Feb. 4, 2020

You Might Be Sore Tomorrow: Fitness Gets the Tech Treatment

You Might Be Sore Tomorrow: Fitness Gets the Tech Treatment

Maybe you’re the kind of person who holds your plank an extra 15 seconds during 6am HIIT class (showoff). Maybe you need a full day to recover from 20 minutes on the elliptical.

Maybe you’re the kind of person who holds your plank an extra 15 seconds during 6am HIIT class (showoff). Maybe you need a full day to recover from 20 minutes on the elliptical.

 

Either way, this one likely applies to you: tech obsession. The zeitgeist’s current fixation with new-wave, at-home, tech-enabled fitness is changing the way we define success, both in terms of personal health goals and in terms of happy business endings (read: IPOs).

 

This week on Business Casual, we talk to Mirror CEO Brynn Putnam to understand exactly how tech’s influence on today’s fitness startups is impacting the business world. Brynn explains…

  • What about the at-home fitness business model works
  • How good tech and smart engineering can scale the unscalable
  • Why every company is fighting for a tech valuation, even if it doesn’t deserve one

 

One parting idea: Putnam thinks in-home fitness streaming devices can become the next iPhone. Do you?


Transcript

Note: Business Casual transcripts are generated using speech recognition software and human transcription. They may contain errors, although we do our best to avoid them. Please check the corresponding audio before quoting a transcript in print. Questions? Errors found in a transcript? Email businesscasual@morningbrew.com

 

[00:00:01] [sound of coffee being poured]

 

[00:00:04] [intro music plays]

 

Kinsey Grant, Morning Brew business editor and podcast host [00:00:06] Hey there, and welcome to Business Casual. This is the weekly podcast for Morning Brew, delivering you the answers to some of businesses’ biggest questions. I'm Kinsey Grant, your host and Brew business editor.

 

Kinsey [00:00:17] And now let's get into it. If there's one thing that people love to talk more about than bragging about the books they've just read, it's bragging about how much they work out. It's compulsive, like accidentally doing your Zumba top moves at the club. But the way that we exercise today is a far cry from Jane Fonda or really any other time, for that matter. And the exercise industry as a whole is worth a metric ton of money. In the U.S. fitness industry alone, when we're talking health clubs and gyms, it's a total of $27.8 billion dollars in revenue in 2017. But these days, it's about way more than health clubs and gyms. Increasingly, the way that money is made in the fitness industry is far less about personal trainers and more about sharing on social media, incorporating technology, and achieving that sought-after viral success, because good form matters, but becoming a cult favorite matters more. And in the age when ClassPass recently became a unicorn and Peloton just IPOed, it seems like the right time to talk about it. So today we're going to try to understand the sweaty, nuanced beast that is the ballooning tech-forward fitness industry. And I've got a big question: How has this generation's obsession with new wave at home kinds of fitness changed the business of working out? And to help answer that question, I am talking to Brynn Putnam, the founder and CEO of Mirror. Welcome to Business Casual!

 

Brynn Putnam, founder and CEO of Mirror [00:01:37] Thanks for having me.

 

Kinsey [00:01:39] Really excited to talk about Mirror. And I think maybe for the people out there who haven't heard of the product yet, I'm going to do my best describing it. It's kind of an indescribable product, but you might know it as the gift that Alicia Keys got for Christmas. And that was kind of when you guys really hit that viral moment. But it's a piece of fitness tech that when it's not used, looks like a plain old mirror, but when turned on, it's called a connected fitness system. Lets you stream live on-demand classes in your home, uses a responsive display, so you get to see yourself working out on one end, but you also get to see someone either leading a class or, you know, eventually doing personal training, correct?

 

Brynn [00:02:12] Yep, absolutely. It's a nearly invisible interactive home gym where you can see yourself as well as your trainer, your community, personalized metrics and tips and all in a single, beautiful in-home display.

 

Kinsey [00:02:25] Yeah, and it works with an app, correct, on your phone?

