Lucrative deals with celebrities such as David Beckham, Greg Norman and Cindy Crawford were key to F45’s aggressive US expansion. But they also cleaned out the company’s coffers.
Embattled Aussie fitness franchise F45 has had to overcome some significant hurdles in its rise to prominence and more recently, its fight for survival. And that includes multi-million dollar payments to the celebrities who were brought in to turbocharge its now-abandoned global expansion plans.underpinning its franchise sales. The update also revealed the company’s plans to slash staff and downgrade earnings and revenue forecasts for this year.
As its subsequent accounts have shown, cash was a better deal for those celebrities who took the money rather than wait for stock deals that were linked to F45’s market valuation which began shrinking soon after its initial public offering.Johnson opted for a cash payment of $US4 million rather than F45 shares, after the successful IPO.
This week, F45 revealed that 300 franchise sales have been cancelled due to the lack of funding and another 300 are in serious doubt. The most lucrative celebrity endorsement deal belonged to Wahlberg, a fitness fanatic who owns several F45 studios and is a board member of the fitness group as well as owning shares in the business.He received 2.74 million share rights which vested with the IPO at a valuation of just under $US44 million. The downside for Wahlberg was that he did not receive the stock until March this year when shares had already begun their slide.
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