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Money is moving into Asian fitness tech — but 2018 could be survival of the fittest

  • Asia's market for fitness-related technology is booming, and so are investments in the industry
  • The number of investment deals is declining however, even as the amount of money increases

Asia's fitness technology sector has attracted millions in funding — but fatigue may be kicking In.

A fitness tracker.

The continent is seeing a boom in apps, wearables and other tech that helps people stay in shape, and the industry has attracted millions of dollars in funding in recent years.

Buoyed by rising income levels and favorable government policy, residents from Guangzhou to Gurgaon have flocked to gyms and spinning classes in the past few years. A number of companies have mushroomed to serve the increased demand, and many have scored funding with little fuss.

"The proliferation of mobile, a burgeoning middle class, and pro-fitness government policies are enabling the rise of fitness tech in China and India," venture capital research firm CB Insights said in a recent report.

Consumers are spending a lot of money on these services, along with associated products, such as apparel and adjacent services such as nutrition.Anagha Hanumanteintelligence analyst, CB Insights

"For example, in June 2016, the Chinese State Council issued a plan to implement a national fitness strategy to improve the physical fitness and health levels of the entire country by 2020," the report said.

Similarly, India's National Skill Development Corporation is funding a K11 Academy of Fitness Sciences in North India, instructing young personal trainers, the report added.

As the sector matures, Asian companies have been punching above their weight. The region accounted for 30 percent of all investment deals in the fitness tech sector in the 10 months through October, up 10 percentage points from a year ago.

"Investors are realizing that there is a great opportunity to tap into the fitness category, because consumers are spending a lot of money on these services, along with associated products, such as apparel and adjacent services such as nutrition," said Anagha Hanumante, Intelligence Analyst at CB Insights.

More money, but fewer deals

But there are signs of fatigue kicking in. Overall investments in the sector will rise this year, but the money will be spread over fewer deals, suggesting investors are getting more selective with their bigger bets.

CB Insights data show more than 130 deals had taken place until October, driving more than $685 million dollars into the fitness tech sector globally. However, just two transactions — cycling start-up Peloton Interactive and on-demand workout app ClassPass — accounted for more than half of the overall pie.

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