The Exchanges

Q Paul, I wanna, I wanna ask you about the inspiration, one of the inspirations behind ClassPass. I remember in the podcast you talked about being inspired by brands like OpenTable and, uh, and ZocDoc, which is a platform that connects patients to doctors. And your innovation was essentially taking A version of that concept and applying it to health and fitness, right?

A Yep. So, you know, ClassPass started because of my passion for dance, right? And I was always going to classes. I was always finding a way in my busy schedule. Like most people, I had a job that I felt like I was responsible to take after college, and I had to kind of go and do the normal thing, but I wanted to keep dancing. So I was that person who was always looking for classes and You know, to fit between my lunch break, or fit after work, and one day for me, I hit that moment where I realized that technology could really solve this, and I was really inspired by companies that had sort of already done this offline to online model, right, so things like ZocDoc, OpenTable, SeamlessWeb, and this was 10 years ago, so I feel like there's so many more now, obviously, in the breadth of this, uh, but at the time, I remember looking at those companies, And realizing that, hey, why couldn't I do this for the class space? You know, it's, it's a very similar, ah, model where people need to go and do something, it was inefficient, ah, people need to book appointments, and if we could solve this via technology, I quickly thought that because this worked in another industry, it would work in mine, but I was very easily proven wrong.

AI assessment note: “I was really inspired by companies that had sort of already done this offline to online model”

Q So you, so Sam, this trip to San Francisco clearly inspires you to sparks an idea in your head. And where do you go back to? You come back to New York?

A So I come back to New York, correct. So I take a red eye, I remember, on Sunday night, and, um, I remember thinking to myself, you know what, Pyle, like, why don't you give yourself two weeks to think of an idea? And, hey, if you think of an idea, maybe entrepreneurship is the right way. If not, okay, maybe it's time to, you know, look for another job in corporate America. So, um, I'm studying ballet at the time. I was going to class obviously a ton. I wasn't, we weren't in active dance phase at the time, but I was obviously still training. So on the Tuesday after I get back, I, you know, get on my computer. I have my ballet clothes with me. I start looking for a new class to take. I end up with, you know, seven tabs open. I'm looking at the schedule. I'm looking at the teachers. I'm looking at the times and it's all over the place, right? The formats are different. I'm Kind of getting lost between, you know, the times and the subway I need to take. And by then, it's been two hours, and I've missed class, and I don't go that day. And that's when it hit me. I realized, oh my god, this is a disaster. This information is all over the place. What if technology could help people put this all in one place for them to be able to, you know, continue to do their passions and go to class? That was the initial moment for me.

AI assessment note: “So I come back to New York, correct.”

Q And so, you've got customers, and were you getting a lot of customers? I mean, what was a lot? Was it, like, getting thousands and thousands of people signing up?

A No, this, this was, I mean, we had a total of about, uh, 2000 customers on the passport before we pivoted to ClassPass, so we're, you know, we're getting there, like, in the sense of, you know, the chart was starting to go up, but we had a problem that still needed to be fixed, even though all these, you know, moments were great of people starting to talk about us and tweet about us, we still needed to do more work, so this is when We started to test out a monthly subscription. So in June of 2013, we sold, um, a ClassPass model where we let 50 people come on and try, you know, try this out on a more monthly, uh, basis.

AI assessment note: “we had a total of about, uh, 2000 customers on the passport”

Q Like local competitors? Like, uh, like some company would just decide to, to, like, aggregate a bunch of studios or gyms in a city and then offer packages to, to users?

A Yeah, so now I'm dealing with multiple things happening at the same time where I can't really change my pricing because all my competitors have copied my same product, right? So everyone has an unlimited product now in the markets. We obviously were the front runner because we had started the business and we were raising more money. I mean, by the way, six months after my series A, I raised a forty million dollar series B, right? So just think about how quickly that scaling and that growth is. And even in terms of numbers, At, when 20 14 started, and we started, ah, projecting how many cities we would be in, we thought we'd be in eight cities by the end of the year. And in September, once we launched our, or we announced our Series A, and all these competitors came out, I remember thinking, we need to go much quicker. This is not gonna work. We're gonna lose some of our markets. We need to win. And we started this, ah, project as a team. We called it Operation 20 15, Which meant that we wanted to be in 20 cities by the end of the year, right? So, so this was launching 12 extra cities in a matter of three months. And so we hired, like, 60 people that weekend. It was absolutely, like, one of the quickest things we had ever done. We literally, like, bought tickets for people to go into these cities. We trained them. Um, they went in. We launched all these markets. And we did it. B…

AI assessment note: “Yeah, so now I'm dealing with multiple things happening at the same time”

Q So how did you, how did you get super into Indian dance? I mean, because it sounds like, because this is something you did, and we're going to talk more about this, but something you did throughout school and into college, like what, what was it about Indian dance that just really kind of drew you in?