 

Brynn [00:02.28] Yes, it's controlled by a companion app.

 

Kinsey [00:02.30] Nice. So very much the tech-forward part of the business. We actually got to stop by the Mirror showroom a couple weeks before we recorded this podcast and tested out the product. It's, it's kind of hard to, like I said, indescribable. It's hard to kind of explain how it works. But we did a lot of different classes. We did, like, cardio strength training. We tried some yoga. We got producer Josh doing some yoga too. And it was really close. It's, you know, it's cool to be able to try out the different things that maybe you're a little too nervous to do in a class. You don't want to spend the $35 for a class that you're not convinced you're going to love.

 

Brynn [00:03:00] We've seen that a lot. It's been really exciting to see people exploring. So, over the course of their time with Mirror, members generally explore over five different types of classes, and you see member behavior that you probably wouldn't see out in the wild. You see men trying bar classes or older students trying really involved cardio dance routines. So it's been really exciting to see people willing to explore from the privacy of their own home.

 

Kinsey [00:03:22] Yeah. And you guys started in 2016. That's when you founded the company.

 

Brynn [00:03:26] We did. We started developing the product in 2016, spent about two years in development, and then launched in September 2018.

 

Kinsey [00:03:33] OK. And since then, it's been a lot of press and then it's been a really kind of inflection point for the fitness industry as a whole, I would argue. But I want to talk about industry analysis on the whole and just as I can. But I think it's kind of first important to hear your perspective about why the fitness space was where you wanted to kind of dedicate your career. And that's, you know what—what were the core tenets of this industry that drew you to it in the first place?

 

Brynn [00:03:58] Absolutely. So I've spent really my whole life in health and wellness. I was a professional dancer at the New York City Ballet, went to Harvard, kept dancing professionally, and really got involved in fitness as a side hustle to make ends meet. When I returned to dancing post-college at that point, there were really no boutique fitness studios. You had your neighborhood yoga studio, maybe a local Pilates studio. But this idea of paying a premium for higher-quality classes and instructors really was just developing at the time. But I really liked the business model. I thought it really aligned the interests of the gym and the member. The idea that people were paying for an incredible experience versus paying for fancy showers or the latest treadmill, I mean, I saw my members really making progress.

 

Brynn [00:04:39] So when I retired from dancing, I opened a studio called Refined Method in 2010, and then grew that over the next decade to multiple locations here in New York. What has been really personally rewarding for me is just this kind of learning that fitness is really the baseline of confidence for many people. If you feel comfortable in your own body and comfortable in your own skin, that translates into success in your career, translates into interpersonal success, and it's really essential for everything you want to accomplish. And so if I can be a part of that success, and then use technology to scale that confidence, it's really personally rewarding.

 

Kinsey [00:05:14] Why do you think it is that people pay so much for a workout? You know, whether it's I pay a couple hundred bucks a month for unlimited bar classes. People pay even more than that for an Equinox membership. Do you think it's because people are trying to achieve that kind of confidence?

 

Brynn [00:05:28] I think that, frankly, people are really learning to prioritize health and wellness. So discretionary income has really shifted over time from designer handbags and sporting events to things like health and wellness experiences, because people understand that if they invest in their health and well-being, it pays dividends. And so I think those experiences do cost money. You have to maintain high-quality talent, beautiful facilities, and people are willing to invest.

 

Kinsey [00:05:54] OK. When we talk about people investing, you typically don't share specific sales numbers. Or are you willing to give any sort of ballpark number for how many Mirror devices you've sold?

 

Brynn [00:06:06] Well, we've sold tens of thousands. We exceeded our 2019 sales target quite significantly, almost 2x what we were hoping to sell. So that was incredibly exciting for us. I think other things that are really exciting for us is just the breadth of our member base. So 50% of our members are in the South, Midwest, and Southwest.

 

Brynn [00:06:25] We have almost 50% of our devices financed. Close to 70% are sold to households with less than a $100,000 in household income. And we have a really wide distribution across all age ranges and genders. So, it's been really exciting for us to see that the Mirror is truly a national platform.

