Weight Loss Clinics acquired as Xponential Fitness business model questioned

December 8, 2023

Karen Sweaney

Xponential Fitness, the largest global franchisor of boutique fitness brands, is acquiring weight loss and wellness clinic operator Lindora.

The announcement on the acquisition of Lindora comes at a time when franchisees of Xponential Fitness brands in the USA including Pure Barre, CycleBar and Row House are using social media to vent their frustration and alarm over payment issue.

Lindora has 31 existing clinics across Canada and the United States with Xponential Fitness to acquire Lindora’s intellectual property and take over the 31 existing clinics, with plans to franchise the brand globally.

Lindora acquisition
Founded in California, USA in 1971, Lindora clinics offer a suite of services that support metabolic health, including weight management programs that incorporate nutrition, lifestyle, and the latest innovations in weight loss medications ike Ozempic; IV hydration; hormone replacement therapy; and other services.

Lindora’s presence in Australia and New Zealand is currently via its Healthpointe program developed by the Lindora Clinic to teach people how to lose and maintain a healthy weight. Healthpointe provides meals plans, educational material and a support system. The program focuses on eating less processed carbohydrates, moving more and changing your thinking.

Anthony Geisler, Chief Executive of Xponential noted “this acquisition further solidifies Xponential’s leadership in identifying and incorporating the latest innovations in health and wellness.

“We have long admired Lindora’s integrated approach to metabolic health, effectively combining behavioral approaches with the most recent medical breakthroughs, from weight loss medications to hormone replacement therapy and IV hydration. Lindora complements our existing brands and will help us deliver on consumers’ increasing demand for a holistic approach to health. Lindora is led by a veteran team, and we are looking forward to partnering with them to address some of the most critical and widespread health challenges facing the U.S. and beyond.”

Lindora Chief Executive, Colleen Lewis, added “we are thrilled to join the Xponential family of brands. Xponential’s proven model growing and scaling brands makes them the ideal partner as Lindora enters its next phase of growth.

"This partnership will allow Lindora to become one of the first national brands in medical metabolic management, and we are energized to share what has been effective in delivering outstanding outcomes for our valued clients with people on a global scale.”

The transaction is expected to close in early 2024.

The global weight loss and weight management industry had a market size of over $224 billion in 2021 and is expected to surpass $400 billion by 2030.

Xponential Fitness business model in question
The announcement by Xponential Fitness on its acquisition of Lindora comes at a time when many existing Xponential brand franchisees in the USA are venting their frustration and alarm on lack of payment via social media.

Xponential currently owns 10 fitness brands across its portfolio, including Club Pilates, CycleBar, Rumble, StretchLab, Row House, Pure Barre, AKT, YogaSix, STRIDE Fitness, and BFT.

Posts on social media claim that last month “Xponential Fitness sold off over 66 locations between PureBarre, CycleBar, AKT, etc to a company called MD Professional Holding LLC and have been fraudulently selling failing XPO brand locations throughout the United States”.

Posts share “the new company that owns all of us has not paid their employees, they are not responding to emails/phone calls, and previously sent correspondence with inappropriate verbiage and shows great unprofessionalism. Some of these studios have since gone on strike, are filing with their state DOL, and taking other legal action. I hope XPO gets nailed for ruining all of their employees livelihoods. All XPO has to say we have reached out is that they ‘apologize for our experience’. They must be held accountable.”

A social media post from a struggling Row House Franchisee in Naperville, USA recently statred “as some may be aware, we were acquired by MD Professional Holdings, LLC, on October 1st. Since their acquisition, along with 65 other studios around the country, MD Professional Holdings has failed to pay their almost 900 employees. Some of these studios have not received pay since September 1st. We have yet to receive a single paycheck from their company.

“MD Pro and their owner, Mitch Brown, have been unreachable. We have been consistently reaching out, along with the other studios. We have also reached out to our old company, Xponential, and received responses like ‘Best of luck’. Most of us have filed wage complaints with the DOL. This has yet to rectify the situation.

“We have tried to remain open for as long as possible so we can still support our local community as much as we can. It has gotten to the point where we do not have the staffing to remain open or funding to remain operational until the payroll situation has been sorted out. This has been a heartbreaking decision to come to, and we wish it never had to be. It is our last resort. We are all ready to jump back in as soon as we are able. We are not leaving for good. We are hoping this stage is only temporary.”

The number of Xponential Fitness Franchisees expressing their frustration on social media is growing.

Xponential Fitness CycleBar reportedly called an emergency meeting in Dallas on 1st November with a Franchisee noting “after getting caught in years of lies about ‘no studios have ever closed permanently’, Xponential has now done a 180 degree turn and admits 30+ studios have closed including several of their own corporate owned studios. Dozens more are about to close soon.”

The social media posts are directing readers to research by financial services blogger Fuzzy Panda released in July this year which claimed that many of Xponential Fitness "brands and franchisees are struggling".

The research made unfavourable claims about Xponential Fitness Chief Executive Anthony Geisler and the business’s current trading position which saw shares in the New York Stock Exchange listed company drop 42%.

In response, Xponential Fitness’ Directors called the report “misleading” and “inaccurate”, backed by positive statements from other analysts, such as Raymond James - who said the response of the market was “overdone”.

In support of Geisler, who Fuzzy Panda accused of selling off his equity, Xponential Fitness confirmed he owns 8.2 million shares in the business - a larger shareholding that the company’s top five outside institutional investors combined.

Fuzzy Panda are now reporting via social media “the law firms of Bovino, Praxidice, and Amaro asked us to share that they are representing franchisees vs Xponential Fitness. They are preparing a lawsuit and 50+ franchisees have already signed up.”

Fuzzy Panda highlight that they “are not lawyers, this isn't legal advice, and we have 0 financial interest in this legal case. We just hope that the franchisees who were lied to and mislead by Geisler and Xponential can recover their lost retirement funds.”

About the author

Karen Sweaney

Co-founder and Editor, Australasian Leisure Management

Artist, geoscientist and specialist writer on the leisure industry, Karen Sweaney is Editor and co-founder of Australasian Leisure Management.

Based in Sydney, Australia, her specific areas of interest include the arts, entertainment, the environment, fitness, tourism and wellness.

She has degrees in Fine Arts from the University of Sydney and Geological Oceanography from UNSW.

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