Peloton, the virtual spin class aiming to be the Netflix of fitness, has already saddled up celebrity fans including David Beckham and Hugh Jackman. Now it is spending £50m in the UK as part of a bid to sign up 1 million members in Europe.

The New York-based company has given the exercise bike a high-tech spin, adding a screen on which subscribers can live stream or download classes filmed at the company’s Manhattan studio, while interacting with other Peloton members via social media. Instructors can interact with hundreds of fitness fans riding along at home.

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Valued at $4bn after raising $550m this summer from investors led by the private equity firm TCV, which has previously backed Netflix, Spotify and Facebook, the company will launch a multi-million pound national TV and digital billboard advertising campaign later this month and is building its first fitness studio outside the US in London’s Covent Garden.

David Minton, the director of fitness market analysts DBLeisure, said: “They have got so much money this is like McDonalds doing a national TV ad when it just has one shop. It’s a bit of a landgrab.”

Peloton has hired two British instructors who will begin live streaming classes from London next week. It wants to take on up to eight more in the the next couple of years as it uses London as its base for European expansion. It has also signed up six pop-up shops in London and is looking for premises in northern cities such as Manchester.

Peloton faces competition from New Zealand’s Les Mills, a company which made its name in the 1990s by creating the Bodypump fitness class. It has been streaming virtual fitness classes to gyms in the UK for several years and offers on demand classes, which can be done at home without equipment.

The company has now teamed up with the exercise bike maker Stages to offer a service similar to Peloton’s in the UK.

Facebook Twitter Pinterest A Peloton exercise bike with screen. Photograph: Martin Godwin/The Guardian

Both firms are trying to catch a ride on a growing niche within the buoyant fitness market in the UK, as ageing baby boomers invest in staying healthy, while younger generations put time and money into ensuring they are selfie-fit.

This year the number of gyms in the UK topped 7,000 for the first time, with total membership approaching 10 million, up 2.2% on last year, according to DBLeisure. In the year to March alone, 275 new fitness facilities opened in the UK, helping lift the value of the fitness market to just under £5bn, up nearly 3% on last year at a time when many other consumer businesses are suffering.

Kevin Cornils, the managing director of Peloton’s international division, said London was the obvious next step for the company because of the surge in high-end boutique gyms in the capital in recent years.

The eager adoption of road cycling by high spending “Mamils” – middle-aged men in Lycra - also offers a potentially lucrative market. The company is trying to tempt them in by hiring pro cyclists such as Christian Vande Velde to lead classes that offer tailored playlists for fans of hip hop or 1980s music.

“You have got the Mamil community here which we don’t have in the US,” said Kevin Cornils, managing director of Peloton’s international division. “They were initially cynical about spin classes but they are ready to spend the right amount of money to get good equipment. We are hoping they will see Peloton as a complement to their road bike.”

The company’s 1 million members, the vast majority of whom are currently in the US, pay nearly £2,000 for a purpose-built exercise bike fitted with a screen, and for a £39 a month subscription they can live stream one of 14 exercise classes a day from the company’s New York studio or choose from 10,000 on demand rides.

Riders can see who else is taking part at the same time, electronically “high five” friends or compete against others in the class or in their age group.

The British instructors will begin leading classes from a temporary studio in east London from 13 November, and will move to a permanent gym in Floral Street, in Covent Garden, in about 18 months. It already has 50 staff in the UK but wants to double that within a year.

Cornils said the company has already installed hundreds of bikes in the UK, some of which were brought over by wealthy fans, and it had 3,000 Britons enquiring about bikes before it even launched.