A So in India, there were, at that time, I mean, it's called Bollywood now, but it was called, um, the Hindi, you know, film, Hindi films, and there were actresses like Madhuri Dixit and Sridevi, who were, you know, these unbelievable actresses that would dance in these movies, and, you know, to me, they were like goddesses, and they, um, you know, like emulated this power of expression and, uh, charisma that, you know, I think as an Indian artist, Girl, I would sit in my house, and I literally would put the video on over and over and over again, and try and emulate it, and I think for me, what I started realizing with Indian dances, it was this way for me to feel connected to where I came from, especially because I was around people who didn't look like me, and it also became this place where I felt really confident. Um, I became this performer when I was, you know, very young. I, I remember Since I was five, I performed at every family function or party. Um, like I would have to have like my cassette ready, my dance outfit ready, you know, and I think that that was really important for me to find a place where I felt alive. I felt like I could touch people. And I think when you're that young and you realize that you have the power to affect other people, it changes you at a very deep human level. And I think that's really what happened to me.

AI assessment note: “actresses like Madhuri Dixit and Sridevi... it was this way for me to feel connected”

Q And what about school? Was it pretty, did it come pretty easy for you?

A I would say, um, education was a very important pillar of my childhood. Getting good grades was sort of a non-negotiable. I had to work hard to get good grades though. It wasn't, I don't, you know, I think there's people in the world who are sort of just like great at getting, you know, getting through school and didn't have to study and would just like ace the test. That was not me. I had to study. It was actually interesting. English and writing were just harder subjects for me. Uh, maybe because of, you know, my parents, you know, didn't always speak English in the house, um, but, like, math and science, it just was so, was easy for me, and I loved it, and I used to, um, always even, like, think about how my life revolved around numbers, and actually did my entire college, uh, application essay on how my life revolved around the number two, so.

AI assessment note: “I had to work hard to get good grades though. That was not me.”

Q So you're, um, kind of thinking about this, but then what's the next step? I mean, you still had a job at that time, right?

A Yeah. So I, I'm still working for Warner. I start, you know, once again, doing some research, looking at these adjacent models, um, Uh, I start doing some, you know, a little bit of qualitative research with my friends. So I start telling them, you know, hey, I want to build this idea, like an open table for classes, which by the way, sounds pretty good, right? To anyone. Um, it sounded, everyone was like, that sounds great. I would do it. And I am, by the way, the name of the company at the time was called Dabble, uh, Dabble Now, because that was what I thought the company would be. I thought it'd be like a place where people could dabble in different classes.

AI assessment note: “I'm still working for Warner. I start, you know, once again, doing some research”

Q saying that you were kind of back in startup mode, which was kind of exciting. You said, you know, um, uh, you were trying all kinds of things. You were thinking about maybe cooking classes or offering comedy classes, and, and you told me you were kind of throwing things at the wall to see what might work. What, what were some of the things that you, you guys tried?

A Yeah, we had different, you know, live experiences we were trying. So, you know, we saw people like wanted to do magic at home and different experiences that people were still doing, but they were finding ways to bring them to, you know, their homes, right? Obviously with a small group of people. And so we started looking at that. Um, we just saw that it wasn't exactly as scalable. Uh, we had obviously done a lot of video innovation and testing, which, you know, stayed on the platform, um, Um, and then the other one, which actually did stick, which was something a part of something we had actually tried right before the pandemic was we went into beauty and wellness and that actually ended up sticking because what we realized is people were more comfortable with more of that one-on-one experience versus the group experience, which comes more in beauty and wellness. So we actually saw that take off more than we thought. And we did end up investing a bit more in the wellness category of our business.

AI assessment note: “we saw people like wanted to do magic at home... we went into beauty and wellness”

Q know that you weren't necessarily losing sight of the vision, and how did you know what it meant to stay on track? Because I'm sure a lot of people watching right now are like, yeah, I, I'm not sure if the thing I'm doing is Exactly. Right. But I'm not sure if I should change it too much. I just don't know what to do. So how did you know?

A Such a great question. And it took me, I wish I knew this answer earlier. It took me three years to figure it out. The thing that mattered the most was getting someone to class. That's all that mattered. Cause that was the mission. That was engagement. That was revenue at the end of the day. It was the leading metric that would tell me how my product was working. If my partners were happy, but I didn't know that in the beginning, right? Because in the beginning, everyone tells you to create a business model, and you're looking at revenue, you're looking at profit, you're looking at cost, like, you don't know exactly what number to focus on, and over time, and I, and I still always make this the most important number that my team sees, it's the reservation number, because that is the heartbeat of the company. That means our product is working. That means our partners are happy. That means our customers are engaged and are going to continue to pay us the following month if they're going to class, right? So To me, it was about figuring out what that metric is, and it kind of goes back to, like, that question I was thinking about earlier whenever I asked somebody, you know, what problem in the world are you solving? How will you know when you've solved it, right? So what's the action your customers are going to be taking? So it took me a little bit to figure it out, but for me it w…

AI assessment note: “The thing that mattered the most was getting someone to class. That's all that mattered.”

