The Gym completes £250m London listing – further proof that commercial growth and social impact can go hand-in-hand

9th November 2015

Bridges Ventures co-founded The Gym alongside John Treharne in 2007 after incubating the concept in-house, in line with its ‘health and well-being’ impact focus The Gym pioneered the low-cost gym model in the UK and now has more than 60 sites About a third of its 360,000 members were not previously members of a gym […]

  • Bridges Ventures co-founded The Gym alongside John Treharne in 2007 after incubating the concept in-house, in line with its ‘health and well-being’ impact focus
  • The Gym pioneered the low-cost gym model in the UK and now has more than 60 sites
  • About a third of its 360,000 members were not previously members of a gym
  • Bridges sold a portion of its stake to Phoenix Equity Partners in 2013, to fund the next phase of The Gym’s growth
  • Today’s IPO – which values the business at £250m – means that Bridges’ investment in The Gym is now valued at almost 6x cost

The Gym Group (“The Gym”), a low-cost gym operator backed by Phoenix Equity Partners (“Phoenix”) and Bridges Ventures (“Bridges”), has successfully sold shares equivalent to 50% of the company via an offering on the London Stock Exchange. The initial offer price values the business at £250m.

Bridges co-founded The Gym alongside CEO John Treharne in 2007. In 2013, it sold a portion of its stake to Phoenix, retaining a 25% shareholding. Based on today’s float price, Bridges’ investment in The Gym is now valued at about 5.8x cost. It will realise a portion of that, while retaining a significant minority stake in the business post-IPO to benefit from its future success.

Bridges, a specialist sustainable and impact investor, originally invested in The Gym in line with its focus on backing for-profit companies that are helping to address big societal challenges in areas like health and well-being. Given the success of low-cost models in sectors like hotels and air travel, and the relatively low penetration of gym membership in the UK, Bridges theorised that a low-cost gym concept attracting a much broader demographic than traditional health clubs would have a clear growth opportunity – while also helping to promote healthier lifestyles and combat chronic conditions related to obesity. Since no such model existed in the UK, Bridges incubated the concept in-house and teamed up with John Treharne to co-found The Gym in 2007.

Prior to launch, the Bridges team – led by managing partner Philip Newborough – worked in tandem with John to develop the member proposition, design the technology infrastructure and identify a suitable location for the launch of The Gym’s first site, which opened in July 2008 in Hounslow. Subsequently, Bridges supported John on everything from identifying new sites, to obtaining bank finance, to strengthening the team and board. Bridges has continued to be an active minority investor since Phoenix became the majority owner of The Gym in 2013.

As of 30 September 2015, The Gym had expanded to incorporate 66 sites across the UK, with some 363,000 members.

Importantly, in addition to its commercial success, The Gym has had a clear and demonstrable positive social impact. About two-thirds of its sites are located in under-served areas, while around one-third of its members have not been members of a health and fitness club before. Thanks to its low price point, no-contract environment, and extended opening hours (most of the sites are open 24/7, and roughly one in ten members use it between the hours of 10pm and 6am), The Gym has been able to open up gym access to an entirely new demographic.

In addition, The Gym is providing employment to around 200 full-time employees and contracts with more than 550 self-employed personal trainers. And in recent years, it has been working hard to minimise its carbon footprint: through investment in the latest technology and equipment, it has been able to substantially reduce its electricity usage per user over time.

Philip Newborough, managing partner of Bridges (who has been on the board of The Gym since inception, originally as executive chairman), said:

“The Gym shows what can be achieved when impact-driven investors join forces with talented and visionary entrepreneurs. By focusing on how to address one of the biggest challenges in the health and well-being space, we were able to identify this sector as an opportunity. And by working with John, his talented team, and more recently Phoenix, we’ve been able to build a high-growth, high-impact business that has brought the benefits of gym membership to hundreds of thousands of people who have never been members of a gym before. So it’s a perfect illustration of Bridges’ core thesis: that positive social impact really can drive commercial success, and vice versa. We fully expect that, under John’s leadership, The Gym will continue to go from strength to strength as a public company.”

John Treharne, CEO of The Gym, said:

“The strength of our relationship with Bridges has been critical to The Gym’s success. Obviously it provided the capital we needed to grow and open new sites. But it’s been much more than that: particularly in the early days, Bridges provided The Gym with the kind of services that a small business would really struggle to afford, from building financial models to negotiating with the banks. We’re proud of the positive social impact we’ve been able to achieve together since 2007 as the business has grown, and we look forward to this continuing in the coming years.”


Notes to editors

About Bridges Ventures

Bridges Ventures is a specialist fund manager focused exclusively on sustainable and impact investment, with offices in London and New York. It invests in high-impact SMEs, properties and social sector organisations that can generate superior returns for both investors and society as a whole, focusing on four key impact ‘themes’: health & well-being, education, sustainable living and under-served markets. It manages almost £600 million across its Sustainable Growth, Property and Social Sector funds.


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