Home / Tech / This startup just got $17 million to take on Peloton. Here's why its founder thinks there's a big opportunity in the home fitness market.

This startup just got $17 million to take on Peloton. Here's why its founder thinks there's a big opportunity in the home fitness market.

Pivot CEO Moawia Eldeeb

  • Moawia Eldeeb is relaunching his fitness technology startup to focus on serving at-home users.
  • His company, now called Pivot, previously offered a kind of smart mirror that served as a virtual trainer in gyms.
  • This fall, the company will launch a new device for consumers that will stream live workouts to them and track them as they do weight and interval training.
  • Pivot just got $17 million in series A funding to launch its product.
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Moawia Eldeeb didn’t set out to take on Peloton.

An entrepreneur with a passion for fitness and a background in computer vision technology, Eldeep just wanted to help people get in shape.

He’d worked as a personal trainer while studying computer science at Columbia University. Using what they’d learned about computer vision, he and a classmate developed a smart mirror device that was designed to be a virtual trainer for people wanting to get in shape and formed a company called SmartSpot to make and market it.

Eldeeb sold SmartSpot’s devices to gyms, figuring that was the best way to reach the most number of people. But after initially embracing the devices, gyms started shunning them, because many of their best clients were cancelling their pricey in-person training session to work out in front of the SmartSpot mirror instead. The gyms figured that even if they might help more people, they’d end up losing money.

Eldeeb decided the company needed to pivot. He’d been wary of marketing a high-tech fitness device to people who worked out at home, because he figured the relatively high price tag would turn them off. But then Peloton’s pricey cycles started taking off with at-home exercisers, and Eldeeb figured it could work.

“If we can’t go to gyms, we have to go to people’s homes,” he told Business Insider.

Eldeeb is making a pivot to Pivot

So, Eldeeb is essentially relaunching his startup, refocusing it on the consumer market — and getting ready to vye with Peloton, not to mention other new in-home fitness technology products such as Mirror’s smart mirror.

This fall, his company, now called Pivot, plans to launch its new product — an in-home fitness device — and accompanying subscription service. To prepare for the launch, the company just raised $17 million in series-A funding, in a round led by DCM.

SmartSpot’s device was essentially a screen that had a built-in 3D camera. The screen showed a live video feed of users while at the same time tracking the exercises they were doing and the movement and angles of their body and joints. The device coached users on how to improve their workouts.

Pivot's in-home workout

Pivot’s new at home device will use much of the same technology, but the screen will stream live and recorded workouts from well-known trainers, Eldeeb said. Trainers will get alerts when Pivot users aren’t doing exercises from livestreamed classes properly, and they will be able to offer pointers in real time.

Unlike Peloton, whose live workouts are primarily focused on its stationary bike and treadmill, Pivot’s device and service will focus on weight and interval training. The company will sell the device with all the weights and other equipment users will need to participate in the workouts it will stream through its service. Eldeeb wanted to be able to offer at home consumers more than just another cardio machine and to help duplicate for them what they’d find in a fitness center.

“If you look at the whole gym, you have the cardio section, but then you have the rest of the whole gym area that people actually work out in,” he said. “For us,” he continued, “it’s about being able to offer everything else as a full body workout.”

Pivot learned from Peloton

Pivot is taking a few pages from Peloton, though. It plans to charge for its device around the same amount that Peloton does for its stationary bike, which starts at $2,245. It also plans to charge a monthly fee for its service that’s around the same price as the prominent tech fitness company, whose own service costs $39 a month.

Read this: Peloton, the fitness startup with a cultlike following, could go public at an $8 billion valuation. Insiders reveal why its business seems set to explode.

Peloton has made household names out of some of the trainers it offers through its service. For its part, Pivot plans to use some of its funding to hire already well-known trainers, the kinds that train Hollywood and other celebrities, Eldeeb said. It also plans to use some of its funds for research and development to allow it to offer users accurate advice and tips while they’re exercising, he said.

Although it took a while for Pivot to get to this point, and it faces a well-known and funded rival in Peloton, the latter has served as inspiration for Eldeeb to get into the home fitness market.

“Right now is definitely the right time,” he said.

SEE ALSO: This VC and his firm don’t focus on particular technologies or sectors. Instead, they look for startups with a kind of network potential. Here’s why.

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