Fitness startup Tonal may raise funding at a valuation between $200M to $300M, representing a 90% drop over its $1.6B valuation from its last fundraising.
The startup is reportedly facing a cash crunch after failing to secure a
buyer. Existing backer private equity firm L Catterton is reportedly
set to lead a $125M funding round.
- The
equity stakes of current shareholders would be significantly diluted as
a result of the dramatic decline in valuation during the "cram-down"
fundraising.
- The stakes of the smaller shareholders will be effectively wiped out.
- However, the firm is in critical need of funding to continue operations.
- Tonal had received a term sheet from other investors a few weeks ago, which they rescinded later on.
- Since its founding in 2016, the firm has raised $520M in total funding to date.
- Existing backer Dragoneer Investment Group declined to lead the funding round.
