Quarterly Report
Q1 2023
Dear Investors,
It was another successful quarter for the Alturas Business Fund. We are very pleased to report an annualized return to the investor of 28.67%.
The new year ushered in the busiest—and highest performing—quarter of the year in the fitness industry, and at Idaho Fitness Factory. We experienced an increase in members, revenues, and corresponding profitability. The seasonal performance was expected – but we were happy to beat our own forecasts. The new pricing plan, ongoing operational discipline, and seasonal peaking of membership resulted in these great results.
Our team at Alturas is engaged in supporting Idaho Fitness Factory in marketing, expansion, and accounting/finance. We are pushing hard to expand to new locations in the Boise Metro Area and are pleased to report that we have an accepted LOI for our first expansion location post-acquisition. While the expansion is not final, we are working hard to make it a reality.
It feels like time to increase our efforts to source and underwrite our next acquisition. We are re-doubling our efforts to find the next business to buy. Organic deal flow remains strong, and we are beginning additional efforts to source other opportunities. We are in no rush to secure another asset in the fund, and we are committed to ensuring that any new business acquisition fits our strict criteria.
We are proud of the growth we have achieved so far in the fund, which gives us confidence that we can carefully expand the fund, one great business at a time. Thank you for your confidence and partnership with us.
Lucas Henken
Alturas Ventures
Blake Hansen
Alturas Ventures
Dear Investors,
It was another successful quarter for the Alturas Business Fund. We are very pleased to report an annualized return to the investor of 28.67%.
The new year ushered in the busiest—and highest performing—quarter of the year in the fitness industry, and at Idaho Fitness Factory. We experienced an increase in members, revenues, and corresponding profitability. The seasonal performance was expected – but we were happy to beat our own forecasts. The new pricing plan, ongoing operational discipline, and seasonal peaking of membership resulted in these great results.
Our team at Alturas is engaged in supporting Idaho Fitness Factory in marketing, expansion, and accounting/finance. We are pushing hard to expand to new locations in the Boise Metro Area and are pleased to report that we have an accepted LOI for our first expansion location post-acquisition. While the expansion is not final, we are working hard to make it a reality.
It feels like time to increase our efforts to source and underwrite our next acquisition. We are re-doubling our efforts to find the next business to buy. Organic deal flow remains strong, and we are beginning additional efforts to source other opportunities. We are in no rush to secure another asset in the fund, and we are committed to ensuring that any new business acquisition fits our strict criteria.
We are proud of the growth we have achieved so far in the fund, which gives us confidence that we can carefully expand the fund, one great business at a time. Thank you for your confidence and partnership with us.
Alturas Ventures
Lucas Henken
Alturas Ventures
Blake Hansen
Dear Investors,
It was another successful quarter for the Alturas Business Fund. We are very pleased to report an annualized return to the investor of 28.67%.
The new year ushered in the busiest—and highest performing—quarter of the year in the fitness industry, and at Idaho Fitness Factory. We experienced an increase in members, revenues, and corresponding profitability. The seasonal performance was expected – but we were happy to beat our own forecasts. The new pricing plan, ongoing operational discipline, and seasonal peaking of membership resulted in these great results.
Our team at Alturas is engaged in supporting Idaho Fitness Factory in marketing, expansion, and accounting/finance. We are pushing hard to expand to new locations in the Boise Metro Area and are pleased to report that we have an accepted LOI for our first expansion location post-acquisition. While the expansion is not final, we are working hard to make it a reality.
It feels like time to increase our efforts to source and underwrite our next acquisition. We are re-doubling our efforts to find the next business to buy. Organic deal flow remains strong, and we are beginning additional efforts to source other opportunities. We are in no rush to secure another asset in the fund, and we are committed to ensuring that any new business acquisition fits our strict criteria.
We are proud of the growth we have achieved so far in the fund, which gives us confidence that we can carefully expand the fund, one great business at a time. Thank you for your confidence and partnership with us.
Lucas Henken
Alturas Ventures
Blake Hansen
Alturas Ventures
Key Numbers
Key Numbers
Key Numbers
28.67%
Average Realized return Q2
28.67%
Average Realized return Q2
28.67%
Average Realized return Q2
25.99%
Average Realized return since inception
25.99%
Average realized return
25.99%
Average Realized return since inception
$303k
Realized Net income Q3
$303k
Realized Net income Q3
$303k
Realized Net income Q3
$702k
Realized Net income since inception
$702k
Realized Net income since inception
$702k
Realized Net income since inception
Stated returns are average annualized investor returns. Individual investor returns may vary based on the unit pricing at the time of investment. Realized net income (Excess Distributable Income) includes realized gains and losses and excludes unrealized gains and losses recorded during the period. Financial information herein related to the quarters ended in 2023 are unaudited as of the date of this report.
