Learn more about Hyperice, its newest acquisition of Core, and three significant implications it has for the company and the health-tech industry at large.
Who is Hyperice?:
Initially known for offering premium icing solutions for athletes, Hyperice has emerged as a dominant player in the recovery hardware space. Through aggressive product innovation, Hyperice has introduced a suite of tools that include the Hypervolt massager, Vyper vibrating foam roller, and Venom low-back heater, which have all become staples for high-performing athletes around the world. This comprehensive set of tools has led to Hyperice becoming the official recovery partner of the NFL, NBA, PGA, MLB, and UFC.
In an episode of the FITT Insider podcast, host Joe Vennare spoke with Hyperice CEO Jim Huether about his time at the company, how it became what it is today, and what its future might hold. Huether explained that the company is after the "Health Tech" category and noted that with its innovative and tech-driven approach to recovery, it intends on being the dominant company at the intersection of health, wellness, and training.
Before diving into its outlook for the future, let’s look at what Hyperice has done to arrive at its position today. To accelerate growth and expand its portfolio of products, in March 2020, Hyperice began its foray into acquisitions by announcing the purchase of Normatec, the maker of cutting-edge pneumatic compression boots that flush out athletes’ legs and arms after a hard workout. (It is a tool that I use regularly, so keep your eyes peeled for a review in the future.) In early 2021, Hyperice continued this strategy with the acquisition of RecoverX, a startup focused on heating and cooling technology.
Most recently, in July of 2021, Hyperice announced its acquisition of Core, a meditation wellness company that invented a first-of-its-kind meditation training device. To a casual observer, this acquisition might seem like just another addition to Hyperice’s product line, but I believe it signals a bigger move with significant implications for the "Health Tech" space.
What is Core?:
Core is a personalized meditation tool that uses dynamic vibrations and feedback to help you relax, focus, and stay consistent during your mindfulness efforts. The sphere-shaped device uses gentle vibrations to help you focus and guide your breathing, while ECG sensors collect pulse and heart rate variability (HRV) data to measure the benefits of each session on your body. Meditation is difficult to quantify, and a lack of apparent progress can frustrate beginners and cause them to stop trying altogether. Combined with the companion app, Core helps guide and motivate you on your meditation journey, allowing you to develop the mind-clearing skill more effectively using a method that a software-only solution can't compete with.
Implications of This Acquisition:
Physical Health & Mental Health
Yogis and warriors of past eras have long understood the importance of mental health and its inextricable tie to physical health, yet the western world has only recently started tuning into the connection. In 2021, this relationship was put into the spotlight on the world's biggest stage as former gymnastics all-around gold medalist Simone Biles resigned from the Olympics at the last minute, citing mental health issues. It demonstrated that even one of the most dominant athletes in the history of her sport didn't feel she could perform her best physically until she was also ready mentally.
By acquiring Core, Hyperice is making a profound statement as a leader in the health-tech space by acknowledging that recovery and readiness go beyond physical preparedness alone. It validates and draws attention to the critical role of mental health in the performance puzzle.
Hardware + Software
Hyperice produces an app software, but in my opinion, it is largely a gimmick that doesn't do much more than show you how to use the devices. Hardware has always been the backbone of the Hyperice business, and the company has accrued tremendous expertise designing and producing high-quality consumer devices at scale. While this has been a successful model for Hyperice thus far, it is clear from both a user experience perspective and a business valuation perspective that there is more to be desired in the marriage of software and hardware within the company. Competitors like Peloton and WHOOP have shown incredible success with this hybrid approach, and it’s no doubt that Hyperice has taken notice and wants a piece of the action.
Core's companion app will serve as the first subscription offering from Hyperice, helping it explore the synergies that hardware and software can provide to the user. In the process, the subscription model incentivizes Hyperice to continue improving the customer experience by delivering value, or else it will risk canceled subscriptions. Software-as-a-Service (SaaS) companies are in high demand from investors in the current market, and this should help bolster the balance sheet and continue to attract new investment. I hope we see more offerings of this style from Hyperice in the future as it works to extract more value from its existing products.
Competition from New Players
Although the acquisition of Core is positive news for the industry and for consumers, it may invite serious competition for Hyperice from leading mindfulness apps and corporate wellness providers. Accelerated by the impact of COVID-19 on mental health, the global meditation industry is expected to reach $9B by 2027, with companies like Calm and Headspace growing rapidly, fueled in part by their large corporate partnerships (i). There is little doubt these companies won't look to capitalize on their growth and partnerships by expanding their offerings to provide a more wholistic set of wellness tools. The acquisition of Core may have broken down the barrier between physical and mental wellness companies and initiated a new wave of competition as software companies try to apply their talent to the hardware side of the space.
Summary:
As a consumer and industry observer, I believe this acquisition was a great move by Hyperice that brings much needed attention to the interplay of physical and mental wellness. It expands the offerings within the Hyperice ecosystem and provides a new interface for the company to interact with its customers. Going forward, I am sure it will leverage its hardware expertise to accelerate innovation in this new category of meditation hardware, staying true to its mission of being at the intersection of health, wellness, and training.
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