Zwift raises $450 Million; Specialized joins KKR in the investment round

In a separate post of Peloton’s Q4’20 quarterly and 2020 annual results, Forum users discussed the implications to TrainerRoad. While viewpoints were mixed as to whether Peloton represented a threat to TR’s existing business and/or acquisition of new customers, Zwift was mentioned several times as a more serious threat to TrainerRoad. Perhaps today’s announcement will expand that discussion.

Zwift’s two stated objectives of the investment, include:

  • Accelerate the development of Zwift’s core software platform
  • Bring Zwift-designed hardware to market

In addition to the size of the investment bringing the total outside investment to $620 million, a couple of notable items were mentioned in the release

  • Specialized’s investment in Zwift (see Chris Yu, head of the Specialized Win-Tunnel, comments)
  • 2.5 million Zwift accounts in 190 countries opened since 2015 (probably 1.0 to 1.5M current customers)

I believe the potential implications of Peloton and Zwift to TrainerRoad’s business are quite significant, particularly over the long term. Prior to providing my own commentary, I would be interested to hearing other Forum user views.

I’m optimistic that we’ll finally get a lap button.

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… and not have to use a keyboard to be social.

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Have you play video games online before?
This would be a terrible mistake.

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How many threads do you feel you need to make your point?

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This is a real threat to TR to certain degree.
At the end, most people on TR had the option of Zwift or TR (similar pricing).
Those who chose TR was because they like what they have to offer better.
So on that front i think, people who already signed in with TR and locked their rate, will probably stay with TR.
New users is a whole 'nother game. TR is really in disadvantage.

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Discord? Thats what our Zwift club rides use to talk smack, and all the kids I’ve seen playing Minecraft or adults playing Halo or what not are using Discord or similar to actually talk during the game.

Not necessarily, future products will Influence that to a greater degree.

This money, means zwift have more of a resource to create those products - it’s how you use that resource that makes the difference. Zwifts record so far hasn’t been great, but on the flip side no one can surely say they haven’t taken a major foothold in the at home cycling market.

TR have to be smarter and more in tune with users to get ahead if they are not getting massive influx’s of cash/resource.

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What else am I supposed to use to pay respects?

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My point was how much BS goes with people talking on games.
I usually mute everyone when playing online games.

It feels that zwift allowing anyone talking to anyone would be a terrible mistake…specially on races.

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If Zwift is smart in regards to voice, they will offer a range of options of allowing voice among:

  • Friends
  • Teams/Clubs
  • Close Proximity
  • and likely other options that are already well used in the other MMORPG and similar game systems. They don’t need to invent the wheel, just look at and implement the smart choices already present.

And yes, a range of mute options should be part of that package as well :stuck_out_tongue:

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Better emotes would be a vastly superior and much more cost effective way for communication than audio, especially given the language challenge.

This is a solved problem in basically all online games (League of Legends, Clash Royale, Fortnite) so they can and should just copy those solutions.

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I know you’re being sarcastic, otherwise I’d comment on your naivety lol

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That would be good, but I’m still of the opinion that integrated audio for group rides is the right way to provide social interaction with people that you normally ride with but can’t due to weather, pandemics, etc.

And can they finally get rid of the box of crayons used to color things?

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TR’s code isn’t going anywhere and Nate gives every appearance of somebody who’s going to keep this thing going even it’s just him alone in his basement. So, no matter what Zwift does TR’s not going out of business.

It would be interesting to know what the internal ownership structure of TR is. Who else besides Nate has ownership interest? I would imagine Chad has a decent minority stake. Those minority owners are leaving a lot of money on the table by not being able to cash out now by selling a portion of the company or all of it.

Things could get tense if they’re not already.

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I imagine Zwift is 100% focused on Peloton as a competitor and model to emulate. It is VC driven and investors want in on Peloton’s success (IPO opened at $27 on NASDAQ, at $83 today). I wonder if a Peloton or Zwift (maybe Zwift) board meeting has ever discussed Trainerroad except maybe as a dot on some sort of visual market map.

Trainerroad will be fine as long as they focus on their “sweet spot”, the serious data driven athlete. Peloton and Zwift will chase the mass “lifestyle” fitness market. They kind of have to grow like nuts to justify all that VC investment. I recently bought a kickr and trialed all the software. Zwift doesn’t deliver on workouts and training plans like Trainerroad. But I see Zwift as complementary to Trainerroad for social, breaking up solo structured training with virtual group rides during winter and as an alternative distraction during long workouts to podcasts, music, videos, etc.

Maybe Peloton or Zwift will buy out Trainerroad as a differentiator vs. the other and Nate can cash in!

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Maybe the $450m is so they can come knocking on the TR door in Reno with a check for $250m to buy Nate out and get Chad’s plans onto Zwift … At least I’d get the AppleTV TR app I want.

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That would definitely be the end of TR - Chad would say yes, Nate would say no and they’d be duking out in the parking lot and eventually court.

I dunno, I still think they are all offering different products for people with different interests. For me, TrainerRoad is more of a coaching service rather than just a trainer program. I think Zwift and Peloton have a much bigger overlap in the Venn Diagram of users. TrainerRoad has their nitch and they know how to use it. I think they probably have a lot more quality data on training plans, user ftp increases, etc. vs Peloton where people are often doing one-off classes and Zwift has lots of people doing free-rides.

I think it’s great that Zwift is fundraising well and trying to get better and I think the more people that are active (whether it be TR, Zwift, or Peloton) the better. That said, I like TR more than Zwift and plan on staying here as long as TR is around.

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Honestly I think TR is too small for zwift to care :slight_smile: and I assume many of people form TR are already on zwift. Zwift is willing to bring couch people to cycling because it is where business is (volume is always a key - like peoloton which burns money like crazy) - not with people already interested in cycling. TR has quite a “niche” userbase in terms of psychological profile and is based more on recommendations from existing users. Think of Zwift as a big, corporate food manufacturer and TR as a artesian bakery - they can easily coexist, they sometimes share clients database and most of the people will buy from big manufacturer - no matter what. Or rather to use more cycling base metaphore - it is Giant vs Festka or something similar.

I love the TR for the community and personal touch and involvement from Nate and Team and they will have they own new customers - I am sure.

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