BODi, formerly known as Beachbody, the OG of subscription health and fitness systems, expects positive cash flow in Q1 — the first time since 2020 — following a “transformational” 2023. The company just released its financial earnings, reporting a total revenue of $119.0 million in Q4 of 2024, compared to $148 million in the prior year period. Total revenue for the full year 2023 was $527.1 million, compared to $692.2 million in the prior year.

Despite the seemingly lackluster financial results, BODi’s executive team tells Athletech News they’re bullish on the company’s future, driven by a focus on improving cash flow and leaning into digital fitness and holistic wellness content, including an embrace of GLP-1s.

The company known for its high-energy fitness coaches such as Autumn Calabrese, Shaun T, Tony Horton and Shakeology protein shakes, underwent a major rebrand from Beachbody to BODi last year, adopting a more holistic approach to health and wellness. The move also included a major declaration from Carl Daikeler, the company’s co-founder and CEO: “Beachbody is dead.”

In place of the old and tired diet and fitness industry playbook, Daikeler explained his vision for the future — one in which a positive mindset was woven into the health and fitness experience, combatting what he called a “permanent dissatisfaction” that many consumers experience.

It’s not a quick fix, especially in a highly competitive industry, but BODi is encouraged by early results, including high search traffic volume following its makeover. Reflecting on 2023’s earnings, Daikeler says BODi’s self-described “turnaround plan” has been successful so far, with the company lowering its breakeven point and enhancing its liquidity.

“In 2024, our objective is fostering more profitable revenue streams and sustainable free cash flows, with a renewed focus on reshaping our nutrition business,” Daikeler said. “Our accomplishments in 2023 set the foundation for continued execution of our turnaround in 2024. We expect to have positive cash flow from operating activities and free cash flow in the first quarter.”

BODi has also offloaded its Van Nuys, California, production facility for $6.2 million, using the net proceeds to make a partial prepayment on its $5.5 million term loan.

BODi’s Financial Overhaul

Mark Goldston, executive chairman of BODi’s board of directors, partnered with Daikeler last year to guide the company’s transformation, drive profitability and unlock growth opportunities. He also serves as chairman and CEO of The Goldston Group and is a general partner of Athletic Propulsion Labs, a high-end performance athletic footwear company — lending his expertise to revitalize and reposition BODi back on its fitness throne.

“Since the start of the program, we are on track to achieve over $200 million in fixed costs and CapEx savings in 2024 over 2021, and introduced a more efficient sales and marketing model that aims to deliver a 1,000 (basis points) bps improvement in 2024,” Goldston tells Athletech News. “This dramatically lowers the revenue breakeven for the company. By building operating leverage into the P&L, our dramatically lower cost base has the potential to generate strong incremental profitability when we return to revenue growth.”

Last year, the company also introduced a new “Growth Game Plan” that rewards high-performing network sales partners within its subscription health and fitness system.

King of Fitness Content

Touting its extensive digital fitness library of 134-plus programs with widely-known titles such as P90X, Insanity, 21-Day Fix and Lift More, BODi is leaning into its content offering, having refined its appeal.

“We think of BODi as being the ‘Netflix’ of the digital fitness industry, and we are doing a much better job of leveraging that library,” Goldston said. “That includes creating our first-ever free BODi Previews tool that features over 120 individual workouts and allowing even more consumers to enter into our community.”

Goldston also shared that BODi is expanding its retail and direct marketing business to bring the benefits of its fitness content and nutritional products to a broader audience.

“Our BODi digital fitness app was recently named the #1 workout app last year by CNN Underscored, so we’re being recognized for the impact we’re making for modern fitness consumers,” Goldston said.

Embracing Wellness & Weight Loss Drugs

Unafraid of GLP-1 weight loss drugs, BODi instead sees a significant opportunity. 

“With over 145 million American adults categorized as overweight and more than 75 million of those people considered clinically obese, the TAM for BODi is massive,” Goldston predicts, adding that many people who are considerably overweight may experience difficulty starting an exercise program and are self-conscious about going to a gym. 

“The GLP-1 drug movement is designed to address the 145 million people who are overweight, especially the clinically obese, and we strongly believe that those drugs will unlock a major TAM opportunity for BODi largely because a large group of people will lose enough weight to safely and comfortably consider starting an exercise program in the privacy of their own home,” he continued.

Goldston also referenced the need for GLP-1 users to maintain a healthy eating regimen, which he sees as a major “boon for BODI” in terms of its meal plans and nutritional supplement offerings. 

As for BODi’s fitness content, Goldston pointed out that the platform’s fitness programs can help offset the loss of muscle mass. 

“The GLP-1 drugs have been known to have an adverse effect on lean muscle mass, and therefore, the use of programs like those contained in the BODi library will help reduce the risk of losing lean muscle mass and help people maintain and gain strength while getting their weight under control and improving their overall level of fitness,” he said.

While BODi forges ahead, fortified by its vast digital fitness content and nutritional supplements, Goldston also sees the subscription health and fitness system taking center stage to meet an even bigger trend.

“I believe that the industry has truly embraced a more holistic approach to fitness,” he said. “While there is no easy fix to maintaining a healthy life, there are benefits to a balanced approach. Consumers continue to look for guidance and that is a fundamental core principle of our approach at BODi. At BODi, it’s that balanced approach that makes us unique.”

This article has been updated.

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In the first full year of post-pandemic life, the fitness and wellness industry has seen its fair share of headlines, both positive and negative. 

While dealmaking has cooled off some from its pandemic-era high, there still were plenty of major fitness and wellness moves in 2023, including brand partnerships, nine-figure funding rounds and celebrity endorsement deals. 

Athletech News recaps the eight fitness and wellness moves that defined 2023, and forecasts what each could mean as we enter a new year.

• 

  1. Peloton, Lululemon Strike Content & Apparel Partnership 

  Two of the biggest brands in the fitness and activewear categories joined forces in a major way in 2023. As part of a five-year global partnership, Peloton agreed to create exclusive digital fitness content for Lululemon Studio, while Lululemon became Peloton’s official apparel partner, creating co-branded clothing for instructors and fans. 

  Why It Matters:

  The deal marked the final nail in the coffin for the Mirror, Lululemon’s ill-fated piece of connected fitness hardware that never quite lived up to its $500 million price tag. Lululemon announced it would be officially discontinuing Mirror, instead pivoting fully to Lululemon Studio, its digital fitness platform which now gives members access to Peloton’s library of workout classes. 

  For Peloton, the deal shows the connected fitness company’s commitment to becoming more than just a “bike company,” as it looks to offer different types of fitness content, from yoga to strength training, in addition to spin classes. 

  What To Watch in 2024:

  While Peloton has built a large following of dedicated fitness fans, the jury is still out on whether the company can successfully transition from being a cycling-focused brand to a one-stop shop for diverse fitness content. Providing content for Lululemon Studio will expose Peloton’s workouts to even more people around the world, potentially helping the connected fitness company make good on its bold expansion plans.

• 

  2. WeightWatchers, Life Time & Xponential Make GLP-1 Moves

  For better or worse, the weight-loss-drug era is officially here. GLP-1s like Ozempic and Wegovy are flying off the proverbial shelves as consumers seek access to the drugs, which have been celebrated for their proven ability to help people lose significant amounts of weight in a relatively short period of time. 

  WeightWatchers acquired telehealth brand Sequence in early 2023, a move that signaled the weight loss company’s shift from a food-based approach to adopting prescription drugs including GLP-1s. WeightWatchers still offers its famous Points Program, but the company has made weight loss meds a core part of its offering. 

  In the fitness realm, brands including Life Time and Xponential Fitness are embracing weight-loss drugs. In November, Life Time launched its first Miora Longevity and Performance clinic, offering members access to GLP-1s such as Ozempic under medical supervision, in addition to a host of other wellness benefits. 

  Xponential, meanwhile, announced its intention to acquire Lindora, a metabolic health brand with clinics offering weight-loss medications. Xponential plans to rapidly scale the brand through franchising. 

  Why It Matters:

  The deals struck by WeightWatchers, Life Time and Xponential show that at least some established fitness and wellness brands are willing to embrace GLP-1s, making weight loss meds an important part of their business strategy. 

  What To Watch in 2024:

  There’s still much to learn about the long-term effects of GLP-1s on sustained weight loss and other aspects of health. Some analysts predict that the rise of weight-loss drugs will lead to a corresponding rise in gym membership sales as more consumers become confident enough in their bodies to want to hit the gym; others have expressed skepticism about the drugs’ ability to spur meaningful changes in people’s fitness and wellness habits.

• 

  3. Apple Partners With Anytime Fitness

  Apple has been pushing further into fitness and wellness for several years now, with advancements in Apple Health and the launch of Apple Fitness+. In November, the tech giant inked its first deal with a gym brand, partnering with Minnesota-based Anytime Fitness. Through the collaboration, Anytime Fitness members across the U.S. and Canada will have access to an Apple Fitness+ subscription included in their membership at no extra cost. The two companies could take their partnership even further with more collaborations down the road, Anytime Fitness CEO Chuck Runyon has told Athletech News. 

  Why It Matters:

  The deal marks Apple’s firm entry into the brick-and-mortar gym space, potentially signaling a major shift in how the company will approach fitness and wellness in 2024 and beyond.  

  What To Watch in 2024:

  It will be interesting to see if Apple partners with any other gym brands, or if the tech giant is content to ride with Anytime Fitness and its network of 5,200 locations worldwide for the time being. For Anytime Fitness, can a partnership with Apple sway consumers to choose AF over rival low-price, high-value gym chains like Planet Fitness, Crunch Fitness and others?

• 

  4. Pvolve Inks Deal With Jennifer Aniston

  Functional Fitness brand Pvolve reached a new level of mainstream recognition and notoriety this year, partnering with celebrity A-lister Jennifer Aniston. The former “Friends” star will advise on Pvolve’s marketing, product and programming strategies, as well as star in Pvolve commercials, including a strength-focused ad campaign that launched in August.

  Why It Matters:

  While celebrity endorsements are nothing new for the fitness industry, getting a star on the level of Jennifer Aniston is uncommon, and it bodes well for Pvolve as the brand expands its footprint of brick-and-mortar studios through franchising. 

  What To Watch in 2024:

  So far, the partnership seems to be bearing fruit for Pvolve: the fitness brand reported a 650% increase in branded search and a 125% increase in franchise inquiries since partnering with Aniston. As time passes, we’ll see how much Pvolve leans on its celebrity affiliation as the brand continues to grow nationwide and even internationally.

• 

  5. Nike Launches Group Fitness Studios, Equipment Line

  Nike is no longer just a fitness apparel brand. In 2023, the Swoosh entered the brick-and-mortar space, opening group fitness studios in Southern California, with another location planned for Austin, Texas. In partnership with FitLab, Nike Studios offers functional training and endurance workouts led by expert instructors. The sportswear giant also pushed into the fitness equipment space, launching Nike Strength, a collection of strength training equipment including barbells, bumper plates, dumbbells and kettlebells, all of which feature prominent Nike branding. 

