Digme Fitness EIS

Update (4 Oct 2019): Offer closed

This offer has now closed. Any applications already submitted will be processed on a first come, first served basis.

This is an opportunity to invest in the second EIS raise for Digme Fitness, an established boutique fitness studio operator providing Spin (indoor cycling) and HIIT (High Intensity Interval Training) sessions. 

Wealth Club clients can exclusively participate alongside West Hill investors. The minimum investment – exclusively for Wealth Club clients – is £20,060.

Interested? Read our free research report and apply online now.

Highlights

  • Second round £3 million EIS offer
  • Expects to allot this tax year (not guaranteed)
  • Established branded fitness operator seeking additional funding to scale up significantly in a fast-growing, fragmented market
  • Six existing sites to date (including a recent site acquisition), five of which are forecast to be EBITDA profitable in 2019
  • Professional, driven and hands-on team who are fitness enthusiasts themselves
  • Target returns of 4x–5x money invested (before tax relief) – not guaranteed
  • EIS Advance Assurance received
  • Single company private EIS offer for experienced investors only
  • Minimum investment – £20,060 (exclusively for Wealth Club investors)
  • You can apply online. You will also need to become an “elective professional client” of West Hill before your investment is accepted.

Important: The information on this website is for experienced investors. It is not advice nor a research or personal recommendation to invest. If you’re unsure, please seek advice. Investments are for the long term. They are high risk and illiquid and can fall as well as rise in value, so you could get back less than you invest.


The offer

This is a further EIS fundraising round for Digme Fitness Limited which first raised money from EIS investors in late 2017. The business has now opened six sites (five of these are expected to be EBITDA profitable in 2019). It is now raising more capital to scale-up its operations and increase market share.

Digme is a boutique fitness studio operator providing Spin (indoor cycling) and HIIT (High Intensity Interval Training) sessions. The sector, whilst growing fast, is highly fragmented as most players in the UK are single-site operators. Any company that is the first to scale in this market could create a business of real value.

Named after the inspirational Hawaiian beach at the start of the annual Ironman World Championships, Digme provides a premium service to consumers giving them the inspiration and motivation to progress towards their fitness goals. 

Digme offers expert-led Spin and HIIT sessions that stretch customers far more than self-led training, but at a much lower price than one-to-one coaching.

Digme aims to open 15 more studios across the UK by 2023 and become the UK’s largest “pay-as-you-sweat” boutique fitness studio. The Company is seeking up to £3 million to deliver its planned rollout. 

Management team

The team is led by Digme’s founders, husband and wife team Geoff and Caoimhe Bamber. They are both keen fitness enthusiasts (Geoff has completed 11 Ironman triathlons, including the Ironman World Championship in Hawaii. Caoimhe has completed 75 marathons, 10 ultra-marathons and an Ironman triathlon). 

Geoff has enjoyed a long and successful career in investing and finance and Caoimhe is a commercial lawyer. Their passion for-high quality workouts comes through in every minute detail of the Digme studios.

Exit options

Digme operates in a fast-growing emerging industry in the UK with well-established trade operators and private equity backers in the US. The exit options for a market-leading scaled fitness studio in the UK are numerous, including IPO, private equity or sale to a large trade operator. Savvy investors buy into the people and passion behind the brands and in our opinion, providing the Company can continue to find suitable sites and scale ahead of competitors, Digme is well positioned to benefit here.

Management do not envisage seeking an exit for at least three years although timescales and exit options are not guaranteed. 

Risks – important 

This, like all investments available through Wealth Club, is only for experienced investors happy to make their own investment decisions without advice.

EIS / SEIS investments are high-risk so should only form part of a balanced portfolio and you should not invest money you cannot afford to lose. They also tend to be illiquid and hard to sell and value. Before you invest, please carefully read the Risks and Commitments and the offer documents to ensure you fully understand the risks. 

This is a single company EIS offer with no diversification. It involves investing in an early-stage business which is by nature high risk and prone to failure. You could lose the amount you invest.

The value of tax benefits depends on circumstances and tax rules can change. 

Fees and charges

Investors are investing in the company directly so will pay no direct initial or ongoing charges. West Hill will pay an introducer fee to Wealth Club of 3.3%.

Our view

Whilst Digme is behind the forecast set at the time of its first private offer, the Company has achieved significant growth at its four established sites and has demonstrated site maturity, with two sites moving to profitability at the divisional level (excluding corporate costs) during 2018.

The opening of the flagship studio at Rathbone Square has helped develop the brand further, while the launch of the Company’s proprietary app should strengthen brand loyalty. 

With the UK health & fitness industry showing continued growth, but still lagging behind the US, there looks to be an opportunity for a market leader to reap significant rewards. The real question is which of the boutiques will gain the market-leading position. At the time of writing, no company seems to be the clear UK market leader, and Digme seems well placed to seize this opportunity given its brand, unique offering, recent growth and current scale, assuming it can deliver its plans successfully. However, securing the best sites in desirable, well connected areas ahead of competitors remains key.

A look inside Digme Fitness


Wealth Club aims to make it easier for experienced investors to find information on – and apply for – tax-efficient investments. You should base your investment decision on the provider's documents and ensure you have read and fully understand them before investing. This review is a marketing communication. It is not advice or a personal or research recommendation to buy the investment mentioned. It does not satisfy legal requirements promoting investment research independence and is thus not subject to prohibitions on dealing ahead of its dissemination.

The details

Type
Single company
Sector
Consumer
Target return
-
Funds raised / sought
-
Minimum investment
-
Deadline
CLOSED
Last updated: 4 October 2019

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