Bethesda-based indoor cycling boutique Zengo Cycle, whose investors include the founder of Hair Cuttery, plans a $10 million expansion to create 20 to 30 new cycling studios throughout the East Coast in the next three to five years.
The company is capitalizing on the trend toward indoor cycling—often known as spinning—that combines technology-loaded bikes, state-of-the-art music systems and “performance art” instructors geared toward making exercise entertaining.
“Our main job is to wow and delight our customers,” said Zengo Cycle founder Marc Caputo. “The goal is to have six studios in the area, then branch out of the region.”
Zengo opened its first studio in Bethesda in October 2011, then expanded to Logan Circle in the District last January. Both are profitable, according to Caputo.
The company has plans to open three more studios by the end of the year, including a location in the Mosaic District in Fairfax County, one in Gaithersburg and a fifth studio that has several possible locations under consideration.
Zengo’s studios vary in cost because of real estate, but they generally range between $300,000 to $500,000 to open, which includes $40,000 for a sound system and nearly $100,000 for 45 bikes.
Cycling studios have become the rage in many cities, with names like Flywheel Sports and SoulCycle attracting celebrities from Kyra Sedgewick to Chelsea Clinton to Kelly Ripa and Tom Cruise.
Zengo’s classes at Bethesda cost on average $18 for just under one hour of cycling. Customers purchase Zengo credits either online or in the studio. Price varies with the number of credits/classes purchased. One credit/class, for example, is $22 while a purchase of 30 credits/classes cost $510, or $17 apiece.
Caputo said the success of Bethesda has spurred the company to expand. The location averaged around 4,000 “rides” - number of hourly customers - in March, which was its most successful month to date.
The company is owned jointly by Caputo, a former bond salesman; Dennis Ratner of the Ratner Companies and Street Sense Capital Partners, which includes Ratner’s cousin, Marc.
Ratner Companies is a family-owned chain of nearly 800 salons in 16 states, according to its Website. Its brands include Hair Cuttery, Bubbles, Salon Cielo and Spa, ColorWorks, and Salon Plaza.
Street Sense Capital Partners is a privately-owned company with investments in retail, hospitality and real estate.