  Why It Matters:

  As seen with Apple, “blue chip” companies are increasingly entering the traditional fitness space. Nike clearly believes in the long-term potential of the fitness and wellness market, announcing it would hire over 1,000 global fitness trainers to lend expertise in creating holistic fitness content, programming and experiences, presumably as part of its Nike Studios endeavor. 

  What To Watch in 2024:

  Nike could make significant inroads into the fitness and wellness space if the brand is truly committed to the vertical, although it remains to be seen whether consumers will latch onto the idea of visiting a Nike Studio for their daily workout. On the equipment front, could Nike become a true rival to established strength training brands like Eleiko and Rogue Fitness?

• 

  6. Peloton Announces Rebrand, New Strategic Vision

  Back in May, Peloton announced its intentions to become the fitness company for “anyone, anywhere,” looking to shed its perception as a “bike company” focused predominantly on wealthy consumers. 

  As part of a large-scale rebrand, Peloton launched a new fitness app with three subscription tiers, including a freemium option that offers more than 50 classes curated across 12 modalities for no cost. The Peloton App One and Peloton App+ tiers cost $12.99 per month and $24 per month, respectively. The connected fitness company also launched Peloton Gym, which offers at-home strength training workouts. 

  Why It Matters:

  Peloton CEO Barry McCarthy has said that the company wants to branch out beyond cycling workouts, becoming a more well-rounded digital fitness company that makes most of its money through content rather than hardware sales. As a result, Peloton has forged partnerships with top sports teams and leagues, universities and even hotel groups as the brand looks to increase its global recognition and drive users to its app. 

  What To Watch in 2024:

  So far, Peloton has struggled to translate its rebrand into financial success. In its most recent earnings report, Peloton lost paid subscribers, with the connected fitness company struggling to convert free app users into paying members. Peloton has one of the most loyal fanbases of any fitness company, although many of those fans are cycling diehards. It remains to be seen whether Peloton can bring new members into the fold by emphasizing other types of fitness content.

• 

  7. EGYM Raises $225M, Preps for IPO

  In July, fit tech company EGYM received €207 million ($225 million) in growth capital, closing a financing round led by Affinity Partners, a global investment firm launched by Jared Kushner, the son-in-law and former advisor to President Donald Trump. The funding will enable the Munich-based EGYM to prepare for an IPO, the company’s co-founder and CEO Philipp Roesch-Schlanderer has said.

  EGYM provides smart gym solutions, including software and fitness equipment, for more than 15,000 gyms worldwide, and is rapidly expanding its North American team. 

  With the investment, EGYM will also focus on further developing its digital solutions for health-focused workouts and expanding the EGYM Wellpass corporate health network, an area Roesch-Schlanderer has identified as critical. 

  Why It Matters:

  Funding has been harder to come by in 2023 due to macroeconomic conditions, but Affinity Partners’ investment in EGYM shows the promise of tech-enabled fitness. With even more resources, EGYM looks poised to extend its lead as the dominant fit tech provider on the market, potentially reaching even more gyms worldwide.

  What To Watch in 2024:

  Will EGYM’s impressive funding haul be a sign of things to come for fit tech companies or was the round more of an anomaly given the current economic outlook? The latter outcome is possible, as EGYM seems unique in its ability to offer software and hardware solutions under one brand. 

• 

  8. BowFlex, BODi Change Names To Spark Turnaround

  2023 saw a pair of down-on-their-luck fitness brands change their names in hopes of sparking a turnaround. In March, The Beachbody Company announced it would be known as BODi moving forward, a move co-founder and CEO Carl Daikeler said aligned with a shift in the company’s strategy toward inclusive fitness and wellness and away from the looks-based marketing that made the brand famous but has seemed to turn off modern consumers, especially Gen Z. 

  In the fall, Vancouver, Washington-based fitness equipment maker Nautilus changed its corporate name to BowFlex, rallying behind its most popular brand. As part of the rebrand, BowFlex introduced a new color scheme, marketing campaign and at-home equipment designed to target consumers in the connected fitness era. 

  Why It Matters:

  Two of the biggest fitness brands of the 2000s era have struggled in recent years, but they’re not going down without a fight. For both companies, the name change has been accompanied by a major rebranding effort that could fundamentally change the way each positions itself in the fitness and wellness industry. 

  What To Watch in 2024:

  Will the name-change tactic employed by BowFlex and BODi give other struggling fitness companies a blueprint to follow to regain relevance, or will it prove to be a cautionary tale for fitness and wellness brands looking to return to their glory days?

The post The Fitness & Wellness Moves That Defined 2023 appeared first on Athletech News.

The Beachbody Company, the subscription health and wellness company now doing business as BODi, has entered into a definitive securities purchase agreement with institutional investors for the purchase and sale of 543,590 shares at a purchase price of $9.75 per share in a registered direct offering.

The California-based health and wellness company says the closing of its offering is expected to occur on or about December 13, 2023. The offering is expected to generate approximately $5.3 million in gross proceeds to BODi, before placement agent’s fees and other offering expenses. BODi says it will use the net proceeds for general corporate purposes.

BODi will also issue to the investors warrants to purchase up to 543,590 shares of common stock, with an exercise price of $11.24 per share, which will be exercisable six months following the date of issuance and have a term of five and one-half years following the date of issuance.

The health and wellness platform has been in the midst of an ongoing strategy to restore the brand to its former glory, but it has proven to be a rocky road. The registered direct offering follows a reverse stock split the BeachBody Company instituted last month.

“We are confident that our recently developed turnaround plan will help drive profitability, free cash flow and help to increase our cash on the balance sheet,” said Mark Goldston, executive chairman, of last month’s reverse stock split completion. “In addition to the major cost savings program we have implemented, we are aggressively developing new programs to unlock incremental revenue opportunities.”

Goldston added that BODi’s execution of its “robust turnaround plan” will put the company on the right path to regain compliance with the New York Stock Exchange’s minimum closing price requirements and “drive long-term shareholder value.”

BODi posted its Q3 2023 results in November, showing a total revenue decline — $128.3 million compared to $166.0 million in the prior year period. Carl Daikeler, BODi’s co-founder and CEO, noted that for the remainder of the year, the company would be “intensely focused” on executing its sales and marketing initiatives.

Earlier this year, the company rebranded from The Beachbody Company to BODi. Around that same time, the company was hit with a class-action suit brought forth by a former Beachbody coach targeting its multi-level marketing structure. (The company denies the allegations and, in a statement to Athletech News, said it would “vigorously defend” itself against the suit.)

Most recently, BODi established a new effort to reward its high-performing network sales partners with special bonuses, which will begin in January 2024.

The company also named author, speaker and high-performance coach Brendon Burchard its chief growth and performance Advisor.

The post Beachbody Raises $5.3M Via Registered Direct Offering appeared first on Athletech News.

The Beachbody Company, now doing business as BODi, has made two significant moves as it continues its ongoing turnaround plan — both of which the subscription-based health and fitness system says will drive profits and increase paying members.

After the health and fitness company received a deficiency letter from the New York Stock Exchange last year, with its shares parked under $1.00 throughout 2023, Beachbody’s board of directors has approved a reverse stock split of all issued and outstanding common stock at a ratio of one post-split share for every fifty pre-split shares. 

The stock split became effective on Nov. 21, with The Beachbody Company’s Class A common stock now trading on the split-adjusted basis on the NYSE under ticker ‘BODY’ as of Nov. 22.

The move underscores Beachbody’s mission to drive profitability, free cash flow and help increase cash on its balance sheet, said Mark Goldston, the company’s executive chairman. Goldston also indicated that the company is “aggressively developing new programs” to unlock incremental revenue opportunities. 

“While the execution of our robust turnaround plan will put us on the right path to regain compliance with the NYSE’s minimum closing price requirements and drive long-term shareholder value, we believe that instituting a reverse stock split is the most appropriate action at this time to address the uncertainty regarding our listing,” he said.

BODi shared its Q3 2023 earnings earlier this month, reporting revenue of $128.3 million compared to $166.0 million in the prior year period.

Can BODi Attract New Subscribers?

While Beachbody works to regain the credibility of its stock on Wall Street, it’s also zeroing in on attracting new members to BODi, its flagship subscription fitness platform.

The health and wellness company has just launched BODi Previews, a new subscription tier for consumers to sample over $59 worth of BODi content for free. BODi notes the new tier is one of its many initiatives designed to engage, drive new memberships and generate revenue.

‘BODi Previews’ allows prospects to access the health and fitness platform and sample over 120 workouts such as P90X, Insanity, 21 Day Fix and #MuscleBurnsFat, nutrition guidelines and personal development content.

BODi anticipates a “significant increase” in its conversion rate of visitors to paying subscribers since visitors can discover the perfect program based on their individual needs and preferences.

To drive even more traffic to the free sampling, a limited version of ‘BODi Previews’ will be available on YouTube.

“We believe in balancing growth with profitability in our mission of helping people improve their overall health esteem,” said Carl Daikeler, co-founder and CEO of The Beachbody Company/BODi. “‘BODi Previews’ is not only about expanding our reach; it’s about reaching more people while also driving revenue streams that support our long-term vision.”

Last month, BODi revealed its “growth game plan” to reward high-performing network sales partners within its subscription-based health and fitness system, which is expected to roll out in January 2024 and will award star network sales partners with special bonuses.

The new incentive system follows a class-action lawsuit condemning Beachbody’s multi-level marketing structure, where an ex-coach alleged that the company misclassified coaches as independent contractors instead of employees — an allegation the company has denied, noting plans to “vigorously defend” itself against the suit.

The company also appointed Brendon Burchard, author, speaker and high-performance coach, as its chief growth and performance advisor. In his new role, Burchard is helping to roll out GrowthDay, a personal development app that he founded for the BODi network to sell to prospective customers.

BODi has also overhauled its content development strategy, streamlining its content into its digital fitness library and moving GrowthDay to its new mindset channel. A newer monthly digital and nutrition subscription bundle, “The $99 Rebel,” was also introduced as a budget-friendly option for new subscribers. 

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Athletech News’ Q2 2023 Earnings Insights report highlights trends that the major publicly traded fitness companies reported for the quarter ended June 30, 2023.

Here we focus on revenue, fitness center openings, memberships, strategic initiatives, and company revenue outlooks across six public fitness companies spanning fitness centers and studios to connected fitness and equipment companies

Note that Nautilus refers to the quarter ending June 30, 2023 as 1Q24 and Peloton refers to this quarter as 4Q23; for sake of comparison, we are referring to this quarter as “2Q23” throughout this report and are comparing the quarter ending June 30, 2023 for each of the companies.

