Smart home gym-maker Tonal is slashing 35% of its workforce — adding to a growing list of connected fitness companies restructuring their businesses, according to CNBC.
Tonal — backed by a star-studded group of investors including Serena Williams, LeBron James, Steph Curry, and others — is cutting its workforce to become profitable as it aims to go public.
- The fitness company currently employs roughly 750 people.
- Before the pandemic, its workforce stood at just over 110 employees.
- The company has yet to become profitable since its launch in 2015.
- It also plans to cut back on advertising to alleviate customer acquisition costs.
Tonal benefited from high demand for connected fitness equipment during the pandemic. In March 2021, it completed a $250 million Series E funding round at a $1.6 billion valuation.
Led by Dragoneer Investment Group, the round included L Catterton, Sapphire Ventures, Cobalt Capital, and athletes Drew Brees, Mike Tyson, Sue Bird, and Maria Sharapova.
To date, Tonal has raised $450 million in fresh capital.
Tonal joins Peloton in connected fitness companies cutting jobs. On Tuesday, Peloton announced it will suspend operations at its Tonic Fitness Technology, Inc. facility. Around 600 Tonic employees will be laid off as part of the transaction, according to Bloomberg.
Peloton acquired the Taiwan-based equipment manufacturer in 2019 for $47.4 million.