Member Article

Embattled Fitbug turns to crowdfunding as it continues B2B turnaround

Fitness tech firm Fitbug is to offer investors the chance to participate in a £2.6m fundraise as it looks to continue its realignment from the consumer market to B2B sales.

Investors on equity crowdfunding platform SyndicateRoom will have have the chance to invest up to £1.76m in the AIM-quoted digital wellness business, which has already raised £852k through institutional investors.

The Cambridge-based crowdfunding platform will be the sole retail distribution agent for the fundraise which will see investors offered Enterprise Investment Scheme shares on the same terms as institutional investors.

Fitbug has recently embarked on a major realignment of its business after struggling in the consumer wearables market leading to pretax losses of £6.3m earlier this year.

Under the stewardship of Chief Executive Anna Gudmundson, who was appointed in August 2015, the digital firm has focused its attentions on the corporate wellness and B2B market as it hopes to turn around its fortunes.

The potential market for corporate wellness products is predicted to be worth billions thanks to its potential to increase productivity and reduce absenteeism, with a growth of 8.4% per year over the next 5 years to $12.1 billion in the US alone.

Fitbug’s new funding drive will help it more aggressively corner this market and build upon its Q1 B2B sales of £400k and current potential pipeline of £1.1m.

Anna Gudmundson commented that SyndicateRoom’s membership of the London Stock Exchange made it a particularly enticing proposition.

She said: “Having assessed a range of finance options to support our short-term and long-term working capital needs, we were particularly excited by the prospect of offering new shares to investors via SyndicateRoom.

SyndicateRoom is the only crowdfunding platform to have intermediary status with the London Stock Exchange which, the firm says, means it is the only alternative investing platform that gives retail investors access to public and private shares.

Anna added: “With its recent membership of the London Stock Exchange, SyndicateRoom is the only platform that could effectively distribute our shares direct to crowdfund investors, enabling us to expand the number of owner-advocates for our business as we focus on becoming a leader within this space by delivering an innovative app-based technology to enhance employee wellness.”