Key Takeaways:

• Revenue increased across the combined three major fitness centers, Lifetime Group Holdings (Life Time), Planet Fitness, and Xponential Fitness by 24.2% year over year (YoY), with Xponential Fitness reporting the highest revenue growth of 29.9% from 2Q22 to 2Q23. 
• Revenue declined across the three connected fitness and equipment companies, Beachbody, Nautilus, and Peloton by a combined 10.3% YoY. The most significant declines were due to dampened demand for equipment, most notably bikes.  
• Fitness centers are expanding their portfolios. Xponential Fitness, with over 10 boutique studios in its portfolio, is expanding the most aggressively and plans to add 540 to 560 centers by the end of 2023. 
• Membership rates and subscriptions are increasing at nearly all the fitness centers and connected fitness equipment companies. 
• Strategic priorities include brand expansions on Amazon, rebranding, product launches, partnerships, loyalty programs and store expansions.
• Revenue outlooks for the fitness centers for fiscal year 2023 are between 12.0% to 23.4% over 2022 revenue. 

Strong Revenue Growth at Fitness Centers Driven by Franchise Revenue, New Members & Same Store Sales

Xponential Fitness reported the strongest revenue growth YoY of the fitness centers at 29.9%, closely followed by Planet Fitness at 27.6% and Life Time at 21.8%.

Life Time revenue increase was driven by a 25% increase in membership dues and enrollment fees and a 13% increase in in-center revenue. The company’s same store sales were 15.5% in 2Q23, the highest of the three fitness centers

Planet Fitness revenue increase was driven by corporate owned store revenue increases of 12.1% YoY due to a same store sales increase of 10.2%, new store openings and the acquisition of 4 stores in Florida; franchise revenue increased due to royalty revenue and a same store sales increase of 8.6% and equipment segment revenue increased by 82.6% YoY due to higher equipment sales.

Xponential Fitness revenue growth was driven by royalty revenue at its largest segment, franchise revenue, as member visits “reached all time highs.” Same store sales were 15.0% in the quarter. Other revenue increased 62% YoY which includes B2B partnerships and XPass, XPlus and company-owned studios. 

Figure 1. Fitness Center Revenue 2Q22 and 2Q23 ($M; YoY % Change Right Axis)

Source: Company reports, Capital IQ

Revenue Declines at Connected Fitness/Equipment Companies Mainly Due to Lower Demand for Cardio Equipment

Beachbody had the steepest revenue decline YoY, attributable to a decline in its subscription revenue which accounts for over 95% of its total revenue. The company’s connected fitness bike revenue declined by 51.9%; the company delivered 5,500 bikes in 2Q23 compared to 8,800 bikes in 2Q22. 

Nautilus equipment sales were down by 23.8% overall and in the direct and retail segments, down by 17.5% and 29.0% respectively. Cardio sales equipment was down in both segments primarily driven by lower customer demand for bikes, while strength products declined by 34.9% in the retail segment due to lower demand for weights. 

Peloton total revenue declined by 5.4% YoY driven by a 25.4% decrease in its connected fitness revenue. Notably, its subscription revenue segment increased by 10.1%. 

Figure 2. Connected Fitness and Equipment Company Revenue 2Q22 and 2Q23 ($M; YoY % Change Right Axis)

Source: Company reports, Capital IQ

Fitness Centers Are Expanding Their Portfolios, With Xponential the Most Aggressive

Life Time has the smallest fleet with 164 clubs at the end of 2Q23; the company opened 11 stores since 2Q22, representing 7.2% growth, and plans to open 12 clubs by year-end 2023, with eight new centers planned for the second half of the year. 

Planet Fitness has expanded strongly, with 7.5% growth from 2Q22 to 2,472 centers. The company plans to add a total of 160 new Planet Fitness centers in 2023. 

Xponential Fitness grew its store base by 22.7% YoY to 2,892 studios and plans to expand by 540 to 560 studios in 2023 representing the highest number of studio openings in the company’s history. The company sold 234 franchise licenses globally in 2Q23 bringing its total sold licenses to 5,872. 

Figure 3. Fitness Centers/Studios in 2Q22 and 2Q23 and Planned FY2023 Centers/Studios Openings 

Source: Company Reports, Capital IQ

Memberships Grew at Fitness Centers and at the Majority of Connected Fitness/Equipment Companies 

Membership increased at the major fitness companies from 2Q22 to 2Q23 as shown in Figure 4; Life Time added 65,450 members, Planet Fitness added 1.9M members and Xponential Fitness added 158,000 members.

Life Time highlighted that June 2023 was the first month that its attrition rate was below 2019 (pre-pandemic).

Planet Fitness net membership grew by more than 300,00 during the quarter led by Gen-Z membership growth. 

Xponential Fitness management said that North America visitation rates grew by 32% YoY.

At the connected fitness and equipment companies, Beachbody reported 830,000 fewer subscribers, Nautilus added 23,000 subscribers and Peloton added 112,000 subscribers from 2Q22 to 2323. 

Beachbody transitioned to a consolidated digital platform including fitness, nutrition and personal development with a premium subscription price; existing customers have renewed at approximately 60%. 

Nautilus’ JRNY is an AI-powered connected fitness and coaching platform across its BowFlex connected products.  The recent launch of a lower-priced, digital-only JRNY featuring rep counting, form coaching, and strength training has been well-received. 

Peloton introduced a tiered App subscription and saw a higher mix of higher-priced App tier members than expected. While connected fitness subscriptions grew, total members declined by 5% YoY to 6.5M members due to a slowdown in hardware sales and a seat post recall. 

Figure 4. Membership at Fitness Centers and Digital Fitness Subscriptions at Connected Fitness/Equipment Companies in 2Q22 and 2Q23 (M; YoY % Change Right Axis)

*Includes fitness and nutritional subscriptions

Source: Company reports, Capital IQ

Strategic Initiatives: Rebranding, Product Launches, Customer Experiences, Store Expansion & Partnerships

Beachbody: The company held a Partner Leadership Summit, attended by approximately 12,000 coaches and partners, to train partners on its new body premium solution, and “Healthium” category. The company is piloting new strategies including launching a free preview tier in 3Q23 and expanding its nutrition portfolio on Amazon in 4Q23. 

Life Time: Management reported that its customer is interested in the experience and has been insensitive to the price. Therefore, the company’s priority is 100% committed to delivering on that brand experience. 

Nautilus: Ahead of the holiday season, the company is launching new connected fitness equipment including BowFlex C6 SE, the new Max SE, and an elliptical under the Schwinn brand. Nautilus is rebranding by the end of the calendar year. 

Peloton: Peloton reaffirmed the goals it outlined for investors in February 2023 with an overarching goal of restoring Peloton’s growth by “leaning into the future of tech-enabled fitness.” The brand relaunched on May 23^rd which included introducing new App subscription tiers, launching a global partnership initiative with multiple sports franchises, and re-architecting its commercial strategy. 

Planet Fitness: The company is launching a study to reevaluate the 4,000 total domestic fitness store opportunity that it established at its IPO in 2015. Planet Fitness reported that the opportunity could be higher due to its ability to achieve a greater penetration of users at different generations combined with the industry consolidation caused by COVID. 

Xponential Fitness: Xponential plans to explore additional B2B partnerships and enhance XPass and XPlus offerings in the second half of 2023 including introducing an advertising channel into the XPass app in categories such as mental health, apparel, and healthy foods.

Fitness Centers are Reporting Strong Outlooks for 2023; Connected Fitness/Equipment Companies Are Conservative  

Life Time expects revenue to be $2.235B to $2.265B for the year, 23.4% over 2022. 

Planet Fitness expects its revenue to increase by approximately 12% for the full year.

Xponential Fitness raised its outlook for its revenue to $295M to $305M, an increase of 22% over 2022.

Beachbody provided an outlook for 3Q23 only with revenues of $120M compared to $130M in 3Q22, a decrease of 7.7%. 

Nautilus provided a full-year outlook with net revenue expected to be $270M to $300M, between (5.6)% to 4.9% over prior year revenue of $286M. 

Peloton provided guidance for the next quarter, with revenues of $580M to $600M, a decrease of 2.7% to 5.9% compared to $616.5M in the comparable year-ago quarter. 

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BODi, formerly Beachbody, is unveiling a new “Growth Game Plan,” an effort in its turnaround strategy that rewards high-performing network sales partners within its subscription health and fitness system.

The plan rolls out in January 2024 and will provide stand-out network sales partners with special bonuses. The new initiative follows a class-action lawsuit criticizing The Beachbody Company’s multi-level marketing structure after a former coach alleged that the company misclassified coaches as independent contractors instead of employees. The Beachbody Company (BODi) denied the allegations in a statement to Athletech News, saying the company would “vigorously defend” itself against the suit.

In another strategic move, BODi named Brendon Burchard, author, speaker and high-performance coach, as its chief growth and performance Advisor. Burchard will assist BODi’s network boost performance and add GrowthDay, a personal development app that Burchard founded. The app will be available in November for those in the BODi network to sell to prospective customers.

Additionally, BODi has given its content development strategy an overhaul, streamlining new content into its digital fitness library and moving GrowthDay to the core of its new mindset channel. There is also a new monthly digital and nutrition subscription bundle, “The $99 Rebel,” created as a more cost-conscious offering for new subscribers. 

The new program is designed so partners can create a highly scalable business, said Carl Daikeler, co-founder and CEO of BODi and The Beachbody Company. 

“Our success is deeply connected to the success of our incredible network of independent partners,” Daikeler said. “They are instrumental to helping the company influence healthy lifestyle change while developing their own business in the process.”

BODi Looks To Chart a New Course

BODi, facing ongoing challenges, received a deficiency letter from the NYSE last fall, with shares of Beachbody sitting under $1.00 throughout this year. The subscription health and wellness company showed a total revenue decrease of 7% in its Q2 2023 earnings and appointed Mark Goldston to executive chairman in a move to course-correct the company.

Goldston’s appointment is vital to Daikeler’s plans to move BODi ahead, with Daikeler telling investors in August that the new executive chairman had been a pro at turning around companies in less-than-desired situations. 

“We’ve constructed a powerful turnaround plan for the company and we will be vigilant in our focus and execution as we move our way through the priority list to help transform BODi into a very profitable, cash-rich company,” Goldston assured investors on BODi’s last earnings call. 

He added that BODi isn’t experiencing a scale issue — pointing out that it’s one of the largest digital fitness companies — but that it needs higher-quality revenue streams.

Earlier this month, the company filed a prospectus related to the offer and sale of a $50 million mixed securities shelf.

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The Beachbody Company, recently rebranded as BODi, is still in the midst of a strategic revamp according to its Q2 2023 earnings results, demonstrating a total revenue decrease of 7%, with $134.9 million compared to $179.1 million in the prior-year period. 

While the first quarter marked a significant transition for the subscription health and wellness company, BODi says its second-quarter results are in line with the fitness industry’s seasonality. Now, the company is banking on Mark Goldston’s recent appointment as executive chairman, confident that he will restore the at-home fitness and wellness brand back to its former glory.

Goldston, who assumed his role approximately two months ago, had agreed to compensation in the form of equity stock options.

“This transaction was so important to my determination to turn around the company and my enthusiasm for partnering with an executive who has done this kind of turnaround many times before,” Carl Daikeler, BODi’s co-founder and CEO, told investors during Q2’s earnings call. “I forfeited eight million common shares that I personally own to minimize dilution of Mark’s equity grant to the rest of the shareholders.”

