Zwift raises $120 million to help fund expansion into eSports

Virtual training platform Zwift has raised $120 million in funding which it says will finance its expansion into eSports as well as growing its Zwift Run operation, launched earlier this year.

With world cycling’s governing body, the UCI, drawing up rules for virtual racing and announcing plans for an eSports world championship, the emerging area of virtual racing – rather than just training – is set to explode.

Unsurprisingly, it’s an area of huge focus for California-based Zwift, which just last week announced a partnership with British Cycling to launch an eRacing national championship next year.

Zwift co-founder and CEO Eric Min highlighted that the platform is used by many top professional cyclists and also predicted that cycling was poised to become “the first true eSport” – and that the company would be at the vanguard of making that happen.

“With this significant investment, led by Highland Europe, Zwift is now more than ready to propel the business forward by providing innovative offerings that are greater in breadth and depth,” he said.

“In 2018, more than one third of the Tour de France peloton were Zwifters. With that support already in place, we are in the unique position of being able to combine affordable physical endeavour with video gaming technology, ultimately setting the stage for us to become the first true eSport of its kind.

“We’re not here to compete with pro cycling as we know it, we’re here to deliver new energy, entertainment, audiences and commercial partners to pro cycling,” he continued.

“We want to create a new sport within a sport. Don’t expect to see first across the line stage racing, Zwift is going to turn into a battleground for pro cycling teams and deliver a truly gamified experience which will be shared with our subscriber base globally.

“I personally believe Zwift will play a leading role in the future of professional cycling.”

Dimension Data rider Mark Cavendish, winner of 30 Tour de France stages and the world championship in 2011, is among those who use the platform.

He said: “Zwift has transformed the way the professional peloton trains. Before Zwift, there is no way I would have chosen to ride an indoor trainer. Now though, I genuinely enjoy it - it appeals to the gamer in me. Riders like myself are genuinely fitter now, thanks to Zwift.”

Joining Highland Europe as fellow investors in the latest round of Zwift’s funding are True – which owns the Ribble brand, Novator and Causeway Media, which invests in both traditional sports and eSports.

Tony Zappala, a partner at Highland Europe, said: “Zwift is a fantastically innovative company and they are certainly leading the way in the indoor training space

“It’s a highly scalable business and we’ve been impressed with how they have already managed to expand globally – already 70 per cent of current subscribers are from outside the USA.”

Zwift currently has 1 million subscribers, but Zappala believes there is huge potential to increase that figure.

“Research points to an audience of 40 million competitive and enthusiast cyclists, and many of those lie in the traditional cycling nations of Central Europe, so in this market alone there is huge growth potential,” he added.