Hydrow, the Boston fitness-tech firm that sells a $2,495 rowing machine, laid off about 35 percent of its workforce this week as it faces challenges in the at-home workout market.
A spokesperson for Hydrow said the company had more than 200 employees, meaning at least 70 people were affected.
At-home fitness firms like Hydrow grew during the pandemic as people avoided gyms and group workout classes. But some of the excitement — which led to a 400 percent jump in sales for Hydrow in 2020 — is drying up.
Chief executive Bruce Smith said the layoff will allow Hydrow to lower costs and build a “sustained-growth business focused on profitability.”
“We will continue to invest in elements of the business that made us a market leader,” said Smith, who founded Hydrow in 2017, in an e-mailed statement. That includes Hydrow coaches, who lead its fitness classes, and workout content, he said.
A source with knowledge of the situation said Hydrow is expected to share more information about its new strategy with employees on Friday.
The layoffs come four months after the firm raised $54 million from investors. Hydrow said its revenue more than tripled from 2020 to 2021. Bloomberg reported in June of last year that the company was in talks to go public at a valuation of more than $1 billion.
Hydrow said it will “be in a very strong position when the IPO window opens again.”
Other at-home fitness companies have faced challenges this year, including Peloton Interactive Inc., which announced plans to replace its chief executive and cut 2,800 jobs in February due to a slowdown in demand. Tonal, which sells a wall-mounted workout device, cut 35 percent of its staff last week.
“The capital markets began to deteriorate faster than anyone anticipated,” Tonal chief executive Aly Orady wrote in a memo obtained by TechCrunch. “To make it through what’s ahead, we must prioritize becoming a self-sustaining and profitable business.”
The source with knowledge of the Hydrow layoff said it came as a surprise to employees. They said “the writing was on the wall” for firms like Peloton, which hired thousands of employees during the pandemic; Tonal, meanwhile, had increased its headcount to 750.
“[Hydrow] didn’t grow to the extent that other companies did,” they said.
Meanwhile, in an effort to widen its customer base, Hydrow released a new rowing machine two weeks ago, designed to address the barriers of size and cost that kept people from buying it. The original machine, which went on sale in 2019, costs $2,495 — not including the cost of a Hydrow membership — and the new machine is $1,000 cheaper.
(Hydrow offers a mode that allows people to use the machine at no additional cost but markets the $38-a-month membership as “an integral part” of the experience that “should not be considered an optional part of purchasing.”)
The new machine is also about 40 pounds lighter, so it can be shipped overnight with no scheduled delivery required.
Hydrow says it has more than 200,000 users, but it’s unclear how many people have purchased its rowing machine. Anyone can download Hydrow’s smartphone app and access workouts with a $20 per month subscription.