A new $100 million round is giving a Boston-based sports tech startup access to the club of private companies valued at least $1 billion. Massachusetts has over a dozen members in the club.
Boston-based Whoop closed on Tuesday a $100 million financing, making the startup behind the eponymous fitness tracker a so-called "unicorn."
"We have real revenues, real customers, real gross margin profile," said Will Ahmed, founder and CEO of Whoop. "It gives us the ability to invest heavily in marketing, customer acquisition. It gives us more potential for strategic acquisitions down the road."
Whoop, like other fitness wristbands such as FitBit and Apple Watch, seeks to improve users’ health by tracking their activity, exercise, food, weight and sleep. The company sells the device and its companion software as part of a membership of $30 per month for a six-month commitment, among other deals. More than 60% of the company's workforce is based in Boston, including its research and development, human resource, finance, and marketing teams. Some employees in "membership services," or customer success, work from home throughout the country.
Over the last several months, the company has grown its workforce to a total of 330 people, following a hiring spree of over 200 new hires working mostly in "membership services." While declining to provide exact figures, Ahmed said that the number of memberships is now five times greater than it was 12 months ago, with revenue growing 380% over the same time.
"Covid-19 has shifted consumer psychology," Ahmed said. "People are realizing that health is very important and that health monitoring is a mechanism to really understand your body. And from that perspective, Whoop is becoming a product that people are more aware of."
The hiring spree is slated to continue thanks to the new funding, according to Ahmed. Over the next 12 months, Whoop will double its current workforce to almost 700 people by adding experts in software, hardware, analytics, as well as marketing and sales, Ahmed said. The company is targeting an international expansion in English-speaking countries, meaning it will invest in testing marketing and brand awareness outside the U.S., and adding more coaching and community features to its software.
Whoop is interested in acquiring companies working on accumulating data that can help customers improve their health. Whoop CTO John Capodilupo, a venture partner at Boston-based VC firm Accomplice, collaborated in the closing of a $5.25 million seed round for Synex Medical, a Canadian startup in the field of predictive blood testing that's planning a move to Boston. Ahmed declined to comment on Whoop's interest in acquiring Synex.
The Series E round, led by IVP, a California-based later-stage venture capital firm, brought Whoop's valuation to $1.2 billion and counts SoftBank Vision Fund 2 as a new investor. The investment comes less than one year after Whoop raised $55 million in a round led by Fitbit investor Foundry Group.
"We've been growing very fast as a business in the last 12 months, so we've used (the new investment) as an opportunity to take advantage of all that growth and again, reinvest back in the business," Ahmed said.
Massachusetts tech unicorns 2020
Valuation: $1 billion
Total funding: $422 million
Unicorn date: 05/06/2018
What it does: Low-code rapid application development software
HQ: Boston
Founding year: 2001
Valuation: $1 billion
Total funding: $263 million
Unicorn date: 02/13/2020
What it does: Financial services software
HQ: Boston
Founding year: 2009
Pictured: Mike Massaro (pictured) is CEO of Flywire
Valuation: $1 billion
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Unicorn date: 08/05/2019
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HQ: Boston
Founding year: 2012
Pictured: From left, Cybereason co-founders Yonatan Striem-Amit, CTO, Lior Div, CEO and Yossi Naar, chief visionary officer
10. Valuation: $1.053 billion
Total funding: $454.5 million
Unicorn date: 01/21/2020
What it does: Security software for developers
HQ: Boston
Founding year: 2015
Pictured: Guy Podjarny (left), founder and president of Boston-based Snyk, and Peter McKay, CEO
Valuation: $1.065 billion
Total funding: $103.2 million
Unicorn date: 08/01/2018
What it does: 3D printing
HQ: Somerville
Founding year: 2011
Pictured: The Formlabs printers are called Form 2, Form Wash and Cure
Valuation: $1.13 billion
Total funding: $318 million
Unicorn date: 03/06/2014
What it does: Data management, cloud backup and recovery
HQ: Waltham
Founding year: 2009
Pictured: Ash Ashutosh, founder and CEO of Actifio
Valuation: $1.2 billion
Total funding: $245 million
Unicorn date: 04/29/2015
What it does: Enterprise data and cloud storage software
HQ: Waltham
Founding year: 2011
Valuation: $1.25 billion
Total funding: $320 million
Unicorn date: 04/01/2019
What it does: Software for corporate catering
HQ: Boston
Founding year: 2007
Pictured: Stefania Mallett, co-founder and CEO of ezCater
Valuation: $1.26 billion
Total funding: $396.5 million
Unicorn date: 07/15/2020
What it does: The e-commerce company looks for top-reviewed products on sale on Amazon.com (Nasdaq: AMZN) and buys the brands from the third-party sellers. Then, it optimizes operations, taking care of branding and search
HQ: Walpole
Founding year: 2018
Pictured: Carlos Cashman, co-CEO and co-founder of Thrasio, started the company with fellow co-CEO and co-founder Joshua Silberstein
Valuation: $1.3 billion
Total funding: $431 million
Unicorn date: 09/17/2019
What it does: Artificial intelligence-based software for enterprise data analysis
HQ: Boston
Founding year: 2012
Pictured: The "Tech development area" at the office of DataRobot
Valuation: $1.4 billion
Total funding: $897 million
Unicorn date: 07/10/2018
What it does: Restaurant software
HQ: Boston
Founding year: 2011
Pictured: From left to right: Toast co-founder and president Steve Fredette; Toast CEO Chris Comparato; Toast co-founder and president Aman Narang; Toast co-founder and chief technology officer Jonathan Grimm
Valuation: $1.4 billion
Total funding: $1 billion and $116 million
Unicorn date: 12/06/2017
What it does: The agriculture-technology startup uses microbiology research to help farmers replace chemicals and fertilizers and increase crop yield
HQ: Boston
Founding year: 2013
Pictured: An Indigo grow room in Charlestown
