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The size of the investment and terms of the transaction weren't disclosed, though Snap said TZP will become the second-largest stakeholder in the company after founder and CEO Peter Taunton.
"This new investment positions us to build on the dramatic success we have enjoyed over the last few years," Taunton said in a statement.
The TZP fund is buying the stake from Snap's previous biggest outside investor, Boston-based Summit Partners, which had a fund that took a stake in Snap in 2008 with a strategy to exit in five years. Summit more than doubled its investment after a sales process that attracted major investment banks as well as dozens of private investment firms, said Steele Smiley, a Snap marketing executive.
"This was a significant opportunity for us to find the right partner," Smiley said. "Our vision is to take the company from its size today to double that in next five years."
Snap Fitness has about 2,000 health clubs in 15 countries, about 15 percent of which are company-owned. The rest are owned and run by franchisees. The combined revenue of the system is about $500 million, up from $100 million when Summit first invested, Smiley said.
Smiley, who is the founder of the Steele Fitness firm that Snap bought last year and operates as a separate brand, said a public listing for Snap is "very possible" in the future, though the company has no immediate plans.
Snap is the first investment for a new fund from TZP, a New York-based private equity firm with more than $500 million under management. According to its website, TZP's approach is to be the investment "partner of choice" and prefers to work with companies that are still led by their founder-owners.
Evan Ramstad · 612-673-4241