Zwift, an online fitness platform for cyclists and runners, raised $450 million in a Series C funding round. The minority investment was led by KKR, a New York-based private equity firm. Following the investment, Zwift is now valued above $1 billion.
New investors in the round were Zone 5 Ventures (bike manufacturer Specialized’s venture capital fund), Permira, and the Amazon Alexa Fund, alongside previous investors True, Highland Europe, Novator, and Causeway Media.
Zwift previously raised $120 million in its Series B round (2018) and $27 million in its Series A round (2016).
Founded in 2015 and based in Long Beach, California, Zwift delivers a gameified, immersive experience for runners and cyclists through its app-based subscription service, which costs $15 per month. Compatible bike trainers and treadmills pair with the app to create an in-game avatar that can explore 240 miles of terrain in 10 virtual worlds. Users can also engage in a social experience through group rides and daily mass participation events.
Zwift has also hosted high-profile events such as the first Virtual Tour de France in July, which attracted 117,000 participants. 
The company currently has 2.5 million accounts registered across 190 countries.
Zwift’s fortunes have risen on the back of the current global pandemic, which has many consumers avoiding gyms and seeking out virtual methods of social interaction and engagement.
The hefty $450 million funding will allow the firm to further invest in its core software, while priming it for entry into the hardware market in order to provide a more streamlined and integrated offering. Specialized’s investment also represents the “beginning of a strategic partnership,” according to a release from Zwift. This could conceivably entail an arrangement to produce bike trainers for Zwift.
Eric Min, CEO and co-founder of Zwift, stated that the nearly half-billion-dollar investment will allow the firm to increase its headcount in its core products team. The company currently employs approximately 350 people.
Stephen Shanley, director at KKR, said, “Zwift is the preeminent digital brand for the global cycling community with a best-in-class product that sits at the intersection of digital health, gaming and at-home fitness. We see tremendous potential ahead as Zwift invests further in its digital and physical products to enhance the experience for its global community of enthusiastic users. This investment fits perfectly with our growth equity strategy of backing leading tech entrepreneurs as they scale globally.”
KKR has a long track record of supporting tech-focused growth companies, and has invested more than $2.7 billion in the area since 2014.
Management consulting firm OC&C advised KKR on its investment in Zwift. “We are delighted to have supported KKR on this transaction, building on a long-standing relationship with one of the world’s premier private equity investors. We bring extensive experience in personal fitness, gaming, and consumer internet to offer unique insight into this business,” OC&C said in statement on its website.
The London-based firm earlier this year advised KKR on its acquisition of The Citation Group, a UK provider of human resources and employment law services to SMEs.