 

Kinsey [00:06:43] Right. And when we talk about reaching a kind of wider swath of the country, price is obviously something that is an issue when we talk about any kind of fitness, but especially something like a Mirror. You guys, the base cost is $1,495? And then you have to get a subscription of $39 a month. Do you find that to be a prohibitive price tag for many people? And what share of, you know, overall, since your founding, have you noticed more people financing the product?

 

Brynn [00:07:12] I think for us, people really understand the value of the Mirror. So for $39 a month, you're able to have unlimited live and on-demand classes for up to six members. Most of our households have over two users, which means that generally you're not seeing just the parents in the house using the device, but also multiple children finding value. So for a family that's used to paying for a country club or multiple gym memberships or a series of class packs, in many ways they're seeing a great savings. But we also offer expanded financing as of earlier this year, which enables people to pay over time. So zero dollars down, 0% APR. And I think that's been really important for people to be able to access the content they want to access.

 

Kinsey [00:07:53] Okay. Have you ever encountered pushback in—and you guys have raised a good deal of venture money. Have you found pushback in that this is a pretty expensive product, that your addressable market might not be as large as something that's a $29 a month for a gym membership?

 

Brynn [00:08:09] Honestly, no. I mean, I think for us, we really have aspirations to be the place that you turn for all interactive immersive experiences. So fitness is one segment of our market and I think we could build a multibillion dollar business off of fitness alone. But we really have aspirations to be truly the next iPhone, which means that our market is anyone who enjoys immersive interactive experiences at home in a wide range of disciplines.

 

Kinsey [00:08:31] I want to talk more about this idea of becoming the next iPhone in just a second. But quickly, are you profitable?

 

Brynn [00:08:37] No, we are not profitable, but we certainly have a clear path to profitability within the near future.

 

Kinsey [00:08:41] Do you have any sort of a time frame on achieving that goal?

 

Brynn [00:08:48] I come from a bricks-and-mortar business, where a client 1 pays for client 2, studio 1 pays for studio 2. So building a business where the unit account economics fundamentally work is kind of in my DNA.

 

Kinsey [00:08:59] Okay, got it. So about this whole idea of becoming the next iPhone. I've heard you say before that you guys view yourselves as becoming the third screen in someone's home. Explain to me more what you mean by that.

 

Brynn [00:09:10] Yeah, I think that we live in a world in which people want dedicated devices for different things. I think your phone is the perfect device for small informational interactions. A quick text, a short note. Your TV is really great for passive entertainment. Lie back on the couch and enjoy something. And the Mirror is built for interactive immersive experiences. It's about something where convenience, privacy, and community really make sense. Fitness is obviously a great first experience for us, but there are many experiences where all those tenets hold true. So we really view ourselves as building dedicated real estate in the home and building a brand and community around this new type of interaction.

 

Kinsey [00:09:48] Sounds like a massive undertaking. A difficult, maybe even lofty goal to achieve. How do you go day to day about achieving that goal of kind of becoming the next iPhone? That took tons of capital and a long, long time.

 

Brynn [00:10:06] I think the biggest thing is saying no. I think when you're building something where the possibilities are endless, then the growth potential is unlimited, it's very tempting to do too many things at one time. But I'm a ballerina by training and the dance—each day you sort of show up and try to be incrementally better than the day before, and 100% is never achievable, but always the destination. And I think when you unite, sort of better is better. With this unlimited potential, you get a lot of discipline and focus about what you tackle and how you execute. So for us, it means really just doing things in phases and steps, but knowing that our mission is quite big.

 

Kinsey [00:10:41] So your mission is more than just fitness, as you said. What do you think is then the next most easily attainable goal for using the Mirror tech beyond just doing a yoga class or doing a bar class or something like that?

