Initial public offerings (IPOs) have been the dream of many investors for years. After all, some of them rise 20%, 50% or even more right on their first day of trading. Now we have an initial public offering of Mindbody Inc. (NASDAQ: MB).

The company dates back to 2001 and it offers an online wellness marketplace of cloud-based management assistance for companies in the wellness and fitness industry. Mindbody claims some 42,000 businesses in over 124 countries worldwide as its customer base. It has been expanding revenue rapidly, but it also has lost money.

Mindbody sold 7.15 million shares at $14.00 per share, right in the mid-point of the $13.00 to $15.00 per share price range. Meanwhile, many other IPOs have priced at the higher-end of their ranges, and some have priced at premiums.

Morgan Stanley, Credit Suisse Securities and UBS Securities were the joint book-running managers for the offering. Co-managers were listed as Pacific Crest Securities, KeyBanc Capital Markets and JMP Securities. Mindbody has granted the underwriters a 30-day option to purchase up to an additional 1,072,500 shares of common stock to cover overallotments.

Mindbody has been growing revenues very fast: from $32.0 million in 2012 to $48.7 million in 2013 to $70.0 million in 2014, and the first quarter of 2015 saw sales growth of 42% from a year earlier. Operating expenses have risen handily as well. Mindbody’s losses have been growing: -$5.5 million in 2012, -$16.2 million in 2013 and -$24.6 million in 2014, and the net loss in the first quarter of 2015 was up 62% from the same period a year ago.

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While it goes without saying that this is an interesting niche, still Mindbody’s trend of losing more money to get more growth is hard to ignore. Another consideration is that health and wellness businesses, like fitness centers and gyms, cross-fit, yoga studios and other related businesses, have a history of opening and closing, and they often lack proper management ranks that can support the business if one key person is gone.

Mindbody is an interesting company on the surface. Now it will have to prove to investors that it can turn all that growth into sustainable profits — and then it will have to grow that profit.

Mindbody shares were last seen trading at $13.62 on 6.7 million shares at 10:45 a.m. Eastern Time.

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