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Fitlab, the California fitness holding company behind Y7 and the Ragnar relay race series, filed for Chapter 11 bankruptcy protection in Delaware. Its petition lists $100 million to $500 million in liabilities, $10 million to $50 million in assets and between 1,000 and 5,000 creditors. Y7 has closed its studios, while Ragnar is moving toward new ownership.
Fitlab, the California fitness company whose portfolio included Y7 yoga studios and the Ragnar relay race series, filed for Chapter 11 bankruptcy protection in Delaware this week, according to its court petition. The company estimated $100 million to $500 million in liabilities, compared with $10 million to $50 million in assets, putting the filing at the center of a wider collapse and restructuring of brands it owned or operated.
The petition filed in the U.S. Bankruptcy Court for the District of Delaware lists between 1,000 and 5,000 creditors. Those figures are estimates reported in the filing; the available account does not identify the company’s largest creditors or explain how much each is owed. Chapter 11 is a court-supervised bankruptcy process that can allow a company to reorganize while addressing its debts.
The filing follows the closure of all Y7 physical studios. Founder Sarah Larson Levey wrote in a Sept. 16 Substack post that the studios went dark in late August and September, with the last closing by Sept. 11. Fitlab acquired Y7 in late 2024. Larson Levey told Athletech News in September that she sold the chain in a deal intended to finance franchising, but that franchising did not happen.
Fitlab’s other brands have also faced disruption. Nike Studios, which opened in 2023, stopped operating in March, and Fitlab’s Mile High Run Club is described as defunct. Ragnar, meanwhile, is moving toward a change in ownership. In a letter to participants the day after Fitlab filed, CEO Philip LaHaye said a new investor group had funded seven events since mid-August and described the bankruptcy petitions as part of the process toward completing its acquisition of the race series.
Y7 Closures and Ragnar’s Ownership Shift
The bankruptcy filing matters to customers, event participants, employees and creditors because Fitlab’s financial problems are playing out across businesses with different immediate prospects. Y7’s studios have closed, leaving customers with questions about services and any payments or memberships. The filing’s creditor estimate also signals that the case could involve a large group of businesses and individuals seeking payment, although the source material does not identify them or detail what they are owed.
Ragnar’s situation appears distinct from Y7’s closure: LaHaye says a new investor group has funded recent races and is working toward acquiring the series. That indicates events have continued during the ownership process, but it does not establish that the acquisition is complete or clarify how the bankruptcy case will affect the transaction. Fitlab’s Chapter 11 case may shape the handling of its assets and obligations, while the fate of individual brands could depend on separate arrangements.
For the fitness industry, the filing is a reminder that a holding company’s financial distress can affect several brands at once, from studio chains to races and training products. But the available information does not establish why Fitlab became insolvent or whether the brands’ operating difficulties arose from the same causes. The court figures describe the company’s estimated financial position, not a final ruling on claims or a complete account of its business performance.
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Fitlab’s Brand Portfolio Unravels
Fitlab acquired Y7 in late 2024. Larson Levey said the sale was intended to provide funding for a franchising plan. She told Athletech News that when she sold the company, Y7 generated $10 million in annual revenue and $1.2 million in consolidated EBITDA. Those are figures she provided about the business at the time of sale, not audited results presented in the bankruptcy filing. The planned franchising did not take place, according to the report.
Larson Levey also said an entity called VM Fitness took over Y7 this summer and missed payroll in early August. The available report does not detail VM Fitness’s legal or financial relationship to Fitlab, or establish the sequence of decisions leading to the closures. Fitlab’s portfolio also included Assault Fitness, RPM Training, Racked, XPT and the now-defunct Mile High Run Club. The report says Racked appears to be closed, while XPT is a breathing, movement and recovery platform founded by Laird Hamilton and Gabby Reece.
Fitlab also operated Nike Studios, which opened in 2023 and closed operations in March. The filing and the brand closures mark a sharp change for a company that had assembled businesses across fitness classes, equipment, training and endurance events. The source material does not give a full timeline for each brand or say whether all portfolio companies are included in the same bankruptcy proceedings.
““Watching it end this way has broken my heart in a way I don’t have words for.””
— Sarah Larson Levey, Y7 founder, in a Sept. 16 Substack post
Creditors, Claims and Brand Futures
The bankruptcy filing gives broad estimates for Fitlab’s assets, liabilities and creditor count, but the available report does not provide a detailed creditor list, a proposed repayment plan, or a final accounting of the company’s finances. Those estimates may be subject to further review through the court process.
It is also unclear how Fitlab’s filing will affect the Ragnar acquisition, which brands or assets may be sold or reorganized, and whether any operations beyond the reported closures will continue. Levey’s statements about Y7’s financial condition, VM Fitness’s takeover and missed payroll, and responsibility for the shutdown are attributed claims. The source account does not include responses from Fitlab or VM Fitness, or independent confirmation of those assertions.
Court Case and Ragnar Deal
The next developments are likely to come through the Delaware bankruptcy proceedings, where creditors and other parties can respond to the filing and the company’s financial position can be addressed. The source material does not give a hearing date, a restructuring proposal or a timetable for resolving the case.
For Ragnar, the immediate milestone is whether the new investor group completes its acquisition. LaHaye’s letter says the group has funded seven events since mid-August and that the bankruptcy petitions are a step toward completing the deal, but no closing date or final terms are reported. Further information about the transaction, event schedule and Fitlab’s other brands remains pending.
Key Questions
What did Fitlab report in its bankruptcy filing?
Fitlab estimated $100 million to $500 million in liabilities and $10 million to $50 million in assets. It listed between 1,000 and 5,000 creditors in its Chapter 11 petition in Delaware.
Are Y7 studios still open?
No. The report says all Y7 physical studios closed, with founder Sarah Larson Levey saying the last location shut by Sept. 11. The available source does not describe any ongoing studio operations.
Has Ragnar been sold to a new owner?
The sale is not reported as complete. Ragnar CEO Philip LaHaye said a new investor group funded seven events since mid-August and that Fitlab’s bankruptcy filing is a step toward completing the acquisition.
What happened to Nike Studios?
Fitlab operated Nike Studios, which opened in 2023 and closed operations in March, according to the source report. It does not provide further details about the closure or the status of related assets.
Why did Fitlab file for bankruptcy?
The report confirms the Chapter 11 filing and the financial estimates in the petition, but does not establish the causes of Fitlab’s financial distress. Levey has blamed Fitlab and VM Fitness for decisions that led to Y7’s closure; that is her allegation, and the available report does not include their responses.
Source: athletechnews.com
