The Exchanges

Q And it's, okay, so Julie, you were at 200 bucks a week, and Elizabeth, did you, did you guys have any money?

A Um, I had, I had bought a little studio apartment, and I had recently sold it, So I had about a 100,000 dollars. And then Alan, my husband, had a great job working at this investment bank called Lehman Brothers. Um, and so I said to him, I said, I really want to start this business. And he said, I, I get it. If you want to do it, I, you know, let's, we can do it. So we took 250,000 dollars, um, and, and started, and started SoulCycle with that. And we built the studio out inexpensively. Uh, we built a, a website, you know, reasonably inexpensively. I feel like we got a lot done for 250,000 dollars. Yeah. And the worst thing that could happen was that in five years, Julie and I could look at each other and say, you know what, we tried it and it didn't work.

AI assessment note: “I had recently sold it, So I had about a 100,000 dollars.”

Q Okay, so it's, I guess, around And you guys decide to open up another studio in New York in Tribeca. But I mean, I mean, this was 2008. This is the start of the recession. So where did you get that money to expand?

A Yeah, it was, it was interesting timing. So a couple things happened. One, um, I checked the bank account after Lehman collapsed, and I was, I mean, Alan and I share funds, and I was so proud of him, because he had, he had sold, you know, when stuff had vested, he had sold it, and so I was like, oh my god, there's money in the bank account. It's so awesome, because Julie and I need some cash to open Tribeca, and I want to borrow 600,000 dollars, and he was like, What are you talking about? I've had, like, the worst month of my life. Are you kidding me? And I said, no, I'm super not kidding you. I'm going to pay you a huge interest rate, and you are going to lend me that money. I tried, to be honest with you, I tried to get money from other places. I had a friend that I grew up with that ran a private bank of one of the big, big banks in New York, and it was after the collapse, and the Feds are funding these banks, and I said, I need a credit line of three million dollars. I can start with a million, but I need three. And they looked at me and they said, okay, well, if you put up for collateral your apartment and equities that equal the same value as the amount of the credit line, then we will lend it to you. And I was so furious. I said, how dare you do that? My taxes are funding you right now. I am not asking for that much money. We are running ten million dollars of cash from…

AI assessment note: “I want to borrow 600,000 dollars, and he was like, What are you talking about?”

Q going to make it different? I mean, I know You talk about community, and, and, and I, I get that, but, but specifically, like, was the music gonna be different? Was the, were the lights gonna be different? Was the, the, the, the design, the, like, the experience, how was the experience going to be so different that people would have to go to SoulCycle because they just needed it?

A Well, the first thing was that we were going to have technology so that people could, it was 2006, so this sounds crazy to talk about now, but there were very few booking apps out there, if any, and we felt that in order to become part of someone's life, we had to help them plan their weeks. So we worked on this booking app. You could get on your computer at noon on Monday, and you could sign up for your classes for the week, and in that way you would know what you had to look forward to. The second part was the people who worked at the front desk were trained to remember your name, to ask about your vacation, to remember if you liked your water, room temperature, or cold. We wanted people to cross the threshold of, of, uh, the studio and feel like they had gone from the crazy, you know, world of hustle that is New York City, and that they had walked into a place that was fun, that was a sanctuary, and that was a place that welcomed everyone.

AI assessment note: “The first thing was that we were going to have technology so that people could”

Q Is it weird to walk down the street in some city and see a SoulCycle and, uh, I don't know, know that it's not yours?

A For me, every time I see a SoulCycle, I still feel like it's a love child, and I feel proud of, I feel proud of the, of the energy that I know is contained in those rooms, and what it, what it does for the people who opt into that experience. I will say that there are those who said to me when we were getting ready to, to do our original deal in 2011, um, you know, selling a business is not like selling a child. I mean, You have children. This is your business, uh, in a very detached way. And I will say that that is super not true. I obviously did no fact checking, uh, as to whether or not the person who said that to me or the people who said that to me had ever started a business because it is a child. Uh, in fact, I, when we were, when it's a funny story, we were, um, people, somebody was coming to us, uh, early on in the business and saying, you should franchise. And I looked at Julie and I thought, oh my god, we already have four children between us. How many children do we need? So we just kind of felt like SoulCycle, each one of the studios was like a child. And, and, and when we left, we, you know, we left a piece of our heart there because that's what you do.

AI assessment note: “every time I see a SoulCycle, I still feel like it's a love child”

Q show, famous entrepreneurs, but most people who listen are Are starting out, you know, or they're, they're in the middle of it. They're kind of grinding away. And I'm curious, if you had to go back to 2010 and you had a crystal ball, would you have said, let's try to just do this on our own and not bring in any outside investors? Let's, let's keep bootstrapping this thing.

A I mean, if there were two alternate universes, I would certainly play that out, but on the other hand, you know, we never forgot why we started the business, and like we said, we, we really started the business to create an environment for people that was like a secular sanctuary, where people could feel safe coming in there, and they could burn their cheesecake from the night before, or they could tap into something tribal on that bike, and that was why we did it. We never, ever, ever forgot why we did that. Sure, it would have been interesting to kind of play that out, but the thing is, on the other hand, the way that it did work out, we, we still got to do all those things.

AI assessment note: “if there were two alternate universes, I would certainly play that out”