 

Brynn [00:10:53] Yeah. So we are about to launch meditation in partnership of Lululemon, and that enables us to move from our core offering fitness into greater wellness. From there, we move into some interesting applications for some of the more senior members of our population in physical therapy, rehab, and senior wellness. So we're moving sort of incrementally outside of our core over the course of the coming months.

 

Kinsey [00:11:16] Telemedicine comes to mind pretty quickly. I mean, that seems like easy money for you guys. And that's a huge ballooning market as well.

 

Brynn [00:11:23] Yeah, absolutely. We launched personal training a few months ago, which was the first time we enabled the camera and microphone in the Mirror. And so we moved from not just one-to-many class content, but one-to-one personalized experiences. And with that unlock, there is so much potential for things like telemedicine, where that one-to-one interaction makes sense.

 

Kinsey [00:11:43] Did you initially build the Mirror before you unveiled that tack? Did you build it with the camera and microphone knowing that you weren't ready to use it yet?

 

Brynn [00:11:51] Yep, absolutely. So it's really important to us that the Mirror you buy today will be the Mirror that you use far into the future. And so we built the device with the camera and microphone inside knowing that it would be a future on lock.

 

Kinsey [00:12:01] Okay. I would talk about this aspect of at home fitness. And I know that it'll be more than fitness eventually or ideally it will be. But for the purposes of today, we talk about at-home fitness. We've seen a huge expansion in this market from the Pelotons of the world to even Flywheel new ordering classes through Hulu. Things like that. Why do you think that there is such a draw for people to working out in their homes as opposed to the more traditional model of getting a gym membership and going three or five times a week?

 

Brynn [00:12:30] I think the idea that at-home fitness is sort of a new trend or a fad even is a bit of a misperception. So Bowflex built a multibillion dollar business pre-internet off of catalog sales, selling to people and home folks like Jane Fonda, who you mentioned earlier, had booming businesses off of workout DVD and tapes.

 

Brynn [00:12:51] So I think there's always been this in-home need, but there's just been this much mismatch where you were sort of sacrificing quality for convenience. And so with the advent of technology and frankly, I think a greater shift of dollars and talent into the space as a result of the boutique boom, you're seeing just better options. So behavior that people were already doing is now being met with better tools to serve their needs.

 

Kinsey [00:13:15] Right. And I think that you make a good point in that the influx of tech is the most important part of this year. I mean, the fitness app market is skyrocketing, it's gonna be worth $14.7 billion dollars by 2026. That's not a small sum of money. Do you view yourself more as, at least in today's terms of what Mirror is, a tech company or a fitness company?

 

Brynn [00:13:36] Neither. We really view ourselves as a media company, so it's essential for our growth and all of our success to have a dedicated channel into the home. But fundamentally, we were the first media company that owns not just a unique channel, but also original content. And for us, we think that all of our future success is truly pinned on how well we can create incredible content that serves our members’ needs.

 

Kinsey [00:13:58] We talked a lot, at least in recent months, especially after Peloton's S1, when they announced that they're going to list shares. They call themselves a technology, media, software, product experience, fitness, design, retail, apparel, and logistics company. That was a lot of words. [Both Kinsey and Brynn laugh] Do you think that, you know, this theme of “I'm not just a fitness company” or that Sweetgreen as a tech company, not a salad company, is that, you know, impair your ability to kind of think realistically in any way?

 

Brynn [00:14:28] No. I mean, I think we're fundamentally building our business differently than all of our other competitors in this space. Most of our competitors are product-first, tech-first companies. They are growing via product line extension. You build a bike, you build the treadmill, you build a rower, and so on and so on. We really have a hero product and it's a platform. And all of our future growth comes from adding additional content and experiences onto our channel. So we've oriented everything about our business just very differently from the competition. Everything from how we hire, who we hire, and where we invest our time and money. So I do think we have a very different approach.

 

Kinsey [00:15:06] OK. Two questions. First, do you see any sort of possible future in which you can use Mirrors platform without having a Mirror device in your home?

 

Brynn [00:15:15] Yes, absolutely.

