Athletic wear retailer Lululemon is acquiring startup Mirror for $500 million in a move to capitalize on the boom in home workout solutions.
Mirror sells an interactive screen — which costs nearly $1,500 before tax and installation fees, plus ongoing subscription fees of $39 per month — through which customers can access its on-demand or live fitness classes.
Lululemon brought meditation classes to the Mirror platform after investing in the startup last year. It said the acquisition of Mirror would boost its “digital sweatlife offerings and bring immersive and personalized in-home sweat and mindfulness solutions to new and existing Lululemon guests.”
“In 2019, we detailed our vision to be the experiential brand that ignites a community of people living the sweatlife through sweat, grow and connect,” Lululemon CEO Calvin McDonald said in a news release. “The acquisition of Mirror is an exciting opportunity to build upon that vision, enhance our digital and interactive capabilities, and deepen our roots in the sweatlife.”
As TechCrunch reports, the deal “comes at a time when home workout solutions are in high demand. The COVID-19 pandemic has severely limited workout options for many across the world, and the continued closure of gyms has prolonged the problem.”
“Even when they begin to reopen in different locales, it seems many will be wary of returning to a potentially high-risk enclosed space, so long as the virus continues to spread,” TechCrunch added.
Mirror was founded by Brynn Putnam, a former dancer for the New York City Ballet, after she struggled to fit workout classes into her schedule as a pregnant fitness entrepreneur. The company raised $34 million in a funding round last year, valuing it at around $300 million.
On news of the deal, Lululemon’s shares jumped 5.2% to $309.65 in trading Tuesday.
“While Mirror is relatively small today, it should increase Lululemon’s mind share while also being incremental to Lululemon’s long-term growth targets,” Needham analyst Rick Patel said in a client note, adding, “Lululemon is thinking outside the box and moving to where the puck is going.”