Lululemon to buy connected fitness startup Mirror for $500 million

Details: Lululemon and Mirror had an existing business relationship, including a small equity investment, and began acquisition talks fairly recently.

• The $500 million is in cash, per a source familiar with the situation.
• Mirror raised over $70 million in venture capital since its 2016 founding, most recently last fall at a $300 million valuation. Backers include Lerer Hippeau, Spark Capital, Point72 Ventures, and LionTree Advisors.
• Expect to eventually see Mirror displayed in Lululemon stores, which also may host Mirror classes.

The big picture: Shares of connected fitness leader Peloton fell in the aftermarket on the news, although the company remains valued north of $16 billion. Two weeks ago, connected rowing company Hydrow raised $25 million in new funding, while Tonal is reportedly in talks to raise around $250 million.