 

Kinsey [00:15:17] So using something like an app or you subscribe via an app on your phone and that's all you have. You don't have the actual Mirror product.

 

Brynn [00:15:24] Certainly am. And I think Apple and the content will be available to our members in Q1. So we've had so many members who want to continue their Mirror experience when they're away from their Mirrors, you know, traveling on the road. And so that's something we’ll release shortly. I think that there's a future in which you'll be able to access the mere content and experience via other devices and platforms. But again, we're sort of stuffing our way forward.

 

Kinsey [00:15:46] OK. And then second question, who do you think is your biggest competition right now?

 

Brynn [00:15:48] I think—I don't, I don't mean this in an arrogant way, but I really do think we are in a category of one, and we're sort of competing against ourselves and achieving our mission and vision that we've set out to create.

 

Kinsey [00:16:02] Do you think that, let's just say like Apple or Peloton? Who do you think about more in terms of, let's build the best version of Mirror possible?

 

Brynn [00:16:12] Truly neither. I don't really think there are many folks who can, who can chase us.

 

Kinsey [00:16:16] OK, we'll talk more about who might or might not be chasing you shortly. But really quickly, let's take a quick break to hear from our partner. — And now back to the conversation on fitness and the future of fitness tech with Mirrors at Brynn Putnam. So we were just talking about your competition or maybe lack thereof. You guys, you mentioned just a second ago, you know, you raised close to almost $75 million so far. What do you find the possible investors are most interested in as part of your pitch? Is it the media platform? Is it the opportunity for, you know, telemedicine or something like that? Is it an ecommerce opportunity?

 

Brynn [00:16:56] I think people just really want to know that members love the platform, that we create content experiences that people love, and that we're able to continue to create new experiences that our members love. So really understanding how members are engaging with the platform and that we're generating that member love is really most important.

 

Kinsey [00:17:13] Do you hire more engineers or more fitness instructors?

 

Brynn [00:17:19] [Brynn chuckles] In terms of headcount, we have more engineers than fitness instructors. But in terms of sort of, the areas of growth for our company right now, we're really investing heavily in member experience as the number of Mirrors in the world increase.

 

Kinsey [00:17:32] And when we think about beyond just Mirror, if you had to pinpoint the biggest opportunity for growth in this sort of fitness, tech, media space, what are you looking to?

 

Brynn [00:17:42] I think that anyone who can really execute across, who can execute in the content space, is someone to watch. You know, I think there's lots of people can build great hardware. There's even more people who can build great software, but someone who truly understands what the member wants from their fitness experience. I think those folks are few and far between. You know, the decade that my team spent folding towels and correcting squats in bricks-and-mortar gyms really does translate into a uniquely good experience.

 

Kinsey [00:18:16] We think about the experience of working out. Not always super positive. You know, not everybody goes to Equinox can afford to or even has one near the home if they could afford to. But big-box gyms are still healthy. You know, in terms of opening—they’re opening new real estate, they still exist.

 

Brynn [00:18:36] I think people fundamentally need instruction. I mean, I think that, you know, you would never turn to the person next to you and say, how should I fix my heart disease? But you would go on Instagram or turn to a friend who's in good shape and say, how can I lose weight? How can I get stronger? Or how can I be in less aches and pains from my running training? And so there is this sort of deficit in the fitness space between what people want and need to be successful, and the guidance that they need. So I think people, when they find great instruction and great experiences, are excited about it.

 

Kinsey [00:19:12] That aspect of community has been a big part of your success so far. A lot of your marketing, that at least I've been found on my own, has been through social media influencers—people like bloggers and famous people are big fans of your products. I think Karlie Kloss partook in one of your funding rounds as well. What does that mean to you and how did you achieve that?

 

Brynn [00:19:32] Yeah. The celebrity following has been frankly, largely accidental and very exciting for us. You know, we had a few celebrities who were early members and then the word spread very quickly through the community. So it's really like kind of one of the first groups of people to demonstrate the network effects of the product. When you like something, you tell a friend, you tell your stylist, your lawyer, your banker, another actress and the word kind of spread. So it's been a really fun community for us. I think what's really interesting is that, sort of, the device itself inspires sharing. And so we have seen sort of the word of mouth organically grow really fast.