Goldston says BODi’s goal is to prioritize profitable revenue, not growth, at all costs. 

“As one of the largest digital fitness companies today, scale is not the primary issue for this company,” Goldston told investors. “What we need to develop are higher quality revenue streams that generate healthy contribution margins to increase the bottom line… We’ve constructed a powerful turnaround plan for the company and we will be vigilant in our focus and execution as we move our way through the priority list to help transform BODi into a very profitable, cash-rich company.”

Goldston reminded investors that BODi is poised to make a significant comeback, pointing to its comprehensive digital fitness library and lineup of nutritional products, as well as a customer database containing over 14 million former customers – ones that he says can be activated easily and “profitably” via “aggressive win-back programs.”

BODi has also restructured the financial covenants in its financing agreement and paid down its debt level by $15 million to approximately $35 million.

“We are excited about the trajectory of BODi’s transformation and are proud of our team’s hard work to get us where we are today,” said Daikeler.

BODi Looks to Amazon as Growth Opportunity

BODi also reports that its conversion ratio of visitors to subscribers increased by 27% in Q2 over Q1, which the company says is driven by audience targeting and messaging enhancements. The health and fitness company will also pilot additional strategies, including launching a new free preview tier, in Q3. 

As for BODi’s nutrition portfolio, the company will expand its products on Amazon, identifying this avenue as a significant growth opportunity without undermining its other sales channels. Nutrition revenue was $64.6 million in Q2, down 13% from $74.1 million in the prior quarter, but BODi says it sold more digital and nutritional bundles, which resulted in higher allocations of revenue to digital.

“We’re in the process of selecting an experienced partner with best-in-class capabilities that will help us drive growth on Amazon with proven best practices,” Daikeler said.

Digital revenue was $65.2 million, up from $64.8 million in Q1, but had decreased from $78.0 million in the prior-year period. Another strategy for attracting fitness enthusiasts is to create a complimentary preview layer of digital content, which BODi says will enable its database activation team to convert visitors into paying digital and supplement subscribers.

While overall digital subscriber count decreased by 12% to $1.53 million in Q2 from Q1 of 2023, the new BODi digital premium subscription platform shows promise, growing subscribers by 77% to $711,000 in Q2 over Q1.

Connected fitness revenue was $5.1 million, down 15% from $6 million in Q1, although BODi delivered 5,500 bikes versus 4,700 bikes in Q1, a 17% increase, which Marc Suidan, CFO, says reflected a planned promotion during Q2 for BODi’s partners. 

As for what the future holds for BODi, Goldston and Daikeler encourage patience. 

“The next few months will be a period of positive and deliberate transformation,” Goldston said. “So I’m going to ask that you please be patient with us as we tap into new revenue streams, new audiences and new marketing tactics that the company has not previously utilized. I feel great about the prospects for a successful turnaround at BODi and I’m looking forward to profitable growth ahead.”

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The Beachbody Company, which now does business as BODi, has amended certain financial covenants and other terms of its $50 million term loan with Blue Torch Capital.

The decision to amend the terms of the revenue covenant is meant to better align the loan with the fitness and wellness company’s profit and free cash flow objectives, according to Carl Daikeler, Beachbody co-founder and CEO.

“The amendments reduce the revenue minimum to quarterly revenue of $100 million for each quarter through March 31, 2024, then to $120 million for each quarter thereafter,” Daikeler said. “These changes reflect the company’s focus on becoming cashflow positive.”

Daikeler has told investors that as the health and fitness company has undergone a major transition with its new name, it’s been encouraged by Google data that revealed search traffic significantly increased as consumers searched for BODi, indicating increased brand awareness. 

Mark Goldston, Beachbody’s new executive chairman, said the company’s new business model is driven by its turnaround plan, which is designed to maximize profitability and cash generation from the company’s multiple revenue streams versus growth “at all costs.”

“We are committed to creating a revenue mix with higher profitability channels that produce increases in cash as a priority,” Goldston said. “The Blue Torch team has been great to work with while amending the terms of our agreement to reflect their support of these objectives.” 

Goldston was appointed to his new role in June to help guide the fitness company’s transformation and unlock growth opportunities. 

“Given our existing cash position and progress over the past 6 quarters, we agreed to prepay $15 million of the term loan’s principal and increase the minimum liquidity amount to $20 million through March 31, 2024, and then to $25 million thereafter,” said Marc Suidan, Beachbody’s chief financial officer. “We believe the net result is a very positive development. The amendments align with building a profitable and sustainable business and provide us with the flexibility to put our turnaround plan into place to focus on cash generation.”

A class action lawsuit was recently filed against the southern California-based company, alleging that its multilevel marketing model exploited workers in the Golden State. Beachbody told Athletech News it would vigorously defend itself against the allegations and pointed to California’s updated contractor law and network marketing distributor exemption.

More recently, BODi introduced a new workout program that targets the growing primal fitness trend, which Pinterest Predicts identified as the fitness trend of 2023. The brand has also pivoted towards the importance of mental health offerings as part of its “health-esteem” approach.  

The Beachbody Company’s next earnings report is expected Aug. 8.

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BODi, recently rebranded from the famed Beachbody name, has tapped celebrity trainer Amoila Cesar to bring a primal workout, “Chop Wood Carry Water,” to fitness consumers. The latest fitness offering is in line with a Pinterest Predicts report that revealed primal movement is anticipated to be the fitness trend of the year for 2023.

BODi says the rugged name is inspired by the Zen proverb that reinforces the benefit of patience and consistent repetition, leading to mastery. 

The new Chop Wood Carry Water fitness program is designed for all fitness levels, allowing members to improve strength and mobility while reducing pain. The goal is to provide freedom of movement that will bring fitness enthusiasts back to the mobility of their youth.

The primal fitness offering concentrates on strength building using functional movements that replicate those used in real life. BODi says that as fitness enthusiasts move through the program, they quickly see how their bodies improve and adapt. 

“Since the pandemic, we’ve found that people are less focused on their visible transformation from a one- or two-month commitment and (are) far more enthusiastic about building their confidence, strength and overall sense of physical freedom of movement,” said Carl Daikeler, co-founder and CEO of BODi and The Beachbody Company.

Daikeler added that BODi has been developing the Chop Wood Carry Water program with Cesar for over a year and has tested the primal fitness program with groups of all skill levels. 

“The results could not be more exciting,” Daikeler said. “We saw the predictable weight loss and muscle tone, but these movements are helping people feel more agile and newly empowered to move through life like they haven’t in recent memory – and for the participants in their 40s and above, they felt empowered and able to move with a pain-free dexterity that they hadn’t in years.”

BODi’s new program offers 20 strength and agility-building workouts that combine seven formats and schedule options, so fitness consumers can select a program that works best for their needs. 

Cesar, who has trained celebrities and NBA superstars, says that primal movement has become a “core principle” in his health journey and an “amazing tool” as he trains his clients. 

“I have designed this program to reflect the importance of the mind-body connection that they project,” he said. “Chop Wood Carry Water represents the habits and rituals on which I center my day: repetition and the pursuit of mastery.”

The primal program, $49.95, is now available with an existing BODi membership.

Can a Primal Program Help BODi Rebound?

Since it left the Beachbody name behind, BODi has been moving away from the standard diet and fitness offerings, instead moving towards optimal wellness and, more importantly, what it calls “health esteem.”

Daikeler said he grew tired of what he views as an old playbook that the fitness industry uses to convince consumers that they’re never good enough and always need another goal to achieve. 

“That’s called permanent dissatisfaction,” Daikeler told Athletech News in an exclusive interview in April.

BODi also introduced online mental health classes earlier this year as part of its health esteem mission.

As the health and fitness company looks to redefine wellness, it’s staring down a class action lawsuit that targets Beachbody’s longtime multi-level marketing model.

The company has also faced stock challenges, with shares of BODi down nearly 37% in the past six months. In the first quarter of 2023, BODi reported a revenue decline of 27%, with total revenue of $144.9 million compared to $198.9 million in the prior-year period.

BODi’s next earnings report is slated for August 14. 

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The Beachbody Company, which now does business as BODi, has created a new role to drive transformation and maximize profitability, appointing Mark Goldston to the position of Executive Chairman of BODi’s board of directors.

Goldston will partner with Carl Daikeler, BODi’s co-founder and CEO, to guide the transformation of the fitness and wellness company, driving profitability and unlocking growth opportunities. 

The news of the appointment follows a class-action lawsuit recently filed against the company regarding employment practices. The suit criticizes the health and fitness company’s multilevel marketing business model, alleging it exploits California workers.

BODi, pointing to California’s updated contractor law and network marketing distributor exemption, has told Athletech News that it will vigorously defend itself against the allegations.

Goldston, who agreed to receive compensation in the form of options, currently serves as chairman and CEO of The Goldston Group, a firm specializing in strategic advisory services, venture capital and investments. He is also general partner of Athletic Propulsion Labs, a high-end performance athletic footwear company. 

As Goldston settles into the new role, BODi confirms the chairman position will be retired, and that Daikeler will continue serving as a director and CEO, remaining BODi’s controlling shareholder.

“I felt strongly about pursuing Mark given his unique skills and experience, and I am thrilled to welcome Mark to BODi as our new executive chairman,” said Daikeler. “I am incredibly grateful that Kevin Mayer, a director on our board and a longtime friend to Mark, introduced us with the vision that the company and its shareholders could benefit from Mark’s capabilities.”

Daikeler added that his goal is to leverage Goldston’s strategic insights, particularly his experience with public companies. 

“I believe so strongly in our synergy that in order to get this deal done, I personally forfeited a portion of my shares of the company to help partially offset the equity compensation offered to Mark with his appointment,” Daikeler said.

Goldston said he’s fully committed to maximizing BODi’s business model, helping lead its transformation and monetizing its “significant untapped potential.”

“I am so confident in the company that I have elected to take all of my compensation in the form of options, aligning my interests with shareholders, and I look forward to collaborating closely with Carl, the leadership team, and the entire organization to achieve our shared goals,” he said.

In an earnings call last month with investors, Daikeler classified the first quarter of 2023 as a major transition for the health and fitness company. Daikeler said he was encouraged by data that revealed Google search traffic was up nearly 290% in Q1 over the prior year as consumers have searched for “BODi.”

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If you’ve ever been enamored by a piece of health and wellness tech, whether an immersive digital app or a futuristic connected rowing device, there’s a decent chance SweatWorks helped create it. 

Founded by Mohammed Iqbal in 2012, the fitness technology agency has worked with brands including Equinox, Nike, Bose, SoulCycle, Strava and Beachbody, to name just a few.

SweatWorks partners with brands on software and hardware, giving the agency and Iqbal unique insights into the technological trends shaping the fitness industry. It’s also made SweatWorks a heavy hitter in the industry, with a rock-solid network that extends into big tech. 

“If we need to get an app approved urgently on the App Store, we know who to call at Apple,” Iqbal tells Athletech News. “If you have an issue with the Garmin App, which we created, we can go right to the person who wrote the software.”

