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Aussie tech partners with UFC Gym and builds global MMA marketplace

There’s an innovative, fast-growing company working to add value to a large global sector that is in desperate need of innovation.
There’s an innovative, fast-growing company working to add value to a large global sector that is in desperate need of innovation. Alta’s platform is designed to capture and curate consumer demand for one of the world’s fastest growing sports, mixed martial arts (MMA), and drive it to local MMA/combat sports gyms in order to monetise fandom and interest through participation in sport and fitness.  They believe they have created a world class instruction and training programs with Co-Founder John Kavanagh, longtime head coach to MMA superstar, Conor McGregor. Alta’s programming has been proven in markets throughout North America, Western Europe and Oceania with over 15,000 people completing their signature training offering. They’ve also partnered exclusively with two division UFC champion Daniel Cormier, coach of multiple UFC champions, Eugene Bareman and former MMA athlete and star UFC broadcaster, Laura Sanko. MMA is considered one of the world’s fastest growing sports in financial terms, and has laid claim to being the globe’s third largest fan base of around 550 million people. The UFC has experienced rapid growth, and was estimated to be generating over US$1 billion revenue for the year to 31 March  2022. Alta estimates that more than US$8 billion in the US is spent on training for combat sports annually. IBIS estimates there are 39,000 martial arts gyms in the US alone, and it is estimated that there are over 100,000 martial arts/combat sports gyms around the world. Most of these gyms are individually owned, with very few franchise models. They have minimal online presence, inconsistent programs and infrastructure that is being underutilised. It is here that Alta believes they offer value to these gyms, providing them with refined consumer friendly programs, instructor training, and most importantly, new customers. As it stands right now, the company has a large backlog of gyms wanting to join their network, and is working hard to roll out to all of them as fast as possible. Join Alta’s Founder and Co-CEO Nick Langton and Co-CEO Angus Benbow this Friday, 2nd December at 11am (AEDT) for a live investor briefing for a wholesale opportunity to invest with exposure in a tech platform disrupting a $8 billion USA combat sports industry. Click here to book your spot or request the replay.  Alta believes the power of their global gym marketplace is not to be underestimated, its functionality and utility is top notch. Their newly developed tech stack enables Alta to track and optimise participant acquisition from all channels. There are a variety of fully integrated systems including payment processing, CRM, content management, commerce engine and member management. Alta began life in 2017 licensing its proprietary programming to MMA and combat sports gyms, where it built deep sector credibility with its gym partners by delivering what Alta considers are their premium customers and revenue, whilst streamlining onboarding and payments systems.  The next evolution of the company commenced when it began to aggregate a large, but fragmented industry, through its technology marketplace by connecting customers with gyms. An important part of how the company drives customers to gyms is through the content published through the Alta platform, which allows users to have an ‘In-Gym’ experience at home. To make sure this is as authentic as possible, they have recruited the biggest names in MMA to provide exclusive training and fitness masterclass content delivered online.  Daniel Cormier, John Kavanagh, Laura Sanko and many other famous MMA coaches and athletes will be exclusively creating content in a Chris Hemsworth’s Centr App styled operation, which importantly links the “in gym” and “at home” training experience making it a fully immersive fitness and training offering. Centr was worth US$200 million, after reaching an estimated 200,000 subscribers.

The model

The company operates a highly scalable model with extremely low capex requirements. One of their greatest advantages is they don’t take any risk in setting up premises or securing expensive long term franchise agreements, drastically reducing the possibility of an F45 style implosion. Alta prefers to refer to themselves as the ClassPass of combat sports – a company that had been valued at over US$1 billion before the pandemic and was acquired by Mindbody late last year. Alta’s flagship offering is their 20-week program, and it has built a global reputation for delivering deeply transformational experiences for its participants. In fact, circa 150 people have memorialised their training journey with an Alta tattoo after completing the program, which exhibits true customer evangelism. Alta’s signature program is summarised here: They also offer 10 week and 5 week programs, as well as the ‘Alta Membership’ – which emulates the convenience of ‘ClassPass’ by providing access to regular classes at your local martial arts gym without any longer-term commitment or the hassle of onboarding at individual locations.  Their scalability is expected to be in full swing under their new partnership with UFC Fit gyms, which have agreed to exclusively run Alta’s programming across their existing 200 global locations. This is a milestone partnership for Alta with the UFC being one of the biggest brands in sport. Further, it underwrites a large part of future growth as UFC Gym group has an additional 800 locations in development.  Click here to hear directly from Alta’s Founder and Co-CEO Nick Langton and Co-CEO Angus Benbow in a live investor briefing this Friday, 2nd December at 11am (AEDT).

Growth story

Despite being hampered by COVID, the company has managed to achieve a lot. They are on track to add 32 gyms into their network in FY23, bringing the total to 163. Of these, 64 will have been activated that are forecast to generate $5.56 million in revenue. This implies a 39.26% activation rate.  The company forecasts having at least 550 gyms onboarded by FY26. Of these, 523 are forecast to be activated, expecting to generate $57.1 million in revenue ($60.1 million including Aggregator revenue). In 2025, there are forecast to be 67,000 Martial Arts gyms in the US alone, with well over 100,000 globally expected. The company’s gym growth forecasts for running in-gym programs remain addressing less than 1% of the expected global addressable market. Alta considers that the majority of the revenue split in FY23 is from in-gym Alta programs, with this remaining at greater than 90% forecast through to FY25 with the growth of the Alta aggregator (class pass model for combat sports gyms) seeing increasing growth.  The Alta gym aggregator provides an accelerated growth opportunity due to no other combat sports gym marketplace currently available. Alta believes that with a Total Addressable Market in the US in 2025 of circa 70,000 martial arts gyms, even at a penetration of 4,000 gyms on the aggregator and only 10 customers per gym, this would be forecast to generate $100 million in gross membership revenue. These estimates may be providing $20 million net revenue with little additional cost due to the low capex scale of the business. 

Top-notch management and backers

Alta has a seasoned management team leading the company. Founder and co-CEO Nick Langton spent over two decades as a financial services operative, leading Private Wealth at Perpetual. Angus Benbow, also co-CEO, has held senior positions at NewsCorp and Perpetual, as well as leading a successful turnaround while CEO of ASX listed Centrepoint Alliance. Alta’s list of backers is a who’s who of Australian investing. On the high net worth individual side, this includes Goldman Sachs former Managing Director Chris Champion, Barrenjoey founding partner Sean Larcombe, Origin Energy CEO Frank Calabria, former Foxtel CEO Richard Freudenstein and Yellow Brick Road founder Mark Bouris. Importantly, Alta’s non Executive Directors, Hugh Williams and Vaughn Taylor are former family office CIO’s and significant investors in the business. On the institutional side, Lucerne Investment Partners are cornerstoning this round which follows on their initial investment. Other institutional investors include NewsCorp, Shaw & Partners, Altor Capital, Apex Capital, VP Capital, Sentor Investments and Barry Smorgon’s Sandbar Investments. . Join us for a live investor briefing where we will discuss how Alta’s tech platform is backed by the who’s who of Australian investing. Click here to book your spot or to request the replay.  Reach Markets have been engaged by Alta Global Group Ltd including managing this offer and may receive fees for its services. Past performance is not a reliable indicator of future performance.
Sources:     

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