In September 2019, Gilad Jacobs, the CEO of Normatec, a maker of devices that help athletes recover from injuries, and Anthony Katz, founder of a similar company called Hyperice, had their usual weekly chat about business trends and trends. latest technologies in their industry when they both paused, realizing at the same time that they were having the wrong discussion.
“Literally,” said Jacobs Forbes“Almost at the same time, we were like, ‘What are we doing? What do you think of this? Do you want to explore what this would look like?’
The new topic: how Hyperice could acquire Normatec and its $1,700 air compression leg recovery device, used by top athletes like LeBron James and Kevin Durant, and make it more accessible to the consumer of all days.
“We just started talking and it all took off from there,” Jacobs said.
More than two years after the approximately 100 million dollars acquisition in 2020, Hyperice unveils what it calls the “first of its kind” device, the Normatec Go, a mobile version of air compression technology that will cost $399. It’s cheaper than the larger, stationary Normatec 3, which costs around $800.
Hyperice CEO Jim Huether said Forbes that Normatec Go targets the same calf muscle recovery and is more convenient.
“It’s going to be a pretty big move,” Huether said. “We always say we aspire to be a combination of Tesla, Apple and Dyson. And then,” he added, “with a little mix of Nike, Adidas.”
Hyperice nears $1 billion
Irvine, Calif.-based Hyperice, launched in 2012, specializes in devices that help athletes recover from injury faster. Its products include percussive massagers, vibrating rollers, and cooling and heating pads. Hyperice estimates it’s worth $850 million after a $40 million funding round in 2021. That’s up from a valuation of $700 million the year before, when it raised $48 million. dollars. huether said Forbes that revenue has tripled since 2019, when Hyperice earned around $100 million, according to Pitchbook. That’s up from $10.6 million in 2017.
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Athletes who have invested in Hyperice include tennis star Naomi Osaka, Kansas City Chiefs quarterback Patrick Mahomes, Chris Paul of the Phoenix Suns and Ja Morant of the Memphis Grizzlies.
Normatec was founded in 1998 by Jacobs’ mother, Dr. Laura F. Jacobs, who served as Chief of Physical Medicine and Rehabilitation at Cooper University Hospital in Camden, New Jersey. She developed the device to help breast cancer patients with poor blood circulation after surgery. Air compression devices are often wrapped around a patient’s calf after surgery to prevent pulmonary embolism or blood clots traveling to the lungs from the leg. It was a condition that ended the career of National Basketball Association Hall of Famer Chris Bosh after the 2016 season.
“Most people only think of the heart and arteries” when it comes to blood flow, says Jacobs. “But, in terms of what actually gets things done in the body, the calf is very important.”
In November 2020, Hyperice attracted the National Football League as an equity investor through a sponsorship deal. The company also has an in-game sponsorship deal with the NBA.
huether said Forbes that Hyperice has 5,000 confirmed orders heading into market launch. “The more people understand the science and what the products do to the body,” Huether said, “the more utility there is in the products, and the more demand we can create.”
Even with a new product and a new price, convincing the everyday consumer to spend $399 during a time of inflation will be a challenge for Hyperice. Huether admitted that parts of the business have been hit in 2022, with retailers becoming “conservative with buying inventory” due to tightening consumer spending. Hyperice has distribution agreements with more than 60 companies, including Bloomingdales, Nordstroms, Best Buy and Target.
Still, Huether said he’s optimistic about Hyperice’s prospects, citing various revenue streams that include supplier deals with U.S. Army bases and U.S. Navy SEALs to supply the technology around its pump. compression.
“We have the material,” he said. “We build software. Our innovation pipeline is stronger than ever.