Iqbal sat down with ATN for an exclusive, one-on-one interview to share his thoughts on how technology is changing fitness and what those developments will mean for big players like traditional gyms and connected fitness companies. 

Athletech News: How did the pandemic change the way the fitness industry uses technology?

Mohammed Iqbal: The pandemic really brought the attention of engagement on digital to the forefront. It pulled the industry forward at least five years in terms of growth and development. Because we were stuck on our own and couldn’t interface with our community, our adaptation as digital consumers happened at a quicker pace than anyone would’ve thought. So when people came back (to gyms), they were maybe used to riding a Peloton at home, now they’re going into the gym and riding a stationary bike, and it feels archaic. It feels like it’s “dumb technology.”

So what do we find today? People at gyms are using some kind of third-party app, usually following some sort of program. Maybe they have an Apple Watch or an Oura Ring, or maybe it’s just an app on their phone that allows them to do a challenge with their coworkers. The digitization of fitness and wellness has driven some of the innovations that we’ve seen over the last couple of years.

ATN: What major trends are you seeing in the fitness industry post-pandemic?

MI: First, the connected fitness direct-to-consumer market is decimated, outside of the already established companies like Peloton, Tonal and maybe some of the other big ones. The valuations for these companies are being reset to become more down-to-earth.

As a result, brands that are fitness-modality focused are struggling to acquire and retain members. Whereas those who are offering personalized, wellness-focused programs, such as Pvolve, will continue to attract a healthy TAM.

The second thing is, we went through this era, almost like what the pharmaceutical industry does with drug ads for things like restless leg syndrome. You watch those commercials and you’re like, “Oh yeah, that’s me, my leg is restless.” Not really, everyone on the planet feels like that. The fitness industry was a bit like that, where we created products for a problem that didn’t really exist. I’m seeing us trend away from that.

We’re also starting to see companies move away from point offerings, so instead of offering a gym membership or a connected bike, they’re going to offer a wellness ecosystem. That’s a really big shift. Now, if you’re a gym, like a Life Time, for example, you’re going to bring in, digitally and physically, nutrition, supplements, therapy and mindfulness, all those features.

There’s also fitness subscription fatigue. The average consumer today has about 14 paid subscriptions on their phone. The number for fitness consumers is probably higher than that. Especially since we’re in a recession or entering a recession, people are more conscious. They’re deleting subscriptions and they’re finding the one app or place where they want to be. As a result, companies are building out wellness ecosystems.

ATN: Which fitness companies are best positioned to thrive in the wellness ecosystem era?

MI: I view it in three buckets: big tech, large gym locations and healthcare.

If you look at Apple Health, it’s already kind of the central repository of data. You may see Apple Health being a kind of middleman, collecting data from everywhere, and passing it along to those companies.

I definitely see the large gyms playing a big role. Look at what Planet Fitness has done with their app, because they hold the relationship with the customer. You go see a doctor maybe once a year, but you go to the gym three times a week or more. So the gym is very present, especially if you don’t (physically) go to work. Many people go to the gym more often than the office. Before the pandemic, a lot of that relationship and emotional connection to the community might have resided in the office. Today, it’s transferred to the gyms. So I think the large gym chains hold the keys to that ecosystem. The smart ones, the ones that embrace technology and understand where the industry is going, are going to be the ones that control the narrative.

And the third is health insurance companies. They recognize they have to embrace change, and they’re going to pay a lot more attention to preventative measures than they ever have before. 

ATN: Which fitness companies could struggle in the wellness ecosystem era?

MI: I think we’re going to see companies, especially some connected fitness companies, not be around for too much longer. Some companies are really struggling with valuations, struggling just to bring new members in. It’s because their value proposition isn’t strong enough yet. Those companies need to find ways to commercialize their products and access new distribution channels.

ATN: What can fitness brands do to stay competitive?

MI: Interoperability is key. Look at Oura Ring, which, if you think about it, is subscription-based. Membership is $6 per month. Oura Ring gives you insights, but it doesn’t tell you what to do. What they’ve started to do is build integrations, so now they allow a bunch of companies to pull data and help personalize their experience. I think that’s what needs to happen. We need to break down these silos.

Interoperability is the key theme that we continue to see happening. I know companies might not be in favor of it, but they have to do it, because if they don’t, they’re going to become obsolete. 

Another part is AI. Data is the new oil, and AI can help companies make sense of the data they’re collecting. AI has been a great partner in helping us ingest, collect and analyze all the data we’re collecting.

At SweatWorks, we’re also using AI to personalize. Let’s say you had a horrible night’s sleep and you’re supposed to do a five-mile run. Maybe you do a three-mile run instead and you focus on recovery. We can use AI to help with those types of recommendations. For personal trainers, AI is going to give them deeper insights into their clients. Also, for those that can’t afford to spend $100 per session on a personal trainer, it’s understanding how AI can be helpful for them, so they’re not just following a standard strength program, but one that’s really personalized for their needs. AI can be a great tool there.

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The Beachbody Company, now known as BODi, is facing a class-action lawsuit after a former coach claims that the company misclassified coaches as independent contractors instead of employees.

The bulk of the case revolves around Beachbody’s multilevel marketing (MLM) business model, which the suit claims “virtually guarantees” that the fitness company will “secure thousands of hours of free or below-market labor to execute a centralized marketing and growth strategy.”

The plaintiff, Jessica Lyons, is represented by Tycko & Zavareei LLP and the Clarkson Law Firm P.C. The case has been filed in Los Angeles County Superior Court of California.

The lawsuit claims that Beachbody exploited its California sales force, known as “coaches,” alleging that as coaches market and sell a variety of Beachbody’s products, including workout videos, supplements and beverages, they’re essentially working for free or at an extremely low wage.

The plaintiff cites Beachbody’s multilevel marketing model as its means of avoiding accountability and alleges that coaches are promised the chance to build a business but are simply supplying free marketing and sales support that “would otherwise cost Beachbody millions.”

Despite being trained by other coaches, reviewing Beachbody materials, marketing, distributing and selling the wellness and fitness products per the company’s guidelines, the plaintiff alleges she was paid “virtually nothing” while also incurring personal costs.

Beachbody plans to “vigorously defend ourselves against these allegations,” a spokesperson for the company told Athletech News.

“The independent contractor status of direct sellers is well recognized on a federal and state level,” the spokesperson said in a statement. “California’s updated contractor law (AB5) includes an express exemption for network marketing distributors as part of a well-established legal framework that allows distributors to remain independent and allows them to work as much or as little as they want, controlling their own schedule.”

The lawsuit against Beachbody comes as MLMs have garnered a side-eye in recent years, the result of a documentary depicting the downfall of LuLaRoe sellers, an anti-MLM Reddit community and “The Dream,” a podcast that explores well-known MLMs and sheds light on issues that commonly arise due to the nature of such a business model.

Glenn Danas, partner at Clarkson Law Firm P.C., stated that the class action against Beachbody has the potential for “seismic implications” not just for the health and fitness company, but other MLM companies.

“If the court agrees with us, this will allow thousands of Beachbody’ coaches’ to be paid for their hard work and will upend Beachbody’s business model,” Danas said.

Update: This story has been updated to include comment from Beachbody

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The Beachbody Company held its first earnings call for 2023, a quarter that CEO Carl Daikeler said marks a “major transition” for the health and fitness company, which recently rebranded to BODi.

The company finished upgrading its subscription platform and simplified its business model, shifting to monthly content organized into three-week blocks with goals and objectives, having launched BODi in March. The single subscription plan better aligns with the company’s rebranding as it incorporates a mental health focus into its offerings.

Despite the significant changes, Daikeler believes BODi has much more to accomplish and that the company’s expanded BODi subscription platform is the “biggest and most important innovation” since the company’s inception.

Daikeler revealed that BODi is taking a more conservative view of its Q2 outlook, remaining assured that the company will achieve EBITDA profitability on a quarterly basis by the end of the year.

“I’m confident that this will be our next multibillion dollar opportunity to drive long-term sustainable growth,” the BODi CEO said. “We’re in the early stages of promoting this new premium subscription but I can report that we are already seeing promising customer demand based on the engagement and renewals of existing customers.”

Here are some key takeaways from The Beachbody Comapny’s first earnings call of the year, as Daikeler discusses key insight from Google search data, a looming recession and how he thinks weight loss medications like Ozempic can be a golden ticket for the company:

Q1 2023 results at a glance:

• Total revenue was $144.9 million compared to $198.9 million in the prior-year period, a 27% decrease.
• Operating loss improved to $27.4 million compared to an operating loss of $74.4 million in the prior-year period.
• Net loss was $29.2 million compared to a net loss of $73.5 million in the prior-year period.
• Adjusted EBITDA was ($0.9) million compared to ($19.1) million in the prior-year period.

BODi subscriptions

Daikeler revealed that BODi surpassed 500,000 subscriptions as of April 30, approximately double its total at the end of Q4 2022, an increase he says was driven by digital renewals and upgrades.

“The early strength in renewals demonstrates customers are recognizing that our pricing represents tremendous value associated with our rich catalog of over 120 programs,” Daikeler said. “I mean, everybody knows P90X, Insanity, and 21 Day Fix, but also our new BODi programming and the monthly release of new BODi blocks for general fitness consistency.”

Google searches

Daikeler pointed to data that revealed Google search traffic is up 287% in the first quarter over the prior year, as interested consumers have been looking up “BODi” using the search engine.

“Since the repositioning to BODi just in March, web traffic to our sites increased by 20% over February,” Daikeler said.

Plans to drive customer acquisition

Now that BODi and its offerings have been introduced, the company will focus on the execution of its go-to-market strategy, with Daikeler saying it’s time to “go on the offense.”

Since the company’s partner network forms the majority of sales generation, BODi has implemented new incentives to align its partners with its goal of driving subscriptions.

The company will host its annual Partner Summit in June, typically attended by around 10,000 partners. Daikeler said it will be an “immersive training” of the company’s network to align partners with its strategy and sales tactics to serve the “massive TAM of over 150 million people who are overweight or obese in the U.S.”

As for direct media acquisition, Daikeler confirmed that the company is working with an experienced social media and marketing agency to expand the reach of its message into TikTok and YouTube. Last month, BODi launched technology to communicate with customers through its app and text messages to boost customer engagement and build more targeted email marketing campaigns.

BODi’s view on a looming recession

When an investor brought up recession risk and cited IHRSA research that showed the fitness industry declined in terms of memberships during the 2008-2009 recession, Daikeler responded that BODi is a “very cost-effective alternative to the gyms.”

“We think we’re well positioned for that with our holistic approach to fitness, nutrition and now, positive mindset masterclasses,” added Daikeler.

The BODi CEO and co-founder noted that his fitness and nutrition company has existed for 24 years in some form or another, demonstrating its longevity.

Daikeler said: “If you look around the industry of nutrition and fitness solutions, there aren’t a lot of companies that have managed to have that kind of stamina and innovate over and over again and this launch of the health esteem category and the BODI subscription. This will be our fifth big innovation as a company. We’ve run this playbook before.”