 

Brynn [00:20:09] I was reading [Brynn chuckles] some of the pieces that have been written about me or because it is—it is the sort of product that almost inspires think pieces. I know that The New York Times is written about it. The Atlantic recently wrote about Mirror. The New York Times called it the most narcissistic exercise of equipment ever.

 

Kinsey [00:20:23] What do you think of that?

 

Brynn [00:20:26] I mean, I think. What's the saying? No press is bad press on a New York Times piece. [Kinsey and Brynn laugh]

 

Brynn [00:20:34] I think that unfortunately, many people and particularly women, spend a lot of time looking in the mirror and criticizing themselves and thinking about ways in which they could be different or, you know, quote unquote, better. And I think giving people the opportunity and encouraging them to look in the mirror and have that experience be one that builds confidence rather than criticism is an important part of our mission. And so it's so exciting when we see members taking Mirror selfies themselves or moms with their young children. And they feel happy and they feel proud. So —

 

Kinsey [00:21:07] It's OK.

 

Brynn [00:21:08] I wouldn't, you know, I think if someone wants to look in the mirror and feel good about themselves, that's a wonderful thing. We did make the decision early on to try to define core values, which we passed to the team. And then we really use those core values to help bring new people into our organization. And one of those is obviously the mission to make—to build experiences that connect people to a better version of themselves.

 

Kinsey [00:21:32] This idea of a better version of yourself, if you buy this product or if you subscribe to this platform, is something that we see a lot, especially in the kind of fitness tech media nexus that we've been discussing in the past. A couple of questions. Do you think that everybody can kind of lay claim to that “here by this and you'll be the best version of yourself?” Or at a certain point, do you think that the audience gets oversaturated with becoming the best version of themselves?

 

Brynn [00:21:59] I think fitness marketing, marketing traditionally has been about physical results. It's been about pounds down, you know, muscle gains, miles run. It's really been very metric-oriented. And Mirror does none of that. We're very—we have very lightweight metrics as part of the experience. And we really believe that any metrics or destination should be about giving our members a sense that they're doing a great job, really just giving them a virtual high five. It's a pretty meta concept.

 

Brynn [00:22:32] I think most of fitness fails is frankly, because fitness is inherently about doing things that are uncomfortable in the present with the promise of delayed results in the future. Which is really hard. [Brynn laughs] So I think shifting kind of the focus to creating an experience that people love that makes them feel good in the present and then that likely will translate into a long-term results or changes. But it really is about getting people to show up and feel good.

 

Kinsey [00:22:59] Do you ever wish at times that maybe you could dedicate your life's work to something with a little bit more instant gratification?

 

Brynn [00:23:07] [Brynn laughs] On hard days, maybe, yeah.

 

Kinsey [00:23:09] Can't we just sell like tablets or something? Wouldn't that be so much easier, though, Candy? OK, so we will talk more about Mirrors, kind of experience and what comes next in just a second. But quickly, let's take a break to hear from our partner. — And now back to the conversation with Brynn Putnam from Mirror. So we mentioned at the top of the conversation that you started first working on this product in 2016. It is only 2020. It's not a very long lifespan of your company so far. But from the beginning, did you ever set out thinking, we want to IPO, we want to get bought, or we want to become the next great American company? What was your strategy from day one and has that strategy evolved?

 

Brynn [00:23:52] Our objective from day one has always been Mirrors in every home. What that looks like from our business perspective in terms of an exit has been less relevant to me than sort of the impact that I hope to have at this business. I spent 10 years building my first business and built, I think, a really wonderful workout product and experience. It was really only able to impact kind of my local New York City community. And so really this time around, it was thinking about what are the components of a business that scale? Because I wanted to have an impact that was big. How that translates on the business side has been less of a focus.

