How Peloton Became A $4 Billion Fitness Start-Up

You’ve got to pack your bag. You’ve got
to travel. The showers might be dirty or taken. Fitness classes. We’ve all got a
love-hate relationship with them. But Peloton is working to change that and
it’s created a movement. Peloton started when the founders wanted to solve that
common excuse we all use: “I don’t have time for the gym” We were gonna shift
this fitness industry from these commercial gym environments into the
most convenient place on earth. John Foley first came up with the idea for
Peloton as a busy dad living in New York. He and his wife couldn’t find time to
fit the SoulCycle and flywheel classes they loved into their schedules. Could
you build the platform that allow you to do that at home? Your convenience. Your
time. Your schedule. It turns out they could. Investors actually thought we were
crazy. Who builds their own bike? Why are you building your own tablet computer?
You’re gonna start your own broadcast studio and hire your own instructors?
They saw incredibly expensive business models but the founders say that
business model has been key to their success. The company has over a million
passionate riders. Celebrities. Athletes. Business leaders. Everyone started clipping into their bikes and tuning into the classes. There are fan
groups and podcast. And rider are self-proclaimed members of a cult. We’ve
seen users send us the Peloton logo permanently tattooed on their body.
People are pretty obsessed with Peloton, I myself included. A lot of that obsession
is thanks to the elite instructors, like Arzon, on who’d become global fitness
celebrities. The Peloton instructors are like a team of superheroes. I really
liken it to creating a team of like Avengers and we all come with our own
special skill set. You’re part DJ your part coach your part television host and
instructors are kind of breaking that fourth wall and in people’s homes that’s
really powerful stuff. Peloton has such a personal connection for me, specifically
Robin. When she is talking to that screen she is talking to me. Before I had my Peloton, I worked out about three or four times a week in a private gym with a trainer. And it was getting harder and
harder to schedule with her. That comes out for me to about $120 a month. Which is
really inexpensive compared to a private trainer for various sessions. Peloton has
been criticized for high prices and their elite marketing. A recent viral
meme mocks Peloton ad calling the company out for being bougie and
unachievable. We strive to find different entry points. The peloton bike on one of
our financing plans is closer to $50 a month. Peloton growth is impressive.
Investors have poured in nearly a billion dollars, valuing the company at
$4.15 billion. The company says it’ll reach $700 million in revenue in February
2019. And there’s a potential Peloton IPO rumored for later this year. The industry
has taken note. We have updates on Peloton competitors. Oh, sorry. “competitors.” Competitors have already jumped on the trend. Other at-home Fitness brands like
“Mirror” and “Tonal” have sprung up. And rival Flywheel launched a subscription
service to stream cycling classes. Prompting a 2018 lawsuit for Peloton
that claims the company copied its proprietary design, which flywheel denies.
Peloton is increasing its number and types of fitness classes and expanding
its reach. We’ve launched the UK and Canada. So now you can be riding a
leaderboard with people from the Isle of Man to Vancouver, Canada to Bozeman, Montana. And we think that can potentially unify people through fitness.
Since the beginning the founders had a vision. If they could control every
aspect of the business from designing and building the bike to developing the
software, training instructors, streaming music to delivering the experience to customers homes, that vertical integration could
lead to the company’s of lasting success. And Peloton has no intention of slowing
down. Dreamers who hustle are an unstoppable combination and that’s
literally the DNA of this company.

33 thoughts on “How Peloton Became A $4 Billion Fitness Start-Up

  1. Hype+VC Money = Overvaluation . VCs then get out with IPO, and pass the worthless company to pension funds +retail investors. <face palm>

  2. The reason Peloton will never truly succeed is because it is limited to biking and running. For those into strength training or other forms beyond just your typical cardio, Peloton can't touch that market. And your basic elliptical and treadmill gets boring fast…

  3. Bike with a tablet and live training you still have to subscribe too – $2000. Looks cool though, it’s perfect for people who have too much money and don’t know how to spend it, I’d do the same

  4. They became a 4 billion dollar company through investors, because without them, the company was loosing money every year like mad. It is still losing money, but investors are really hoping they turn a profit from this company, which i really doubt it will happen.

  5. They have this big cage in the middle of Jordan Creek mall in Des Moines, and they never have any interest and the employees just talk to eachother all the time. I go there a lot and I’ve never seen them engaging with a customer that wanted to buy

  6. Millennials and Hipsters who follow trends like sheep with more money than sense. Constantly needing affirmation and validation from some moron on a screen or social media.

  7. why would people spend money on that?
    if you want atrain in your home you have fitness cds
    i go to the gym because of comunity expirience

  8. So you could litteraly buy a bike, and a tablet seperatly and still get the same stuff?… What a scam…. Why would you subscribe to this when you litteraly can put a free spinning class on tv and just use your 20 year old bike…

  9. There is no need to buy your wife this bike.. House keeping burns tons of kcal, wife should just do more cleaning in the house..

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