Why this early Twitter investor invented a $1,500 rival to Peloton (that's not a bike)

Welcome to the at home gym craze, Liteboxer. Read More...

If early Twitter investor Todd Dagres is personally getting involved in the creation of a new venture, chances are high there is a large opportunity to be capitalized on in the years ahead.

Besides spotting Twitter as a hit in its infancy, Spark Capital founder Dagres has backed Mirror (recently sold to Lululemon), SmileDirectClub (went public in 2019), Postmates (just sold itself to Uber) and Oculus (bought by Facebook in 2014 for $2 billion) among many other home-runs with a consumer bent. Now the fitness focused Dagres could also call himself co-founder of Liteboxer, which takes aim the connected fitness craze that had become even crazier with COVID-19 shutting gyms down worldwide.

Debuted Tuesday exclusively by Dagres on Yahoo Finance, Liteboxer is a $1,495 connected boxing training machine. The portable at-home device uses a mix of LED lights, music and a built in tablet to deliver its full body workouts. A monthly subscription costs $29.

“It started because I was boxing training, and I loved the workout, but then I tried to emulate it at home and it just was a terrible experience. Punching the heavy bag was boring and tedious. Up until now it didn’t exist. I decided to build a product that would provide the same kind of sparring and training experience I had in the gym. So that’s the epiphany that I had,” Dagres explained of the development process.

BOSTON, MA - MARCH 6: Boston venture capitalist Todd Dagres. (Photo by David L. Ryan/The Boston Globe via Getty Images) — BOSTON, MA – MARCH 6: Boston venture capitalist Todd Dagres. (Photo by David L. Ryan/The Boston Globe via Getty Images)

Liteboxer has raised a total of $6 million in funding, backed by several big names such as Boston Celtics co-owner Jim Pallotta.

The timing of the launch couldn’t be more ideal.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Aforementioned gym closures because of COVID-19 — and the unknown on the timing of their re-openings — has sent valuations on at-home fitness brands into another orbit as people invest in personalized gyms. Peloton’s stock has skyrocketed 120% this year, giving it a market cap of $17.6 billion (per Yahoo Finance Premium data) despite its lack of profits. Lululemon just plunked down $500 billion to buy Mirror, which only has “tens of thousands” of users and not much history of profits.  ” data-reactid=”33″>Aforementioned gym closures because of COVID-19 — and the unknown on the timing of their re-openings — has sent valuations on at-home fitness brands into another orbit as people invest in personalized gyms. Peloton’s stock has skyrocketed 120% this year, giving it a market cap of $17.6 billion (per Yahoo Finance Premium data) despite its lack of profits. Lululemon just plunked down $500 billion to buy Mirror, which only has “tens of thousands” of users and not much history of profits.

“I think there’s a huge opportunity [in the market]. I mean, people aren’t going to be flocking back to gyms anytime soon. There are billions of dollars at play out there in the market. The availability of these new products and the fact that people are now having to exercise in their homes, it’s going to create a massive shift of spending to the home from what was gyms before. I think the opportunity is significant. As to the valuations, I like them. But it’s hard to tell if they can be sustained. I don’t know. I just think if you have a product with a sustainable competitive advantage in the fitness market, you have a massive opportunity,” Dagres adds.

<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.” data-reactid=”35″>Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.