Performance technology company Hyperice has completed a Series A funding round for $48 million, which puts the firm at a $700 million valuation, CEO Jim Huether told CNBC this week.
The funding round includes a list of prominent athlete-investors, including National Basketball Association stars Anthony Davis, Chris Paul, Russell Westbrook, DeAndre Jordan and new Philadelphia 76ers coach Doc Rivers.Tennis star Naomi Osaka, who won the 2020 U.S. Open, is also an investor.
The company did not disclose the stakes each athletes took in the company, or the amount of their investments.
The company specializes in performance recovery products including its Hypervolt massagers which targets soft tissue pain and muscle recovery. In its new sponsorship deal with the NBA, the massagers now sit under the seats of each player during games.
Hyperice has gained popularity among athletes including Mahomes, who has used the firms since his days at Texas Tech University.
Added Osaka: “Since I’ve started using Hyperice, I’ve realized how crucial recovery is to getting the most out of my training and preparing my body for competition. Hyperice has improved my body and overall health and I know will be fundamental to having a long and healthy career, which is why I invested and want to use my platform to encourage every athlete to take recovery seriously.”
In an interview with CNBC on Tuesday, Huether called the Series A “one of the most high profile rounds in health tech” adding the company only sought $30 million but oversubscribed. The NBA and National Football League also joined the company as investors.
“The athletes and the leagues have certainly helped us tremendously to authenticate and validate the technology and help amplify it and help create more reach so that people know the benefits of the technology,” Huether said.
The Series A round was led by investment advisory firm Main Street Advisors and private equity firm S.C.Holdings.
Hyperice said it would use the funds to expand its artificial intelligence capabilities to enhance its new HyperSmart technology and app. The company also added Kansas City Chiefs quarterback Patrick Mahomes as an equity partner last week and will utilize Mahomes’ name and image to expand globally.
Other NFL players who joined this funding round include J.J. Watt, Jarvis Landry and Christian Mccaffrey.
In an email to CNBC, Mahomes praised Hyperice’s innovation of “new gear and tech” adding the company has “a huge opportunity to grow the customer base well beyond the pros.”
Hyperice will use funds from its $48 million Series A to enhance its its new bluetooth and artificial intelligence platform, HyperSmart app.
In March, the company acquired NormaTec’s compression system, which helps athletes with muscle tissue recovery. “Now that Hyperice and NormaTec are one, there’s no doubt they’re the recovery technology category leader,” Mahomes said.
Huether, who said the company generated $100 million in revenue in 2019, said Hyperice is projecting revenue “well over $200 million this year.” The company wants to gain more market share in a sports technology marketplace projected to be worth $30 billion by 2024.
Hyperice products are available at retailers, including Nordstrom and Bloomingdale’s. Huether said, “one of the expansion points is looking at international retailers” in Europe, Asia and Australia “on more of the consumer electronics side.”
Asked if Hyperice plans to pursue an IPO, Huether didn’t rule out the option but noted Hyperice “has been highly profitable” and currently isn’t planning to solicit more funding.
“We’re going to continue to advance our position internationally, continue to push our technology, build out our software capabilities, bring out products, and I think we’ll have a lot of options,” he said. “We want this to be a multi-billion dollar company within the next three to five years.”
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