Could weight loss drugs be an opportunity for BODi to shine?

Daikeler sees the surge in weight loss medication as an opportunity for BODi.

For weight loss medication patients to have long-term success, they’ll need an opportunity to overhaul their lifestyle, which Daikeler says BODi can help provide with its tools, especially those focused on mental health.

“We are the holistic fitness, nutrition and positive mindset resource for people who need to change their lifestyle at the same time that they contemplate prescription medication,” he said. “So we’re really in this ideal position. It feels like everything that we’ve done for the last 24 years has led up to this moment.”

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With May just warming up, BODi is celebrating Mental Health Awareness Month by launching new Mindset Master classes, an extension of the brand’s “health-esteem” platform. 

Petra Kolber, vice president of personal development and mindset for BODi, says that as more people become aware of the importance of mental health in a post-COVID era, it’s essential to focus on creating a resilient mindset to guide people through the ups and downs of life.

“While BODi’s Mindset content is not a replacement for professional mental health services, it is our hope that it can shed some light on how to begin taking the steps toward making positive changes by celebrating where you are today while emphasizing how a powerful an unwavering belief in yourself and your abilities to face the more challenging times, can make a lasting impact on your health esteem and mental well-being,” Kolber said of the latest offering.

The Mindset content library is available as part of any BODi membership. It features Mindset Master classes and weekly content with industry experts, including Kolber. 

Jonathan Fields, award-winning author, executive producer and host of two top-ranked podcasts, and Maria Sirois, psychologist, teacher, facilitator and author, will also offer expert insight for Mindset Master Classes. 

According to BODi, its multi-video Mindset Master Class Series includes:

• “Happiness Habits” with Petra Kolber
• “The Good Life” with Jonathan Fields
• “Calm Your Mind” with Maria Sirois
• “The Perfection Detox” with Petra Kolber

Bodi says other Mindset Master classes and experts are arriving this summer, including classes with Kelly McGonigal, Ph.D., TED Speaker and best-selling author, who brings a new Mindset Master Class based on her book “The Willpower Instinct.” Justin Michael Williams, a meditation teacher, author and Grammy-nominated recording artist, will also have a class where he will discuss meditation in a new light.

“What’s so unique about the addition of the Mindset channel to the BODi platform is its integration with our flexible fitness and nutrition programs,” said Carl Daikeler, co-founder, chairman & CEO of BODi. “Bringing the benefits of physical health together with a resilient and growth mindset, resulting in a strong self-esteem, is a combination which defines the category of health esteem.”

BODi is rewriting the script of what it means to be happy & healthy 

In a recent interview with Athletech News, Daikeler declared that “Beachbody is dead,” referring to the rebrand from Beachbody to BODi. 

While the household name for fitness and nutrition introduced the world to P90x, Power 90, Slim in Six and Hip Hop Abs, the company has overhauled its image to move away from what Daikeler calls an “old playbook” – one that keeps consumers in a state of “permanent dissatisfaction” where they are never good enough and always have something more to achieve. 

The lightbulb moment came when Daikeler pondered the example of certain health and fitness frameworks set for his children, he told ATN.

Can ‘health-esteem’ bring positive earnings? 

Daikeler’s company has faced challenges, with Q4 2022 financials revealing that in the twelve months ending December 31, 2022, total revenue dropped 21% compared to the same period in 2021 and 8% below its pre-COVID baseline. As Daikeler told investors on an earnings call, “2022 was a demanding year,” as the subscription health and wellness company received a deficiency letter from the New York Stock Exchange last fall.

Still, BODi is banking on building not just self-esteem, but health-esteem, which includes its new mental health classes.

“We made a decision last year that we were going to pursue a completely different category, one that we call health esteem, that combines immediate appreciation of who you are with a complete lack of a requirement to do anything in order to improve how you feel about yourself and be worthwhile in the world,” said Daikeler.

The health and wellness company is expected to report earnings on May 8 for Q1 2023. 

The post True to New Identity, BODi Launches Online Mental Health Classes appeared first on Athletech News.

Athletech News sat down with the spirited and candid founder and CEO of Beachbody, Carl Daikeler, to hear his perspective on where the industry is headed and why his company is making dramatic changes in its business model. What he told us, though at first surprising, speaks volumes about some of the challenges facing fitness players seeking to make more people fit and healthy.

“Beachbody is dead,” said Daikeler, co-founder, chairman and CEO of BODi, formerly Beachbody. 

He went on to explain. “We’ve had a mission statement for 24 years, which is to help people achieve their goals and lead healthy, fulfilling lives. And the programs that we’ve created, famous ones like P90x Power 90, Slim and Six Turbo Jam, Hip Hop Abs—I could list 100 of them—were the first of their kind to give people basically a legit fitness narrative that you might get from a trainer, but right in your own home, and on a finite timeline. We had 100 workouts that help you achieve your goals in 7 days, 21 days, 60 days, 90 days. It was awesome. And it helped people achieve their goals.” 

Then, suddenly, the company made the decision to change its name, and announced last October the platform would now be called BODi, a moniker it had been considering for its premium subscription.

When asked why such a drastic move, Daikeler’s response was immediate and candid.

“Because, not only is Beachbody dead, but the fitness and diet industry is largely dead. The industry continues to execute an old playbook that needs to convince people of their imperfection in order to engage them. Play one is you’re not good enough, you need to lose weight, so join my gym. And play two is, you are never good enough. There’s always something more to achieve. That’s called permanent dissatisfaction.” 

Daikeler’s aha moment came when he realized that this is the example he’s setting for his kids, ages 14 and 23.

“When we come up with programs, I think about what I want them to see as the legacy of this business that we’ve built. So I knew we had to flip that script.” 

Unlike many fitness executives, Daikeler didn’t come into this business through his athletic background, workout discipline or secret formula for helping get others in shape. If anything, it was the absence of these characteristics that attracted him to the space.

“I’m not a fitness person, I don’t like working out. I don’t like eating well. I was a quasi-athlete in school, but I wasn’t disciplined. I have no problem not exercising. I didn’t love it enough to sacrifice sleep for it unless I had some vacation or something coming up. But what would be psychologically very motivational for me was if I had a timeline. Going from day one to day 90, for instance.” 

This became the genesis of the business, and the part of the Beachbody mission that, Daikeler said, the company “ran the hell out of for 24 years.” The company has grown from its flagship P90x product to a collection of almost 100 digital exercise programs, a nutrition business whose core product Shakeology represents more than half of company sales, connected fitness programs that include a bike, and other products and services. The company went public in 2021 through a SPAC, or special purpose acquisition company, and is now traded on the New York Stock Exchange. Last year the company had 2.5 million subscribers and sales of almost $700 million. 

In the latter part of the last decade, two trends started to eat away at the Beachbody business model. The first was the digital revolution in media. Beachbody’s original strategy was to sign up a customer and ship him or her a box of DVDs with a note wishing them good luck with the 60- or 90-day program. By 2016, the company could no longer put off the shift to digital, which also shifted the customer relationship to a more continuous dialogue.

The second trend that made Daikeler question what Beachbody was doing was body positivity.

“I started to see some problems materialize, not just in our business model, but in the surroundings, people not responding with enthusiasm to what they used to, which were the ‘before’ and ‘after’ photos.”

Although Daikeler claims that intrinsically there were health benefits behind those photos, those were overpowered by the negative reactions, and eventually the connotation of the name Beachbody began to undermine the company’s ability to deliver on its mission. Daikeler recounted searching Google for Beachbody, and instead of seeing his company listing, he would see Kim Kardashian “flaunting her beach body in Malibu,” indicating that the term was starting to take on a newer, narrow definition, not the one originally intended by the brand.

“It started to limit and, in fact, suppress our ability to achieve our mission statement.”

For the last six years, the company has been struggling to evolve from a company that was great at the first part of its mission, that of helping people achieve their goals in a fixed period of time, to one that also delivers on helping people lead healthy, fulfilling lives, which it feels it has failed on.

The company’s recent financial performance indicates it might not be a bad time for a strategy shift. In the twelve months ending December 31, 2022, total revenue dropped 21% compared to the same period in 2021 and 8% below its pre-COVID baseline. 

The missing element, according to Daikeler, is to help people feel better about themselves and to stop participating in the permanent dissatisfaction business.

“We made a decision last year that we were going to pursue a completely different category, one that we call health esteem, that combines immediate appreciation of who you are with a complete lack of a requirement to do anything in order to improve how you feel about yourself and be worthwhile in the world.”

On March 2, Beachbody added an entire new layer to its platform of positive mindset to help people love themselves. From moment one, before the first workout, it helps you, among other things, figure out how to eat more dessert, how to enjoy all the food groups that you want, and how to embark on a fitness program that lets you “have a real life.”

The health esteem routine will include masterclasses from authors and positive psychology experts to help people feel better about themselves and the world in general. The idea, says Daikeler, is that once you you’ve repaired your self-esteem and appreciate yourself, you can choose the right workout or nutrition program that serves you and helps you, not fixes you in a judgmental way.

“We’re not telling you that you need to lose 50 pounds. We’re saying we can get you strong enough, get your metabolism going, with maybe 15 workouts a month, which we call a body block. Do five workouts a week for three weeks, take the fourth week off or go walking or whatever. But give yourself the freedom to live life, have a vacation without thinking ‘I gotta stay on my program.’” 

Daikeler recalls going into a gym that had painted across the wall the slogan “Proud, but never satisfied.”

“Can you imagine? I thought, ‘I need to get out of the industry as quick as possible if that is the mentality that we are promoting, never satisfied, never pleased with myself, which is why you have suicide, overeating, escapism, people who are overdoing plastic surgery, overtraining, and body dysmorphia.’ I refuse to participate in it anymore.”

He may have a point. Forbes publishes a list of the top New Year’s health resolutions each year. In 2023 the number one New Year’s resolution wasn’t lose weight, improve my fitness, or improve my nutrition. It was improve my mental health. 

Daikeler feels there is a lot of virtue signaling going on.

“The tech companies are all claiming that they’re not in the imperfection economy. But if you wear a monitoring device, and it tells you if you’re imperfect today and didn’t close your rings before midnight, that’s stress-inducing.”

“There are gyms that say they don’t allow judgment, but if you bang the weights, or grunt, they sound an alarm. What is that? If I make too much noise working out, the whole room is gonna judge me now?”

“It’s not enough to just change the name, you need to really change the direction of the company. And, can they take the weight watching out of the company by just taking it down to the acronym of WW? It’s still weight watching, right? How about self-esteem watching? What about feel-good watching? What about what-do-you-need-as-a-human-being watching??”

When asked how BODi will break through all the industry noise and walk the walk, not just talk the name change talk, he quipped: “It’s easy. I’m no longer in that business. You probably don’t even want me in your publication.”

“‘Do you feel good?’ is not a binary question, not black and white, it’s a continuum. And that’s what’s wrong with the industry we call the imperfection economy. It’s torturing its customers, telling them they’re not good enough. Then never telling them they are good enough. That is a recipe for a psychological impossible-to-escape cycle.”

