Fit Analytics Reacquires Its IP from Snap
Fit Analytics has snapped its business back up from ex-parent company Snap.
In 2021, Snap Inc. paid nearly $125 million for the fit tech darling, a German company that became part of Snap’s AR Enterprise Services (ARES) business unit when it launched in March 2023.
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But just months after the launch of ARES, Snap announced its downfall—the business unit would shutter its doors.
According to Snap’s form 10-K, “In the third quarter of 2023, [Snap] initiated wind down of [its] AR Enterprise business, which included a reduction of [its] global employee headcount by approximately 3 percent. [Snap] substantially completed the program in the fourth quarter of 2023.”
When the company announced the business unit would be shuttered after just six months, Snap CEO Evan Spiegel cited the expense of keeping up with web-native AR, the growing pressures pushing against the industry because of generative AI and a need to focus the business around advertising growth.
“The advent of generative AI has made it easier for companies of all sizes to create try-on experiences for their customers and made it harder for us to differentiate our offering,” Spiegel wrote in a blog in September.
Subsequently, Fit Analytics reacquired itself. The former startup announced the deal, which became effective in January, in March.
Snap’s Form 10-K did not disclose details about the transaction because it closed in 2024.
A Snap spokesperson confirmed the transaction and told Sourcing Journal that the company agreed to sell Fit Analytics’ pre-acquisition intellectual property (IP) back to the company’s founder; however, the spokesperson also noted that product innovations or IP that was developed during the period that Snap owned Fit Analytics will be Snap’s IP.
Despite the dissolution of the ARES unit, the spokesperson said, Snap will continue to focus on AR as a strategic priority despite selling off Fit Analytics.
Mar Mercadé Meana, Fit Analytics’ CEO, declined to disclose the process behind reacquiring the company. However, she noted that the team and Sebastian Schulze, founder and chairman of the companies board, knew that the reacquisition of the company would benefit its customers, which range from fast-fashion retailers like Asos and Boohoo to luxury brands like Lacoste and Tommy Hilfiger.
“Our commitment hadn’t wavered. We certainly felt that there was more to be done in this space. We felt that our task was not done, and all things considered, I am very glad that we seem to be proven right with our new start, our new chapter and how we have been able to continue providing support for our clients,” Mercadé Meana told Sourcing Journal.
Both Snap and Mercadé Meana declined to disclose the price of the reacquisition.
Mercadé Meana said the Fit Analytics team had more employees prior to its initial acquisition by Snap, but the company has hired back much of the core talent that worked on the business when Snap owned it.
“Many employees have returned to us, and all of the central positions of the company are filled by these long-term employees. We have barely any net-new people because we have emphasized over and over that our priority was to be able to work at full speed on new products, on innovation,” she said.
Having tenured employees on the team helped ensure no service disruptions to customers occurred during the transitional period, when the future of the company may have been in limbo, Mercadé Meana said.
“This smaller team remained and ensured service continuity that clients were able to enjoy,” she noted.
The company’s proprietary technology, Fit Finder, enables end consumers to answer some questions about their height, weight and body shape and receive size and fit recommendations based on the data that Fit Analytics has aggregated about consumers and products its clients sell.
“There was no down time for any of our clients. We were able to maintain our 3.9 billion…recommendations, even through Black Friday, which happened during this limbo stage—in between the closing of ARES and the restart of Fit Analytics,” Mercadé Meana told Sourcing Journal.
The company will continue innovating to meet the needs of its customers, Mercadé Meana said. However, the climate for technology purchases appears to be limited at the moment because of budget tightening efforts.
“We see that the hunger is there, but [companies] are not buying off the menu,” she explained. “‘We have food at home,’ is sort of the sense we’re getting from brands. We are in a lucky position due to being established, but I have no doubt that this emerging technologies will have their time to shine. It might just take a little longer due to the [budgetary] circumstances.”
