

    Just imagine, a captive audience of high net-worth individuals. That’s easily worth $8Bn.

    dom777
    Free Member

    This article might be of interest. Its not really an isolated thing.

    https://www.bloomberg.com/graphics/2019-unprofitable-ipo-record-uber-wework-peloton/

    footflaps
    Full Member

    I did by searching for the most memorable words: half gay architecture husband

    Yet another sub niche I knew nothing about!

    footflaps
    Full Member

    This article might be of interest.

    Nice read, I think this explains a lot..

    “With mega-banks, the capital is not really anybody’s money who you’d need to talk to in person and say, ‘I’m really sorry,’” Wallace said.

    thisisnotaspoon
    Full Member
      £2k is a lot of £££, but compared to other aspirational fitness purchases, a C2, waterrower, 105/carbon road bike, multigym/squat cage and weights, it’s at the high end of the same ballpark. And unlike most of those there’s a cat in hell’s chance of being allowed to put it in the dining room rather than the shed.

      If you break it down to a basic bike (~£500), Tacx Neo (£1000), mini-pc (£300), TV (£300) it’s about the same price as the hardware required for Zwift. Zwift just has the advantage of the target audience already having the bike, and TV, and maybe PC, and functioning at the entry level with a dumb trainer.

      I got to the PureGym, and it’s £21 a month – and that lets me use other ones too.

      They’re clever though, to put it bluntly you can only use other gym’s north of your home town as it’s restricted to gyms with a lower monthly fee than your own. So I could use the ones in Liverpool on a work secondment, but if a colleague did the opposite trip to Reading they couldn’t (unless they joined the Reading gym).

    footflaps
    Full Member

    If you break it down to a basic bike (~£500), Tacx Neo (£1000), mini-pc (£300), TV (£300) it’s about the same price as the hardware required for Zwift.

    Not really, a basic smart turbo is under £500 and you can use the phone / iPad you already have….

    Klunk
    Free Member

    What’s up with a turbo trainer in a cold damp garage – ruddy snowflakes!

    what’s up with a riding a bike on a cold damp road bloody snowflake ! 😉

Viewing 40 posts - 1 through 40 (of 62 total)

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