Daikeler makes it clear that there’s nothing wrong with looking great, and if it’s a byproduct of feeling great, then even better. And the only way to serve the almost 150 million people in North America who are overweight or obese is to get out of the abs business and into the feelings business.

“Let us be this sunshine in your life, the thing that feels great, not this nagging voice that’s feeding into the judgment, the criticism, and the competition. Instead, this voice will say ‘Hey, back off, you need to take a day off to get your head straight. Because you’re in here for the wrong reason, man. Like, come back in when you’re doing this because it feels so good to push that hard.'”

“And then when it’s 5 a.m. and you’re lying in bed, you’re thinking, ‘I gotta get down there because I love the way I feel about this. I love the way I feel about myself. I love that I love myself enough to do this.'”

“I f#*@-ing rock.”

This article originally appeared in Athletech’s State of Fitness 2023 Insider’s Outlook report. Download the report here.

The post How BODi is Flipping the Script on the ‘Imperfection Economy’ appeared first on Athletech News.

Beachbody, the fitness company known for health shakes and some of the world’s most popular fitness programs, has announced a significant rebranding with the launch of BODi, which the company says rejects the legacy fitness and diet industry playbook. Instead, BODi aims to promote a positive, healthy lifestyle that encourages inclusivity and discourages self-criticism.

The company says it found inspiration to change after witnessing an increase in mental health challenges due to the pandemic, as well as the realization that 74% of Americans are still overweight or obese, despite efforts by the fitness industry.

“The transformation of our brand will inspire a larger shift across the entire industry, which largely ignores the emotional and mental consequences of its traditional business model,”  said Carl Daikeler, co-founder, chairman, and CEO of BODi. 

“Instead of promoting a healthy lifestyle based on self-criticism, we want to help people appreciate their intrinsic value, so they are pursuing their health and fitness goals out of affection for themselves, not judgment or comparison to any ideals,” Daikeler continued.  

“This category is called Health Esteem. This is where the inspiration for our rebrand came from and what the entirely redesigned BODi platform supports. It is a very important moment for the industry, because it opens a category that will appeal to the 150 million adults in the United States, many of whom are alienated by the exclusivity of the legacy industry’s playbook.”

BODi’s CEO believes the health esteem category will open significant net new demand among those who have felt rejected by the legacy fitness and nutrition industry.

“At the end of the day, what we’re most concerned with is helping everyone feel seen and appreciated with disregard to size or shape, and in doing so, help them achieve their version of a healthy fulfilling life,” he tells Athletech News.

“If that brings more people to BODi, then that’s great because it means more people are not only improving their physical health, but their self-esteem as well. We want as many people as possible to benefit from our personalized, comprehensive and effective solutions that enhance their individual lifestyle preferences.”

As part of the reintroduction, an app and fitness program called ‘For Beginners Only’ has been unveiled. It will provide fitness enthusiasts of all levels with an “approachable starting point” for their wellness journey. BODi employs a block periodization training structure that consists of 30-minute workouts five days a week for three weeks, followed by an ‘UP’ week in which the member can scale back workouts, focus on recovery, and reflect on progress.

A new channel for monthly Mindset master classes has also launched.

Perhaps most daring is BODi’s “You Will Fail” marketing campaign. A 60-second spot was created in-house, and, as Daikeler points out, the campaign is about success, as confronting the reality of setbacks is familiar to everyone.

“While the industry at large is quick to offer solutions to help people get healthy – in general, it is very judgmental of people who encounter struggles. That alienates the very people who need help the most,” Daikeler tells Athletech News. 

“Instead of expecting our customers to “just figure it out,” we take it on with them – acknowledge that it’s not easy for everyone, and provide recovery tools to help people not see a setback as failure, but as a reality which is simply part of the journey. It’s so important to acknowledge that failure is not defeat. Everyone experiences some kind of failure in their life at one point, but the promise that they can confront and overcome that failure when they have the right tools and a flexible approach is what resonates with people.”

Q4 2022 Results

Daikeler referred to 2022 as a “demanding year,” and said BODi delivered fourth-quarter revenue in line with expectations. The fitness company reported total revenue decreased 31% to $148.2 million compared to the prior year.

Last fall, the California-based subscription health and wellness company received a deficiency letter from the New York Stock Exchange (NYSE). BODi has made moves to consolidate its operations into a single platform to centralize its technology, marketing, and content investments. BODi said it reduced its nutrition SKUs and bundle configurations from 190 to five.

The fitness company also confirmed it doesn’t foresee the need for additional capital and that its plan to simplify and streamline is working.

“The business implications of these changes are compelling. This consolidation simplified what our network of BODi partners offer. We used to call them Team Beachbody Coaches, now we call them partners,” Daikeler said on BODI’s recent Q4 earnings call.

BODI’s CEO added that this approach allows for the field to spend less time training teams and instead allows them to focus more on helping people engage with the platform. 

“That dramatically increases their income opportunity, which should in turn attract more people to sign up to be BODi partners,” he said.

Pricing changes & subscriber growth 

In Q4, which saw shares drop after the release of Q3 results, digital revenue decreased 16% to $68.7 million, and digital subscriptions decreased 23% to 2.0 million.

BODi introduced updated pricing last September, adjusting the premium app to $179 annually from $298. Most of BODi’s existing subscribers are enrolled in the basic BOD program at $120, reported Marc Suidan, CFO. 

Those members will then transition to the $179 BODi platform as their subscription is renewed – and the company says it hasn’t received pushback from its partner network.

“Since we launched the new BODi pricing in September, our BODi subscriber file size has been growing in a healthy way. So while our overall digital subscriber base in Q4 contracted, BODi is growing. Additionally, we are finding that BODi subscribers have a much higher attach rate,” Suidan said.

Expanding the market reach by focusing on feeling 

BODi’s leadership said the company spent 2022 considering those who have been left behind by the traditional fitness and diet industry, noting that the majority of fitness consumers rejected the notion that they are only good enough if they lose weight.

BODi was surprised by the success of their 4 Week Gut Protocol and Fire and Flow programs, which concentrate on how a consumer feels instead of just fitness results.

“It became clear to us that our transformation model of P90X and INSANITY could be significantly complemented by an ongoing plan that focuses on how people feel today so they stay engaged in the process and appreciate their sense of well-being along the way,” Daikeler said. “This represents a significant business opportunity for us because the data is clear that the legacy industry is failing at this.” 

By focusing on self-esteem, members will gain a sense of happiness – which many others in the fitness industry have overlooked, said the company.

“This is what’s been missing from the model, a comprehensive solution that fits with real life, that delivers happiness on day one, not just physical results at the end of a program,” Daikeler noted.

BODi promotes dessert as its most important strategic initiative

BODi execs said they were “disappointed” with nutrition revenue at $75 million, down 23% year-over-year, but that it plans to turn things around.

BODi confirmed its expanding Shakeology to become the first superfood nutrition shake and now the world’s first superfood dessert. 

“A smart dessert, if you will, with hundreds of recipes that take advantage of the incredible flavor variety of the Shakeology product line,” Daikeler said of the dessert initiative, adding that the healthy desserts represent a $48 billion market opportunity for BODi. 

“There are tens of millions of people who may not be ready to start one of our fitness or eating plans, but who will absolutely take the logical first step of swapping their normal dessert choice for a Superfood Dessert that actually helps them lose weight and makes them feel great.”

The fitness company confirmed that the healthy dessert alternative would be BODi’s largest and most important strategic initiative. However, as BODi points out, the superfood dessert is not a new product, and there are no additional product development costs.

Payment simplification

Daikeler shared that other operational improvements are in the works this year, including simplifying the digital experience by “reducing clicks at checkout” and adding payment options for PayPal and Apple Pay later this year.

Connected fitness

BODi reported connected fitness revenue decreased 87% to $4.8 million, and approximately 3,700 bikes were delivered in Q4.

“Our $50 a month bundle for the bike, and the BODi subscription continues to be our most popular bike skew,” said Suidan. However, he still believes the company needs to create a greater awareness of its connected fitness offering.

“Starting this month, as more users transition to the BODi app, those subscribers will view the bike workout options, making it easier to market this offering to them,” he shared.

For the first time, the majority of BODi subscribers will be exposed to the biking content, which used to be behind a paywall. With the visibility of the trainers participating in rides, BODi said it expects demand for this offering to be incremental. 

While BODi’s connected fitness gross margin continues to be negative, the company said it’s leveraging its bike studio bundle to drive bike sales without “competing in price wars.” 

As Suidan points out, BODi’s data shows that bike consumers are “very engaged in workouts” and have a considerably lower churn rate.

A BODi subscription unlocks BODi Blocks and Mindset content, workouts, and programs from notable trailers such as Shaun T, Autumn Calabrese, Joel Freeman, and Jericho McMatthews. 

BODi is betting big on a holistic approach 

BODi said it expects subscription declines for the year but is resolute in attracting “higher value customers” and believes its new health esteem platform will result in more robust consumer engagement and improve retention over time.

“We are excited by the preliminary results, and this is the foundation to bring us back to revenue growth,” Suidan said.

The post Major Rebrand: Beachbody Transforms to BODi, Announces Q4 2022 Results appeared first on Athletech News.

Supergut empowers people to regain control of their health from the inside-out using their patented line of shakes, bars, and fiber mix to promote a healthier gut microbiome. Marc Washington, the Founder & CEO of Supergut, is on a mission to improve the body’s natural ability to manage blood sugar, satisfy hunger, strengthen immunity, and more. Athletech spoke with Washington about his inspiration for founding the company, his advice for entrepreneurs, and his future plans for Supergut.

ATN: What inspired you to get started?

MW: My entrepreneurial journey started later than most entrepreneurs. I’ve been more of an executive throughout my career. But the space of health and wellness has been a large part of my pathway. It’s my own personal passion and something that I just love. I’m really inspired by helping other people live healthier. But I’ve always done that previously in larger organizations, typically as the right hand to the entrepreneur, helping them scale their business and their visions at scale.

I was taking notes over time and working with very successful entrepreneurs. There’s a lot that I learned along the way. And I discovered many things I would do differently.

It all came together a couple of years ago when stepping back kind of career-wise—thinking of what I want to do, what I want my impact to be in the world. I had this head-meets-heart moment where I had both the things I had done over time and the desire to do something differently. I felt there was a large unmet need in the marketplace.

My motivation also comes from a personal story: my sister was my motivation for starting a company as an entrepreneur. Her name was Monica and she lived with multiple metabolic diseases: diabetes, obesity, and hypertension. She tragically passed away far too young. It’s something that really shook me to my core, and amplified this fire that had been building in me to do something about it, to make a mark and to help people. I said to myself, if not me, then who, if not now, then when?

So, three-and-a-half years ago, when I started this company, I had the aspiration of really impacting health in a science-based way. I also wanted to do so in an accessible way, to make it really easy for people to live healthier.

ATN: Can you expand on the scientific process of developing products?

