Brisbane-headquartered boxing franchise 12RND is set to move up a weight class or two after securing a master franchise licensing agreement for the UK and Ireland with Empowered Brands, the owner of énergie Fitness whose backers have committed £50 million (AUD$93 million) to roll out 250 clubs within five years.
This compares to the current reach of 92 gyms for 12RND and its sister brand UBX (pronounced 'You-Box') across Australia, New Zealand and Singapore.
Co-founded in 2016 by tech entrepreneur Tim West and four-time world champion boxer Danny Green, UBX will be introduced to the two countries with longer-term plans to open 450 gyms.
"We set out to democratise boxing. Our success has come from our ability to rethink boxing and rethink group fitness in a way that gives members access to a unique mix of boxing and strength training in an ultra-flexible format that removes class timetables and bookings altogether," explains West, who was also an early investor in edtech unicorn Go1.
"We always say boxing is the world’s largest niche. It’s a very large niche and yet it hasn’t scaled to its potential anywhere in the world," he says.
"Empowered Brands saw us as the fastest growing and strongest boxing provider globally, and decided they’d like to take a master franchise license for us starting with the UK and Republic of Ireland."
He says the deal came about after the 12RND's UK-based director Dan Burke set up an introduction with Empowered Brands' backer RM Funds, which then introduced 12RND to the team at énergie Fitness - an enterprise that has 100 franchised fitness clubs operating across the UK, Spain and Bahrain.
RM Funds, an alternative asset management business founded in 2010, has pledged to invest £50 million to open the 250 clubs.
"In order to grow in a new region you need to have a great product, you need to have support structure and infrastructure, and you need to make funding available to franchisees in regions, and that’s the real formula that this deal brings," West says.
"It hits all of those three criteria and so it provides all of the ingredients required to really grow at an accelerated rate."
West highlights plans to also springboard into mainland Europe in the future, although the next expansion for UBX will be into the US market.
"Strategically, the Empowered Brands partnership makes sense and fits in perfectly with our European plans, they have a successful network across the UK and Republic of Ireland along with parts of Continental Europe," he says.
"For us it made sense to partner with someone who already has the infrastructure and experience and has a successful business in that region.
"In a real sign of the times, the deal was done almost entirely though video conferencing so we are looking forward to meeting the team face-to-face this year."
The group had already been planning an expansion into the UK for some time, having secured a lease in Twickenham Train Station in London in late 2019 - a moment when leases were also being negotiated in southern California before the outbreak of the pandemic.
"We'd fully intended to enter the UK ourselves. The UK and Ireland have a long and proud history of boxing, it’s a cultural fit with their markets, and this partnership will really fast-track and accelerate that growth," he says.
West emphasises there is still plenty of room for growth in Australia as well, where network club member numbers grew by 41 per cent in 2019, and rose by around 14 per cent annually in 2020 and 2021 despite the effects of lockdowns.
"The plan was to be planning for scale and for growth. We don’t think the Australian market is plateauing yet, it’s probably 50 per cent through its growth cycle. In fact, we think we probably would have reached that growth endpoint had COVID not arrived," West notes.
"Revenue yield per club has not only been maintained but increased during COVID affected periods, with overall network revenue increasing by an average of 21 per cent per annum over 2020 and 2021.
"Our ability to not only survive but grow during the COVID lockdowns proves the resilience of the model, we invested heavily in our team and technology and we are now primed for growth."
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