Realized Returns
Additional Fund Metrics
Additional Fund Metrics
Additional Fund Metrics
$2.76M
Total Capital Raised
$2.76M
Total Capital Raised
$2.76M
Total Capital Raised
$491K
Investor distributions since inception*
$491K
Average realized return
$491K
Investor distributions since inception*
25
Number of investors
25
Number of investors
25
Number of investors
90%
Current reinvestment rate
90%
Current reinvestment rate
90%
Current reinvestment rate
$1,000
Unit price
$1,000
Unit price
$1,000
Unit price
$8.51M
Assets under management
$8.51M
Assets under management
$8.51M
Assets under management
*Distributions since inception includes Q1-2023 distributions paid on 4/28/2023.
Idaho Fitness Factory
The first quarter of 2023 proved to be our most successful quarter. We introduced a simplified pricing model and updated our marketing strategy. Despite the increase in membership and usage, the operational team supported membership growth by maintaining standards and increasing new member conversion. Discontinuing group fitness opened up space and allowed staff to focus on standardizing club operations and enhancing member experience. With these changes, we’ve experienced a net increase of close to 600 members over the quarter. Clearly, these two changes had a positive impact on both member experience and our bottom line. Now that we are headed into the slower months of summer, we are now shifting our focus to member retention. Two key initiatives we launched are a revamped digital engagement platform and personal training, both of which we hope increase member retention. With a successful first quarter, the company and team are well positioned to continue to grow and refine our operations to improve performance and member experience.
Idaho Fitness Factory
The first quarter of 2023 proved to be our most successful quarter. We introduced a simplified pricing model and updated our marketing strategy. Despite the increase in membership and usage, the operational team supported membership growth by maintaining standards and increasing new member conversion. Discontinuing group fitness opened up space and allowed staff to focus on standardizing club operations and enhancing member experience. With these changes, we’ve experienced a net increase of close to 600 members over the quarter. Clearly, these two changes had a positive impact on both member experience and our bottom line. Now that we are headed into the slower months of summer, we are now shifting our focus to member retention. Two key initiatives we launched are a revamped digital engagement platform and personal training, both of which we hope increase member retention. With a successful first quarter, the company and team are well positioned to continue to grow and refine our operations to improve performance and member experience.
Idaho Fitness Factory
The first quarter of 2023 proved to be our most successful quarter. We introduced a simplified pricing model and updated our marketing strategy. Despite the increase in membership and usage, the operational team supported membership growth by maintaining standards and increasing new member conversion. Discontinuing group fitness opened up space and allowed staff to focus on standardizing club operations and enhancing member experience. With these changes, we’ve experienced a net increase of close to 600 members over the quarter. Clearly, these two changes had a positive impact on both member experience and our bottom line. Now that we are headed into the slower months of summer, we are now shifting our focus to member retention. Two key initiatives we launched are a revamped digital engagement platform and personal training, both of which we hope increase member retention. With a successful first quarter, the company and team are well positioned to continue to grow and refine our operations to improve performance and member experience.
Financial Summary
As mentioned previously, several operational changes were instituted in Q4 2022 to increase performance in 2023. These included discontinuing group fitness, adjusting the pricing model from an a-la-carte structure to a two-option plan, elevating key leadership members, and changing insurance carriers. By implementing these changes, the team was able to hit the ground running in January and support high growth over the quarter.
Opportunities in 2023
Improve member retention and add revenue streams to mitigate seasonality
Decrease price promotions and focus on brand marketing to increase loyalty and advocacy
Updating equipment in current gyms to enhance member experience
Material Changes
Updated original a-la-carte pricing system to a two-tier model
Introduced personal training as an additional revenue stream
Financial Summary
As mentioned previously, several operational changes were instituted in Q4 2022 to increase performance in 2023. These included discontinuing group fitness, adjusting the pricing model from an a-la-carte structure to a two-option plan, elevating key leadership members, and changing insurance carriers. By implementing these changes, the team was able to hit the ground running in January and support high growth over the quarter.
Opportunities in 2023
Improve member retention and add revenue streams to mitigate seasonality
Decrease price promotions and focus on brand marketing to increase loyalty and advocacy
Updating equipment in current gyms to enhance member experience
Material Changes
Updated original a-la-carte pricing system to a two-tier model
Introduced personal training as an additional revenue stream
Financial Summary
As mentioned previously, several operational changes were instituted in Q4 2022 to increase performance in 2023. These included discontinuing group fitness, adjusting the pricing model from an a-la-carte structure to a two-option plan, elevating key leadership members, and changing insurance carriers. By implementing these changes, the team was able to hit the ground running in January and support high growth over the quarter.
