Shalom Meckenzie made a $1.4 billion fortune after merging his software company with DraftKings. He now believes his new fitness company, Amp, could be even bigger—just don’t remind him about Peloton. Or Mirror. Or...
In October 2020, Shalom Meckenzie was playing poker with his employees on a 192-foot yacht off the coast of Greece, celebrating that his gambling software company, the Isle of Man–based SBTech, had merged with DraftKings to go public via a SPAC in a $975 million deal a few months earlier. As the largest shareholder of DraftKings, Meckenzie became a billionaire that May when its share price passed $25. During one of the poker hands, he made a losing bet that would cost him hundreds of thousands of dollars—and inspire his next venture.
One of his top product executives in Bulgaria weighed 280 pounds but had never been motivated to lose weight. Meckenzie, feeling flush with success, proposed a big wager. “I told him that if by the first of January you’re below [220 pounds] I’m going to take a 300-foot yacht in the Caribbean, and you’re going to choose all the people that are going to go on the yacht, and you’re going to have the craziest and most fun week you will ever have,” says the 48-year-old Meckenzie from his home office outside Tel Aviv, Israel.
The employee, Ian Bradley, accepted the wager. The other executives sitting on the yacht realized that if their colleague won, they would get a vacation invitation and decided to help him lose the weight. Back in Bulgaria, they put a stationary bike in Bradley’s living room, threw out the junk food in his pantry and hired a chef and personal trainer. The trainer was told he would get a big bonus if Bradley lost 60 pounds over the next few months. He lost the weight and won the bet.
“It was one of the best bets I’ve lost in my life,” says Meckenzie, who is in great shape for any age, let alone a man nearing his 50th birthday. Meckenzie flew Bradley and ten others on a private jet to Dubai, where they stayed at a five-star hotel and partied for five days. “I think it ended up costing much more than a yacht in the Caribbean,” Meckenzie says, laughing.
Amped Up: “People have the right to say maybe I'm a bored billionaire,” Meckenzie says of his push into fitness. “It’s not a hobby, I’m passionate about it."
Jamel Toppin for ForbesThat friendly wager became Meckenzie’s proof of concept for his newest company, Amp Fitness, which is based in New York City. He isn’t the first one to think there’s a big business in at-home workouts: Amp’s business model is nearly identical to that of a slew of failed and struggling exercise companies like Tonal, Peloton and Mirror: Sell wealthy folks an expensive machine, hire a bunch of celebrity trainers, collect “data” and then pray you can make money by expanding into more profitable ancillary markets (personalized nutrition, subscriptions and apparel) before the customers get bored and move on. It hasn’t worked for anyone else, but that’s not stopping Meckenzie, who is largely self-financing the company for now.
A minimalist version of a cable crossover machine found at any gym, the wall-mounted Amp costs $2,000; accessing the trainers (both AI and human) through the app requires a $23 monthly subscription. Because Amp lacks a screen (users log in through their own devices), the upfront cost is about half of Tonal’s. Amp, which launched sales in January, has hired a dozen or so fitness influencers and minor celebrities as trainers, the most famous of whom is America’s Got Talent host Terry Crews, who has 14 million followers on Instagram.
None of this is especially novel, and it’s difficult to see how it’s a good idea. The connected at-home fitness device market is ultracompetitive and highly saturated. It boomed during the pandemic but is now littered with the shells of companies vastly better financed and much earlier to market than Amp. Tonal, backed by LeBron James and Serena Williams, raised $250 million at a $1.6 billion valuation four years ago. Burning cash, it was forced to raise an additional $130 million at a reported $600 million valuation in 2023, a valuation haircut of some 63%. Hydrow, a Boston-based rowing outfit fronted by Justin Timberlake, has undergone at least two rounds of layoffs, but the company says it is now profitable. Lululemon bought Mirror for $500 million in 2020 before shutting it down three years later.
Peloton, the connected-bike and -treadmill company, is the most successful of the bunch, with 3 million monthly subscribers and an enviable 1.4% monthly subscriber churn rate. But it’s deeply unprofitable. Last year Peloton lost $552 million on $2.7 billion in revenue. It did generate a meager $3.5 million in Ebitda in 2024, but that took more than a decade and billions of dollars in losses, multiple product recalls, a new CEO and the firing of hundreds of employees. Peloton’s shares are also down 96% from their pandemic peak in January 2021. Peter Stern, the CEO of Peloton, admitted the company has a “tall hill to climb” during last quarter’s earnings call.
