Young Rich Listers buy back Sweat for a song

afr.com:

Kayla Itsines and Tobi Pearce have sensationally bought back Sweat, the fitness app they founded in 2015 and sold at the height of the pandemic in a $US150 million deal.

The Adelaide-based founders are believed to have bought Sweat for a fraction of what US-based iFIT Health & Fitness paid for it in July 2021, when many physical gyms around Australia and the world were shut due to COVID-19 restrictions.

Sweat co-founder Kayla Itsines, who with co-founder Tobi Pearce has bought the digital fitness empire back. Gavin Anesbury

Ms Itsines, who is this week headlining a fitness festival in Dubai, said iFIT wished to return to its core business of selling exercise equipment, while she wanted to concentrate on Sweat’s community of subscribers.

“The decision to regain ownership is about ensuring the best future
for Sweat,” said Ms Itsines, 32, who will continue as head trainer while Mr Pearce, 31, her romantic partner until 2020, will be a non-executive adviser.

“We have always been a platform built for women, by women, providing a secure and encouraging space for them to share their transformation journeys. Our commitment to this community remains unwavering.”

A source with knowledge of the deal said the pair had paid “nowhere near” the total value of the original deal with iFit to get Sweat back.

Sweat, which offers virtual workouts and fitness programs from a team of trainers led by Ms Itsines, pitched annual revenue of $100 million from 450,000 paid subscribers in the 2021 sale process that saw iFIT take it over.

However, revenue in the 11 months to May 31, 2022, was just $71 million. In financial statements lodged with the corporate regulator, iFIT’s new Australian subsidiary reported “headwinds of reduced customer demand