Dancer to workout queen: How ClassPass became a multimillion-dollar business

SHE was a dance lover with a fear of new workout classes. Then she founded a multimillion-dollar fitness business that’s taking off.

MANY little girls grow up loving ballet. And many become women who still want to dance, or run, or stand on their heads, but are slightly afraid.

Payal Kadakia was one of those women.

The New Jersey-born Indian American was passionate about dancing, but had entered New York’s corporate world, just as her parents wanted. One day, she was trying to find a ballet class and became overwhelmed with frustration looking at different websites trying to find somewhere to go. “It was a miserable experience,” she says.

That day, she gave up, but an idea was born.

Fast forward seven years, and the 34-year-old’s ClassPass fitness subscription business is a global phenomenon valued at $US470 million ($600 million).

“In the beginning, the person I was trying to build a product for was someone like me,” she told news.com.au ahead of her July trip to Australia, where the workout class app has been a raging success. “I was scared to walk into a bootcamp class, I didn’t know where there was a yoga class near me. I do think a lot of people feel, even if you fall off working out for a couple of months, you get scared again.”

The 34-year-old says the key to success is focusing on strength and confidence and beating your fear — just as it is in fitness. Picture: Philip Sinden for Vogue Australia

And Payal had to overcome a string of setbacks — even failures — before her tenacity paid off. ClassPass started life as a workout class search engine called Classivity, and it didn’t work. “We had press, but the product wasn’t working,” she says. “I felt like a fraud. It wasn’t a real product. I went through having to downsize my team, get an engineering team to build a new product. Sometimes you have to make difficult decisions for your company. You can’t be scared.”

The product was reborn as the ClassPass app, where users pay a monthly fee and can attend a range of different boutique workout classes and gyms — from pilates to underwater cycling to spin/yoga fusion classes. It was a huge success, and has now launched in 39 cities around the world, with more than 30 million reservations made at 8900 studios since 2013.

But there were further hiccups. Costs rose as people took more classes, and a slew of copycat competitors added to the pressure. In November, the business dropped its unlimited classes option and users were furious. It now costs $99 for 10 classes per month (visiting the same studio up to three times), $60 for five classes or $40 for three. “We simply couldn’t make the plan work for our business,” Payal explained at the time.

It doesn’t seem to have done the company too much harm at present. ClassPass this month raised $70 million in funding, albeit at a lower share price, increasing its valuation from $460 million to $600 million.

The MIT (Massachusetts Institute of Technology) graduate says what’s most important to her is that people go to classes and enjoy fitness. “No one works out and feels bad after. It’s personalised, social and feels like an experience. It’s less, ‘Oh my god, I’ve got to work out,’ you go to do something. Let’s make it exciting.

“Having variety in your fitness routine is good for your body. Four years ago, I didn’t know what a plank was. Now I can hold one for up to five minutes. I go to barre class, bootcamps, dance, cardio, trampoline class and reformer.

“I do think people are scared to try new things.”

The former corporate consultant gave up her business suits for a more creative life working on a fitness app — and the gamble paid off. Picture: Philip Sinden for Vogue Australia

Fear is a big theme for Payal, who believe this is what holds people back from getting to where they want to be. But when I wonder if this applies most pertinently to women, she turns it around. “Try not to make it about gender at all. All you can focus on is your strength. Do whatever you need to be confident.

“Early on, I’d wear business suits to meetings, and it wasn’t me. I started wearing my Lululemon leggings and it was more natural. The best thing I can do is be me in any room.

“You have to set yourself up to succeed, no one’s going to do it for you.”

Her words could apply to business, fitness, or even technology, three major reasons she will speak at the second annual Vogue Codes event next month.

She recently stepped down as CEO of the company she grew alongside Mary Biggins — whose subscription healthy lunch service MealPal is about to launch in Sydney — but it was another power move, as she moved into a new role as executive chairman.

The team is working on the social side of the experience, with a new feature that allows users to co-ordinate with friends. They’ve also added a video on demand feature so people who don’t live in urban areas can try a range of classes too.

“I’m not just at meetings, I work with the design team, the product team, I’m always running around,” she says. “I’m a lot more in a creative place.”

HOW AUSSIES WORK OUT (Source: ClassPass)

• The most popular weekend workout time is 9.30am — earlier then the rest of the world.

• The most popular weekday workout time is 6.30pm — later than the rest of the world.

• The most popular class is Yoga Open 30C at BodyMindLife.

• Yoga is by far the most popular category, followed by Barre classes and Gym.

• Top three requirements are “good-for-all-levels”, “friendly” and “welcoming”.

• Top three most challenging rated classes are AGOGA, Physicore, and Barre Body.

Payal will be a special guest speaker at the VOGUE CODES Summit (July 28) and VOGUE CODES Live (July 29). For more info and to purchase tickets head to vogue.com.au/voguecodes

[e-mail] | @emmareyn

Originally published as Dancer to workout queen: How ClassPass became a multimillion-dollar business