Business ideas: Fittech
You know there’s a growing start-up market when a sector has the word ‘tech’ bolted onto the end of it. Well now there’s fittech and it’s booming
Fintech, adtech, medtech, martech, fashtech; all start-up rich movements to bring digital innovation to a traditional market segment.
And now fittech – or fitness technology. An obsession with reps, tracking exercise, heart-rate monitoring and being told to ‘drop and give me 20’ has spawned a generation of gadgets, apps, and wearable tech to accessorise the desire to get fit. So much so that Stuff magazine was moved to dedicate a 17-page report and its cover to the tech that will make you “train like a geek” and “run like a robot”.
Fittech is essentially part of the enormous digital health market, which Monitor Deloitte’s Digital Health in the UK says was worth £23bn globally in 2014 and will almost double to £43bn by 2018. The UK market alone is worth £2bn and will grow to £2.9bn by 2018.
Starting a fittech company: Why it’s a good business idea
You’d think the big players such as Garmin, Fitbit, Strava and others would have it sewn up. And, let’s be honest, they do ‘own’ a sizeable chunk of the fittech market. But, fragmented as it is, innovations will continue to pour forth.
So if you’ve got a degree in engineering, can develop an app, or have an eye for product design – plus an in-depth knowledge of what fitness obsessives will need next – there are business opportunities to be found.
The growth of fittech has been fuelled by the spending power of a generation that wants everything connected to their smartphone, data on tap, and regards a #gymselfie as a crucial component of their social media output (it’s ok to be a little narcissistic now!).
Millennials, those born between 1980 and 2000, are reaching their peak spending years says Goldman Sachs. So, whether it’s smart watches, weighing scales, headphones or other devices that record your vitals, workout apps, or sports apparel and footwear logging your every move, there is money to be made if you can spot a ‘problem’ that hasn’t yet been ‘solved’.
Even Spotify’s getting in on the fittech act with its mobile running app playing music plucked from your listening history to match your pace. And that’s without delving into the potential role temporary tattoos and virtual reality gaming could play in the market.
Capture attention and a following for your app and the bigger sports brands will pay attention. Austrian fitness app Runtastic was bought by Adidas for €220m primarily for its 70 million registered members while Under Armour snapped up MyFitnessPal for $475m, MapMyFitness for $150m and Endomondo for £85m to access a combined fitness community of 120 million users.
Fittech business opportunities
Monitor Deloitte’s digital health report points to the “high consumer demand for mHealth apps”, but says monetising may prove a challenge. It highlights two segments where opportunities may emerge – low confidentiality data (personal wellness and activity data) and medium to high confidentiality data (health data and personal medical records).
The first is consumer driven and ideal for the fitness market, with data , valuable for marketing and product development. Furthermore, the report says the UK is “an attractive destination for app developers, with high levels of digital literacy and adoption, and a concentration of mHealth app companies around London”.
British social running app Racefully is a good example enabling users to run, train and race with each other. And staying with real-time social experiences, there's Zwift for cycling. The US-based turbo trainer videogame is already gaining traction, with its real-time gamification pitting indoor riders anywhere in the world against one another.
Breaking into wearable manufacturing is likely to prove harder, with a heavy concentration of venture-capital backed brands started in the US. A phalanx of activity tracking wearables with sensors transmitting data such as reps, calories, and movement to your smartphone while in some cases giving personal health and fitness insights now exist. These include Gymwatch, Whoop, Moov now, Misfit Shine, Jawbone Up Move, LumoRun, Track My Fitness, BSX Insight, Polar Loop, and Nabi Compete.
Movement and sleep tracking products from Fitbug, are one UK exception to the rule. The Middlesex-based company, which was started way back in 2005, was backed by the founders of gym chains LA Fitness and Holmes Place. Joining Fitbug with the “world's first modular smart watch” is Blocks, a London-based start-up that successfully raised £1.6m on Kickstarter.
Another growth area in the fittech space is smart apparel. “Tomorrow’s fittech will be woven into the fabric of your workout gear,” Stuff magazine says. It even highlights the creation of temporary biotech tattoos that use electro conductive paint to send your vital data to an app as a step beyond apparel.
Antelope is a German maker of sportswear with embedded electro-muscle stimulation technology designed to help users achieve more from their fitness regimen, with sensors directing the muscles to contract at the most effective time.
And French-Algerian engineer Karim Oumnia came up with shoe inner soles boasting the ability for users to select and regulate the temperature within your shoes from their smartphones.
The Digitsole’s Warm Series inner soles sell for $199 and Digitsole also claims to have created the world’s first smart shoes or connected footwear, which can be reserved pre-sale. It prompted USA Today to describe it as one of the five coolest things seen at CES 2016 this January.
Key to smart apparel success is making sure anything you create monitors and records a bunch of data, works via Bluetooth, connects to your own app, and has water resistant, breathable fabrics. No doubt smart functional and fashionable sports clothing will intersect at some point.
David Naylor, co-founder of social fitness app Racefully, says his business is among a number of UK start-ups seeking to seize some market share:
“Racefully, the social running app, Body.Network, an online fitness channel run by celebrity personal trainer Matt Roberts, and Dupl.me, which offers personalised coaching in fitness and nutrition, are three apps that take social exercise, group fitness and a live coaching experience out of the gym and into the hands of the user – wherever they are.
“I believe there's plenty of room for continuing innovation in wearables; it's such a new area. And you only have to look at what's going on in aligned areas like sensor technology and IoT generally to see there are significant opportunities here for sports and fitness focused businesses, too. So there's no question in my mind that there are also major opportunities for businesses that can develop exciting mobile health and fitness apps and platforms, which is what brings all this technology to life, and makes it really useful.
“We are seeing specialist health and fitness funds being set up in the US – for example the recently announced fund of Dick Costolo, the former Twitter CEO. I think it will come to the UK soon enough.”