ParkBox (公园盒子) recently announced that it has closed its Series A+ financing round, led by Huazhu Hotels Group, China’s leading hotel operator. This is the 4th time that ParkBox has received venture capital since its foundation in 2015.
With the help of the investment, ParkBox will not only develop more fitness pods of various outlooks, but also expand its location from community scenes to hotel scenes, including 500 hotel projects planned by Huazhu Hotels Group in the next 2 years.
ParkBox was first launched in 2015. When interviewed by Chinese biztech media 36Kr, HUANG Xiaolei, co-founder and chief executive of the company, said that “there are 3 indispensable qualities of mini gyms: convenience, covenant-lite access, and multi-incentive.
According to 2016-2017 China Fitness Industry White Paper published by Beijing Qingcheng Information Technology, the proportion of people who attend physical exercise in China is only 0.79%, far beneath America’s 17.82%. There are obviously more rooms for China fitness industry.
In comparison with other operators, ParkBox currently runs gyms of 3 sizes: 8 sq. m., 18 sq. m. and 28 sq. m. to satisfy the needs of accompany exercise. Besides, with the help of “Yuehe”, a system through which online users can learn from each other, bodybuilding talents can offer help to those who are currently ignorant in work-out, fostering their mutual encouragement.
ParkBox covers mainly the range of dormitory suburbs, gardens and white-collar apartments, which allows them to get closely attached to users.
The mini gyms are filled with fitness equipment such as treadmills, dumbbells and AI intelligent coaches. AI intelligent coaches are systems that could test the accuracy of movements by tracking users.
As for business model, apart from charging by hour, ParkBox imitates what COSTCO, the American retailer, has applied. When an individual pays his 99 yuan (around 15 dollars) membership fee, every hour in the gym costs just 10 yuan. (Non-members have to pay 29 yuan per hour). On top of that, members can purchase peripheral products and value-added services at favorable prices.
ParkBox now operates over 50 mini gyms across Shanghai and is starting to expand to Hangzhou. According to HUANG Xiaolei, each user visits these gyms an average of 6 times per month, with a retention rate of 25% in March. The first mini gym started in the previous June has already recovered its initial capital outlay and made profits. It is predicted that those newly built this year would get the money back within 8 months.
The core team members of ParkBox come from companies such as Mobike, Shanda Media Group, P&G, Microsoft, and Ford. HUANG Xiaolei herself has worked in multi-national consumer goods corporation P&G in charge of marketing and operation, and once tried to set up her own business in Silicon Valley.