Turnaround
VeloRide Studios, a 22-location indoor cycling chain in Colorado and Utah, lost money last year and its lender wants a 12-month plan to operating breakeven before it will refinance the debt.
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VeloRide Studios runs 22 indoor cycling studios (24 bikes each) across the Denver, Boulder and Salt Lake metro areas. Last year the chain booked $6.4M of revenue and an operating loss of $848K, its second loss year in a row. The lender has agreed to refinance only if management presents a credible plan to operating breakeven within 12 months; the board has put four of the weakest locations on the table for possible closure.
The pattern inside the portfolio is consistent. Mature studios opened before 2021 run near capacity at prime hours and make money. The 13 newer or weaker studios average only 8.0 riders per class against a 24-bike room, because the chain kept adding capacity through 2021 while rider demand spread across gyms, home bikes and running clubs. The class schedule is the same every weekday: 34 classes per week (about 148 per month), including a 6:00 AM block and a 9:00 PM block that often run with two or three riders and a full instructor fee.
You advise the board. The key decisions: what a typical weak studio must do to pay its own bills, which levers close the gap in 12 months, and which of the four weakest locations to close versus keep.
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