Opportunities in 2023
Improve member retention and add revenue streams to mitigate seasonality
Decrease price promotions and focus on brand marketing to increase loyalty and advocacy
Updating equipment in current gyms to enhance member experience
Material Changes
Updated original a-la-carte pricing system to a two-tier model
Introduced personal training as an additional revenue stream
Idaho Fitness Factory Metrics and Key Performance Indicators
Idaho Fitness Factory Metrics and Key Performance Indicators
Idaho Fitness Factory Metrics and Key Performance Indicators
19,426
Total members
19,426
Total members
8
Total locations
8
Total locations
72,458
Total square feet
72,458
Total square feet
2,428
Average members per location
2,428
Average members per location
$171K
Average revenue per location
$171K
Average revenue per location
$1.37M
Total revenue Q3 2023
$1.37M
Total revenue Q3 2023
19,426
Total members
8
Total locations
72,458
Total square feet
2,428
Average members per location
$171K
Average revenue per location
$1.37M
Total revenue Q3 2023
Member Growth Analysis
The simplified pricing model was launched on January 1, 2023. Previously, various pricing models were implemented. There was little consistency in revenue per member; from “Grandfathered” memberships starting at $15 to the a-la-carte model bringing membership price up to $65. The team decided to reintroduce a two-tier model, which includes “Home Club” at $20 per month, and “Unlimited” at $30. As “Grandfathered” members reach the end of their lifespan, they are replaced by new members at a higher price. This is driving the revenue per member up, and we expect to see all memberships replaced by new members over time.
Member Growth Analysis
The simplified pricing model was launched on January 1, 2023. Previously, various pricing models were implemented. There was little consistency in revenue per member; from “Grandfathered” memberships starting at $15 to the a-la-carte model bringing membership price up to $65. The team decided to reintroduce a two-tier model, which includes “Home Club” at $20 per month, and “Unlimited” at $30. As “Grandfathered” members reach the end of their lifespan, they are replaced by new members at a higher price. This is driving the revenue per member up, and we expect to see all memberships replaced by new members over time.
Member Growth Analysis
The simplified pricing model was launched on January 1, 2023. Previously, various pricing models were implemented. There was little consistency in revenue per member; from “Grandfathered” memberships starting at $15 to the a-la-carte model bringing membership price up to $65. The team decided to reintroduce a two-tier model, which includes “Home Club” at $20 per month, and “Unlimited” at $30. As “Grandfathered” members reach the end of their lifespan, they are replaced by new members at a higher price. This is driving the revenue per member up, and we expect to see all memberships replaced by new members over time.
Fund Description
The Alturas Business Fund is an evergreen business investment fund formed to provide accredited investors access to a diversified portfolio of small to medium-sized businesses. The Fund focuses on acquiring and operating businesses with sustainable and predictable cash flow that produce attractive risk-adjusted returns in the Intermountain West and Pacific Northwest, starting with Idaho. The Fund is a $100 million equity and debt offering.
Fund Description
The Alturas Business Fund is an evergreen business investment fund formed to provide accredited investors access to a diversified portfolio of small to medium-sized businesses. The Fund focuses on acquiring and operating businesses with sustainable and predictable cash flow that produce attractive risk-adjusted returns in the Intermountain West and Pacific Northwest, starting with Idaho. The Fund is a $100 million equity and debt offering.
Fund Description
The Alturas Business Fund is an evergreen business investment fund formed to provide accredited investors access to a diversified portfolio of small to medium-sized businesses. The Fund focuses on acquiring and operating businesses with sustainable and predictable cash flow that produce attractive risk-adjusted returns in the Intermountain West and Pacific Northwest, starting with Idaho. The Fund is a $100 million equity and debt offering.
Our Investment Offerings
Summary of Equity Offering
Our equity offering allows investors to invest in a diversified portfolio of businesses focused on generating excellent ongoing returns from operations. The Fund's offering is best suited for investors who understand and align with the Fund's investment strategy and value long-term partnerships.
Targeted total realized return: 20%
No Preferred Return
Profit Split: 70% investors, 30% manager
Fees: 1.5% asset management fee
Minimum investment: $100,000
Our Investment Offerings
Summary of Equity Offering
Our equity offering allows investors to invest in a diversified portfolio of businesses focused on generating excellent ongoing returns from operations. The Fund's offering is best suited for investors who understand and align with the Fund's investment strategy and value long-term partnerships.
Targeted total realized return: 20%
No Preferred Return
Profit Split: 70% investors, 30% manager
Fees: 1.5% asset management fee
Minimum investment: $100,000
Our Investment Offerings
Summary of Equity Offering
Our equity offering allows investors to invest in a diversified portfolio of businesses focused on generating excellent ongoing returns from operations. The Fund's offering is best suited for investors who understand and align with the Fund's investment strategy and value long-term partnerships.
Targeted total realized return: 20%
No Preferred Return
Profit Split: 70% investors, 30% manager
Fees: 1.5% asset management fee
Minimum investment: $100,000
All projections are hypothetical and predicated upon various assumptions that may or may not be identified as such. The future operating and financial performance information contained herein is for illustrative purposes and is not intended to portray any sort of targeted or anticipated returns. There can be no assurance that the Fund will achieve its investment objectives and actual performance may vary significantly.Alturas Ventures, LLC and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice.