In Business: finance for fitness
PureGym has been one of the British business success stories of the last decade, growing from a Leeds-based startup into the UK’s largest gym and fitness operator, with over 260 sites and more than a million members. We hear how Barclays has provided the partnership and finance to support them every step of the way.
”I think it would be very fair to describe the relationship between Barclays and PureGym as a partnership,” says Humphrey Cobbold, CEO of the fitness and leisure group.
That partnership launched in 2010, when the Leeds-based startup was supported by Barclays with growth finance as it began to acquire more sites for its low-cost gym operator model. Since then, acquisitions of LA Fitness and Soho Gyms have seen the company become the market’s dominant player, with plans for further growth and international expansion.
Cobbold says the company’s founding idea is of low cost fitness “to inspire a healthier nation”, adding: “Barclays have been one of the constant sources of support for PureGym.”
Supporting the fitness firm through its transformation from disruptor to market-leader has been Barclays Relationship Director, Mike Delay, who says he takes “personal pride in supporting the business from six sites to over 260 sites today”.
Citing the importance of Barclays’ relationship approach, Cobbold says: “Mike has been a pretty constant feature of the relationship throughout the time, and that’s enormously important because we’ve got an individual there with great embedded knowledge and understanding of how the business works.”
This has allowed Delay to be a sounding board for the PureGym business – helping it to expand and become a significant employer in local communities across Britain. Alex Wood, PureGym’s Chief Financial Officer, says: “I’d describe the relationship with Barclays as incredibly supportive and collaborative. One of the key benefits of Barclays as a bank is that it has a full service offering, and you always feel like you’re getting through to the experts when you need them.”
One of the key benefits of Barclays as a bank is that it has a full service offering, and you always feel like you’re getting through to the experts when you need them.
Wood says that PureGym plans to double the size of the business over the next three years – “and of course that needs funding”. “In terms of innovation,” says Cobbold, “Barclays have been tremendously supportive. They’re always there to guide us on trends that they can see happening in the market, but when we come up with ideas, they’re also there to fund and support us in making them happen.”
Fit for purpose
‘Making it happen’ has seen Delay support PureGym through multiple financings, and ultimately introduce the company to colleagues from across Barclays to help access a deeper pool of funds through the high yield bond market. He sees Barclays support as threefold: “One, the financing of the roll out and the growth strategy of the business over the years. Secondly, the core cash management and payments through direct debits and credit cards. And third, our sector involvement and expertise in the hospitality and leisure sector.”
Lawrence Gaston-Chaney, Director, Debt Finance at Barclays, adds: “As PureGym has grown, so has our financing support for them and at times we've partnered with alternate providers of capital to create a financing package that's truly fit for purpose. Where we've really enjoyed working with PureGym is being side by side with them along that journey. Knowing their business model, knowing what their strategic objectives are and partnering with them to ensure we've got the right financing in place to back them every step.”
In terms of innovation, Barclays have been tremendously supportive. They’re always there to guide us on trends that they can see happening in the market, but when we come up with ideas, they’re also there to fund and support us in making them happen.
The next step for the company is international growth, underlined by the announced £350m acquisition of European gym chain Fitness World, making PureGym the second largest sector company in Europe. “As PureGym moves internationally,” says Gaston-Chaney, “Barclays are uniquely positioned to support them. We have a global footprint, we have access to private and capital markets, and we can work with them to put together the right financing package wherever it takes them.”