Dive Brief:
- Virgin Pulse has been on a shopping spree, signaling a growing wave of consolidation in the crowded corporate wellness space, according to Workforce.com
- In a news release from earlier this year, Virgin Pulse announced it would acquire two competitors, Providence, R.I.,-based ShapeUp and Global Corporate Challenge, based in Melbourne, Australia.
- Together, the three companies will serve 6,500 customers in 185 countries, greatly expanding the reach of Virgin Pulse, a wellness and engagement company that is part of Richard Branson’s Virgin Group. Financial details of the deals were not disclosed, reports Workforce, but the move is a major deal in this nascent space, according to industry analysts.
Dive Insight:
Danna Korn, CEO of Sonic Boom Wellness, a corporate wellness program based in Carlsbad, Calif., told Workforce that it could just be the start of such deals, predicting that 2016 “will be a big year” for wellness M&A activity. “This is the first in a huge wave of these kinds of occurrences, and it’s going to continue to happen,” she told Workforce. “Companies will either get gobbled up or go out of business.”
Mike Thompson, president and CEO of the National Business Coalition on Health, told Workforce that attrition is inevitable. “The whole wellness arena is entirely fragmented,” Thompson said. “There are literally hundreds of players, and it’s not clear that many have distinguished themselves from the pack. It’s like the wild, Wild West.”
LuAnn Heinen, vice president at the National Business Group on Health, told Workforce that the large employer market is increasingly global and needs "scalable wellness platforms and solutions that can be adapted beyond the U.S.." If there is successful integration of the companies, each of which had its own successful platform, that could benefit large employers.
She added that the abundance of wellness startups also means a steady supply of niche solutions for employers to try out in tricky, emerging areas such as diabetes prevention, nutrition, sleep and resilience.