Alex Alimanestianu, former CEO of Town Sports International, the parent company of New York Sports Clubs, and a current investor in the fitness space, believes the at-home fitness industry is here to stay but says the market is plagued by superfluous gadgets. “I wouldn’t call it a fool’s errand, but what I’ve seen to date is that most people who want a home strength setup are well served with the old-school equipment,” he says. “I feel like the smart strength equipment is a little bit like Sharper Image—it’s a nice design, looks cool, but it isn’t really necessary.”
Less Is More: A minimalist version of a cable crossover machine, Amp uses no weights—rather a silent electromagnetic motor creates resistance, from 5 lbs. to 100 lbs.
ampSimeon Siegel, an analyst at BMO Capital Markets who covers Peloton, says the fitness industry is a “very difficult sector” riddled with fads and fickle consumers. It is expensive to design and build a product, scale up production, attract customers and then retain them. “Peloton believed they could grow infinitely,” says Siegel, who believes Peloton is finding its way back. “They believed if they built it, people would come. And the reality is this audience, the addressable market size for people who watch Netflix, is very different than the addressable market size for people who get on a bike or a treadmill.”
All this skepticism only motivates Meckenzie. “When I started SBTech, many people came to me and said, ‘Shalom, you’re stupid, you’re using all the money you have and [money] you don’t have, and you’re going to get you and your family in trouble,’ ” he says. “When people offend me, that’s what keeps me going.”
Amp, which Meckenzie founded in 2020, recently installed its first batch of 10,000 units, Forbes estimates, to customers in California, Florida, New York and New Jersey, generating an estimated $20 million in revenue. Its goal is to sell 20,000 devices within the year and more than double that number by the end of 2026. Meckenzie says he is growing the company slowly to avoid product recalls, as Peloton has suffered, and to make sure its first customers are satisfied and supported. “The demand is very high, and my gut feeling is that we are building something very big here—I wouldn’t be surprised if it’s going to be much bigger than DraftKings,” Meckenzie says without irony.
He personally invested about $50 million in Amp. Family and friends have ponied up millions more. Meckenzie knows that’s a paltry sum to scale a hardware company—although he balks at the notion that Amp is a hardware company. He believes it’s a data and wellness firm and says he’s considering a Series A funding round. Finding willing venture capitalists might be challenging: Total funding to the space, which peaked at more than $6 billion in 2021, was under $2 billion in 2023, according to Crunchbase.
“When I started SBTech, many people came to me and said, ‘Shalom, you're stupid,” Meckenzie says. “When people offend me, that's what keeps me going.”
But Meckenzie, who was born in Tel Aviv in 1976, has one great reason for making a big bet on fitness. When he was 18, his father, a Libya-born real estate developer, died at 59 of a heart attack. “That completely changed my life,” he says.
After serving three years in the Israel Defense Forces’ logistics corps, in 2001 he started an online sports betting company, 10Bet, with a partner. Realizing his company could not compete with bigger players in the industry, 10Bet focused on giving customers the best odds. But that only attracted sharp bettors, who nearly bankrupted the startup. (Meckenzie eventually sold 10Bet to his brother, who still runs the company.)
In 2007, he pivoted to selling the software his company developed to set odds, manage accounts and payment integration, calling the new firm SBTech. He sold software to gambling companies around the world. Before merging with DraftKings and going public via a SPAC in April 2020, SBTech was generating around $110 million in annual revenue and had nearly 1,300 employees; its customers included the Danish lottery, Churchill Downs, the Golden Nugget and licensed companies that operated in regulated and gray markets around the world.
Inside his 10,500-square-foot, $50 million apartment along Billionaires’ Row in Midtown Manhattan, Meckenzie shows a visitor a TV screen displaying an NFT he bought for about $12 million—the “Covid Alien” CryptoPunk—and looks out his window, some 50 floors above Central Park. His big bet on sports gaming software bought this place, which also features a deck overlooking Columbus Circle and a private pool. But as the sun sets over New York, Meckenzie is now betting he can make something as addictive, yet not as destructive, as sports gambling.
“People who are betting, they can lose a lot of money that they cannot afford,” he says. “People who are addicted to working out, the worst thing that can happen is they might get injured.”