 

Kinsey [00:24:31] The idea of scalability is really interesting to me—that we think about the kind of capital intensive products like a restaurant or something like that. That takes a lot of money to build a gym. You know, your typical fitness club, obviously takes probably even more than that. A ton of money to build. That's a ton of real estate. But that that you can make one product and use this tech platform to then scale it without those costs is really interesting. And I imagine something that investors have been keen on.

 

Brynn [00:25:01] Absolutely. I mean, when you build a gym, most people work out before, after work. And generally you have 15 to maybe 30 spots that you can fill during those given hours. So the amount of unique individuals that you're able to reach is really small versus technology—one of my incredible instructors can spread their knowledge to hundreds or thousands of people in one class. So it's just a much higher impact business model and frankly, I think more rewarding to run.

 

Kinsey [00:25:33] Why do you think that there has been so much interest lately? And I know that we've kind of talked about part of this is just that we have better tech now. But why do you think there's been so much interest in companies like ClassPass, Peloton, SoulCycle Flywheel in recent years? More so than in previous decades.

 

Brynn [00:25:49] I think some of it was, frankly, the boutique fitness boom. The idea that fitness historically has been sort of a side gig for people, myself included. It was something that actors, models, dancers did on the side. It wasn't an industry that really attracted someone's full-time focus or high-level professionals. And then the boutique space demonstrated that it could be a truly profitable big business. And as a result, more talent, more attention, more investment dollars went into the space. And then I think the next question was just how do we take the learnings from that space and scale them to a broader audience?

 

Kinsey [00:26:22] It's interesting because I feel like for so many different industries, the opposite would be true, that a boutique is an offshoot, not the thing that kind of, is the impetus for all of this incredible growth. It's wonky to me. Yeah, but. But cool. OK. So when you think about the valuation of a lot of these companies, I think the argument that was often made around the Peloton IPO, which wasn't successful right away, you know, it stumbled a bit, Peloton did, before shares and now they're up something like 20% from their IPO price. But a lot of people said that this is because it's a fitness company that's being valued like a tech company. Any comment on the valuations of these sort of fitness boutique techie media e-companies when they reach the sort of judgmental public markets?

 

Brynn [00:27:08] Yeah, I mean, I think that the market likes certainty and some of these businesses are not easily classifiable, you know, is it an ecommerce business that sells bikes? Is it a hardware business? Is it a software subscription business and a media company? And Peloton didn’t neatly fit into one category or the other. So I think there was some amount of sort of stabilization that needed to occur during the IPO.

 

Brynn [00:27:34] And it's something that we frankly think about a lot. But I think that, you know, no matter what. When you sort of hit the public market—to get a private valuation, you have to like fool one person one time [laughs] and to get a public valuation, you have to fool a lot of people all the time. So the bar is definitely raised and the standards are quite high.

 

Brynn [00:27:53] I imagine it's helpful, though, that you can at least call yourself a SaaS company—software service. They have been rewarded much more handsomely in public markets than something like a bike. [chuckles]

 

Brynn [00:28:05] And I think many of SaaS friends would be pretty excited to be getting $40, $50, $60 a month from their members. [chuckles]

 

Kinsey [00:28:13] Yes, I imagine they would be. So when we think about the health of public markets as a whole, do you think that they will be friendly to more IPOs like this? I mean, I know SoulCycle put off plans for an IPO, citing market conditions in 2018. Is that something you would see happening again if, say, Mirror—tomorrow, we're ready to go public?

 

Brynn [00:28:33] Yeah, I mean, I think the market is about comps and we're obviously very grateful to Peloton for creating, you know, sort of the first comp in the space. And I think there will there will likely be more. But, you know, you definitely have to hit the fundamental mechanics of what makes a good business, you know?

 

Kinsey [00:28:48] Do you ever worry about the recession or any coming recession?

 

Brynn [00:28:52] You know, I built a very large boutique studio chain in the middle of a downturn. And I think people prioritize spending and health and wellness as a category where people continue to prioritize, especially when times are not as good.