Q Would you describe yourself as, like, shy and quiet, or would you describe yourself as confident as a, as a girl, a young kid?

A Yeah, it's actually pretty interesting. I was pretty shy and quiet, and I think that was a dynamic of my family. Like, my mom and my sister were both very, like, loud, dominant personalities. It actually took me until, I would say, going to college, where I started realizing what a leader I was, and how, you know, what my voice was, and how to, Sort of take control of situations, because I was, I was the baby of my family, and even within all my cousins and everyone, like, I was a baby, and I also, I know we're, we're talking, um, you know, over, over this microphone, but I'm four 11, and I was never very tall. So, um, you know, I was always a small person, and so I had to really find a way to come out of that, and I started really realizing that once I went to college.

AI assessment note: “I was pretty shy and quiet, and I think that was a dynamic of my family.”

Q Yeah, so how, how did it start? Like, what, what did you do?

A So in the summer of 2010, I went out to San Francisco. I met a bunch of entrepreneurs because, uh, it was one of my friend's birthdays, one of my former MIT and Bain friends, and all her friends were building apps and ideas. And in 2010 in New York City, I could not count, you know, I didn't know that many entrepreneurs, right? Most of my friends were in finance banking or fashion. So I, you know, go and talk to them about these ideas. They're telling me about what they're building. I mean, some of them weren't even great ideas, but I remember thinking to them and asking them, I'm like, you do this full time? And they said, yes. And I was, it was sort of this new idea for me. Like, and it made me think about this life of entrepreneurship and what if I could really blend, you know, my creativity with my business skills and build something as well.

AI assessment note: “So in the summer of 2010, I went out to San Francisco.”

Q But, but then I guess the question is, why would they pay 49 bucks for it if they could have just done it individually for free?

A It just was an easier booking experience, right? I mean, that, that's like where technology really, I think, in our lives started coming alive. It's like, sometimes it's easier to call a cab than, than Uber, but you still do Uber because it's like in your phone. Right. And I think it was, it was sort of that type of experience of people, uh, just saying, oh my God, this is all in one place. And, you know, we made it all so easy, right? Like we would give information, we would get, have photos. It just felt more accessible to people in the way we were also presenting the information. And it felt exciting, right? To say, hey, like, let me sign up with my friend and we'll both do it together for a month. You know, it just felt like you were going on a journey together, and this kind of brings me back to having a value proposition and not just it being a search engine.

AI assessment note: “It just was an easier booking experience, right?”

Q And did you get there? Did you get to, to that point?

A Yeah, we got there. I mean, when you look back at the curve, right, that we started seeing, um, I mean, It just, the numbers were exponential, right? We just started doubling, and then we were tripling, um, the amount of people sort of signing up for ClassPass, talking about ClassPass was exponential and viral, right? And all of our marketing outside of this Lululemon promotion, uh, really came from people telling each other about it. So we would do a lot of, you know, referral tactics and referral marketing, and it was very much a product people wanted to do with their friends. Yeah. It was a million dollar run rate that we wanted to achieve by January, and this is basically the advice I had received was, you know, once you get to a million dollar run rate, you'll be able to raise your Series A, right? That was sort of what I had heard in the market at that time, because, by the way, I had gone out to Silicon Valley three times already.

AI assessment note: “Yeah, we got there. I mean, when you look back at the curve”

Q years at that point, and you said, you know, we've been through so many ups and downs, so many crisis points that I kind of, I'm almost ready for this. You know, and I was, I was impressed when you said that, because it was a, it was a crisis moment, but did you really feel that, or was there a part of you that was kind of freaking out?

A I just knew that we were going to figure out a plan. You know, I think with the people that were a part of my team, right, the, the investors I had, I just knew that there was going to be another side of this, and here's the one thing I've really fundamentally always believed, is the platform we built at ClassPass was here to stay, right? We had changed human behavior, and, and I knew this, right? I think I may have spoken about this before, but, When I went out to Singapore and I saw people working out, right, or going out to Hong Kong or Australia, and I realized that we had built a product that wasn't about, you know, one demographic or wasn't a trend. It was literally about changing human behavior.

AI assessment note: “I just knew that we were going to figure out a plan.”