 

Kinsey [00:29:07] Even if their discretionary income is shrinking?

 

Brynn [00:29:10] Yeah, I think so.

 

Kinsey [00:29:11] Okay. So now we will go to our famous wheel—I have it out here—hit the middle button, and we'll take it for a spin. — And, OK. Call me crazy. So what is your hottest take, Either from a pastime that has been correct or something that you believe right now that you are in the minority, you think people will call you crazy for? A hot take, anything like that.

 

Brynn [00:29:35] Oh, wow.

 

Kinsey [00:29:18] Doesn't have to be about your specific line of work. [laughs]

 

Brynn [00:29:44] I think I'm sticking with my area of expertise. I always sort of answer when asked what my favorite workout is, it's the table pushaway. That's usually my favorite workout. [Kiney and Brynn laugh] And for the majority of people, the level of sort or physical change or transformation, particularly when it comes to fat loss that people want, is generally best met by dietary changes more so than exercise.

 

Brynn [00:30:13] Exercise is certainly a component, but exercise without the sort of attendant dietary changes is likely not going to get you where you want to go.

 

Kinsey [00:30:20] Interesting. So it's not a lie when people say abs are made in the kitchen?

 

Brynn [00:30:23] Absolutely.

 

Kinsey [00:30:25] All right. If that's all you get from this episode. OK. Take another spin around our wheel here and we're going to get—looks like—Rapid Fire. What do you think is the most overrated fitness trend?

 

Brynn [00:30:43] I mean, I think the shake weight remains strong as an example here. [laughter]

 

Kinsey [00:30:46] That one will go down in the annals of history. The best informercial of all time.   

 

Brynn [00:30:57] No matter how many crazy things have come out since then, I think that visual image is probably as strong.

 

Kinsey [00:31:00] OK. Next: Rapid Fire. How many times do you work out per week?

 

Brynn [00:31:03] I work out two to three times per week. I work out much less now than I ever did as a professional dancer or fitness professional. Partially the result of having a small child and a growing business. And I think also because, I think the reason that I work out has shifted over time. So for me, it's shifted from being the thing I do for my job to something I did for a very specific fitness results now, something I do to have a little bit of quiet [laughter] from my life there.

 

Kinsey [00:31:31] OK. And last Rapid Fire: worst class you've ever taken.

 

Brynn [00:31:38] [laughter] Freshman Russian language, but I know that's not.

 

Kinsey [00:31:45] You know what? Oh, okay that’s good. And one last thing around our wheel to close it out. Let's see what we're gonna get. — It’s —In or out, are you in or out on wearing wearable fitness trackers for everyday life in any fitness tracker you prefer? Apple Watch, Fitbit.

 

Brynn [00:32:08] I think fundamentally fitness trackers are about giving people a simple metric and one that they can feel success around. So the 10,000 steps to me is just a simple way to move more during your day and something that shouldn't be really discarded as a tool for those who can use them.

 

Kinsey [00:32:31] OK. Well, that answers everything. Thank you so much for coming on Business Casual. Really appreciate it. And I had a blast talking to you.

 

Brynn [00:32:37] Ditto. Thanks for having me.

 

[00:32:39] [sound of coffee being poured]

 

[00:38:41] [outro music starts]

 

Kinsey [00:32:42] Thank you so much for listening to this week's episode of Business Casual. Next week on the show, we are bringing you the biggest crossover event of the decade, or at least since we did our decade in Review podcast. In honor of Valentine's Day, Morning Brew is celebrating with what we are calling merger week. We're dedicating an entire week of content to mergers and acquisitions. What makes them work and what makes it all fall apart? And Business Casual will be doing its part by bringing on Dan Primack from Axios. Dan is a verified M&A expert and the creator of the pro rata podcast and newsletter. I'm really excited to speak with him.

 

Kinsey [00:33:16] And speaking of love being in the air, I would love if you would hit subscribe on your platform of choice and leave us a rating and review. And in the meantime, have a great day.