MW: I think about our business as: on one axis, science-based efficacy, and the other, accessibility, so taste and convenience.

The sweet spot is maximizing the combination of those two. My very first hire was a PhD food scientist that worked for me at a company that I used to be President/COO of called Beachbody.

We really dove into the research. And in particular, the angle and the aspect that we have honed in on is around the gut microbiome. It’s a leading topic and many people are becoming more and more familiar with the fact that your gut really is your control center for health. It was an awakening to see just how profound the science of the gut microbiome is, and how much we know now about the gut that we didn’t know before, and also how we know that there are ways or things that we can do to work with your gut, to modulate it, to point you in a healthier direction.

We poured through hundreds of clinical research studies and really honed in on a unique class of nutrients empowered by a class of fibers called resistant starch that are actually naturally available but just very, very limited in the Western diet. It helps modulate your gut and actually drives health outcomes like better blood sugar control and insulin sensitivity, curbing cravings and managing weight and a plethora of other health benefits, as well.

That’s what led us down this path of formulating our own proprietary blend that includes resistant starch and other prebiotic fibers and then formulating that into tasty food products.

We’ve since gone on and taken it to the next level and built on the science. So not just taking the existing evidence, but actually have gone out, which is also very rare, and conducted a gold-standard clinical trial on our products.

So, we’re actually not just working on the existing body of science, but we are contributing to that body of science, as well, through our own primary clinical study.

ATN: What are your short- and long-term goals?

MW: Recently, we just went through product expansion, as we want to help people transform their health through food as a functional food company that can create different products that work for different people in different use cases.

So, we expanded from shakes into other formats, including bars, which is the same concept, the same kind of resistance starch fiber blend, but in a bar format, and they’re delicious. We also offer that same proprietary fiber mix as a standalone powder as well, which is unflavored and unsweetened. We want to give people different flexibility and convenience to get these nutrients into their diet in a consistent basis. We obviously have more plans in the works about kinds of additional product expansion.

In addition to providing products, our aspiration is to provide content, as well, that can help close some of the information gap about gut health. We are investing pretty heavily in a content engine to produce and put out a lot of educational, informative, and engaging content to help close some of the education gap around gut health. Even if you never knew about gut health, you’re interested in your metabolism, aren’t you? You’re interested in energy and immunity, right?

We think that is doing a benefit for society overall, raising awareness and hopefully by doing so, it also raises awareness and consideration for Supergut, as one of the solutions to help kind of tap into that science of gut health.

ATN: What motivates you?

MW: My North Star is impacting health results. Our culture feeds on actually delivering the promise and hearing about customers telling us that we have helped them make a change in their health for the better. This entrepreneurship game is not easy. But then I’ll go into our community because we have a really vibrant and thriving, you know, Supergut community, and I’ll read some of the posts saying: ‘I used to have you know, significant digestive issues and now I’m much more regular,’ or ‘I used to have to take diabetes drugs and my doctors actually allowed me to get off them because I’m in control now. That re-energizes me. I’m ready to attack the day when I see that. So yeah, I fundamentally care about people getting healthier.

Even as a businessman, a lot of people will start with financial metrics. Those are incredibly important and I pay a lot of attention to them as well, but I lead with results. And I believe that if we consistently can deliver people results at scale, then our revenue and our earnings and everything else will follow as a result.

ATN: Do you have any advice for other entrepreneurs?

MW: Make sure that whatever you’re doing, don’t take the hammer-looking-for-a-nail approach. Start from the end consumer—what problem are you solving? Then, figure out kind of what it is that you are doing or can create that can solve a problem that needs to be solved in the world, versus the other way around. Next, this entrepreneurship game is not for everybody. I’d say, before jumping in: hold on, take a beat, take a breath, and make sure that it’s something you’re willing to invest in because it’s a true investment, not just of years, but of your mindset. The last thing I’ll say is to make sure it’s something you truly fundamentally care about.

When you’re doing something that you really don’t care about, if you’re just selling a widget and you know, that next wall that comes in front of you, you might not have the energy, enthusiasm to climb that wall as much as if it were something you truly fundamentally cared about, right?

When you believe that the world needs what you’re creating and you really care about getting it out there, that gives you the energy to actually climb the walls and get back up again when you get punched. It gives you a chance at making your entrepreneurial ventures successful.

The post CEO Corner: Marc Washington’s Supergut Takes a Science-Based Approach to Gut Health appeared first on Athletech News.

California-based subscription health and wellness company Beachbody has announced it received a deficiency letter from the New York Stock Exchange (NYSE).

The letter notified Beachbody that the publicly traded fitness company is not in compliance with applicable price criteria in the NYSE’s continued listing standards, adding that the average closing price of the company’s Class A Common Stock was less than $1.00 per share over a consecutive 30 trading-day period as of November 22.

In a press release, Beachbody said it intends to respond to the NYSE within ten business days of receipt of the letter to “cure the deficiency.” The digital fitness and nutrition company now has six months to bring its share price and average share price above $1.00, according to NYSE’s rules.

Beachbody says it will consider alternatives, such as a reverse stock split, pending shareholder approval. If Beachbody decides to cure the price deficiency by taking a stockholder-approved action, the NYSE will deem the price condition cured if the price goes over $1.00 per share and stays above that level for at least the next 30 trading days.

The Class A Common Stock of the fitness company will continue to be listed and traded during this period. 

Beachbody recently reported its Q3 results, with total revenue at $165.9 million, a 20% decrease compared to 2021. The fitness brand said it has taken steps to operate more efficiently, with price adjustments and bundle strategies, such as the BODi Bike Studio bundle for $50 a month. 

“It’s no secret that we’re pursuing this goal amid substantial challenges facing our entire industry,” Beachbody CEO and co-founder Carl Daikeler said on the recent earnings call. “As pioneers in the fitness space, we’ve navigated through many challenging times before and come out of each period stronger. In fact, we’ve emerged from every economic downturn in better shape than how we entered it, and I expect this to be no different.”

The Beachbody brand also reported it would reinvigorate nutrition revenue with the launch of a gourmet superfood campaign, and plans to introduce gifting programs to drive sales during the holidays.

Photo by tommao wang on Unsplash

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Will 2023 be known as the Year of Ambition? Yes, says Anne Mahlum, founder of Solidcore and Back on My Feet. Mahlum has raised $5 million for Ambition, her new fitness and wellness venture, and she has signed a lease to bring Ambition to 220 Fifth Avenue.

“I love creating and scaling businesses that make a positive impact on people’s lives, and Ambition will be no different,” Mahlum promises.

The new fitness and wellness concept is set to open in February 2023, with three additional locations in Brooklyn and Manhattan in the works. Ambition will offer four different fitness classes and host events centered on wellness experiences. 

The boutique-style fitness studio will have both heated and unheated rooms. Classes include Pure Strength with Fitbench stations and Y bells, Athletic Conditioning, a Yoga-inspired athletic class with isometric holds, and Recovery with yin yoga.

“We feel there is a need in the market right now for a new premium brand to offer multiple fitness modalities under one roof and to provide sophisticated programming and educational tools on how to be your most optimized self to achieve all your goals,” remarked Mahlum on her latest fitness venture.

Solidcore, which she founded in 2013, now has 88 studios in 27 states. Mahlum raised another $50 million in April and promoted Bryan Myers to CEO. Her success caught the eye of Nolen Young, investor and founder of AXLE.  

“After watching Anne build a business, a brand, and such a strong community through Solidcore, I wanted to be a part of the next chapter. I haven’t met anyone else in the fitness space that is able to execute a vision and pivot quickly while building a community around her,” Young said.

The new fitness venture promises to allow guests to meet their individual goals in a group setting while working out in a beautiful and inspiring environment. “Ambition’s four concepts will work together to deliver workouts focused on strength and endurance, cardiovascular conditioning, flexibility and mobility, and mental toughness,” said Jo Gomez, who will serve as Ambition’s Head of Product. “Each class will be taught by a highly knowledgeable and educated coach who will push you at your own level while also facilitating a team environment.” 

Gomez has extensive fitness industry experience, having previously served as Solidcore’s Director of Training and as the Director of Trainer Operations for Openfit, Beachbody’s virtual platform.

Meagan Robar, Ambition’s Head of Experience, will be accompanying Gomez. Robar has also worked at Solidcore and has worked with companies such as Lululemon, Equinox, and Disney. Jayson Siano, Founder and CEO of Sabre Real Estate, will serve as Lead Development Advisor for Ambition, and Stephanie Finigan will serve as Chief of Staff.

The post Solidcore Founder Launches Ambition, Bringing the Ultimate Fitness & Wellness Experience appeared first on Athletech News.

Beachbody shares (NYSE: BODY) dropped 27.5% as investors responded to less-than-stellar third-quarter results. The fitness company reported that sales were down 17%, with CEO Carl Daikeler calling the results “unacceptable.” Despite lukewarm numbers, Beachbody says at-home fitness is here to stay and is looking ahead towards digital and connected fitness. 

In the earnings call before the drop in shares, Daikeler, Beachbody co-founder and CEO, said that July and August were in line with the company’s expectations but noted that September was more challenging than anticipated. Daikeler said new subscriber acquisitions were lower due to softer consumer demand, a complex media environment, and delays in key product launches. He noted that Beachbody retained existing subscribers but that the company would be improving customer acquisitions.

“Make no mistake, as the single largest shareholder as well as CEO of Beachbody, but more so because I believe in the importance of our mission to serve as many people as possible; this is deeply personal to me,” Daikeler said on the call before Beachbody shares plummeted.

Beachbody reported a 5% drop in digital revenue, and nutritional revenue took a 29% dive, which Beachbody said resulted from nutrition being linked to digital subscriptions. Launch delays and marketing inefficiencies led to a disastrous domino effect for the nutrition segment, says the fitness company.

Calling Beachbody’s results “unacceptable,” he went on to say that the company knows how to respond with a focus on the consumer and continue delivering a fitness and nutrition system that is cost-effective for its customers. Daikeler noted that consumers might just be distracted with returning to pre-pandemic life, like traveling, socializing, or spending time outside the home.

“Put plainly, at home fitness is not a passing trend that grew out of the pandemic. It’s here to stay. Our performance versus 2019, including solid growth in subscriptions and solid retention and engagement is evidence of that long-term trend. There’s no denying the consumer is experiencing a moment of distraction,” the CEO said in the call. 

Beachbody leaders also point to rising media costs and Apple’s iOS 14.5’s new privacy settings, which they say made performance marketing increase in price and less efficient. BOD Interactive, a new live group fitness subscription, was also delayed because the company needed more time to ensure that the tech used would provide its desired immersive experience. Calling it a domino effect, the delay of BOD Interactive also had an impact on bike sales because of its interactive cycling content.

“As a result, we did not begin to aggressively promote the bike in our coach network and on social media until late October as we needed the BOD Interactive launch to be able to truly unlock the full value proposition,” Daikeler explained.

Beachbody is now focusing on the holidays and then looking to the first quarter when the company says most people reset and refocus on health. 

Beachbody noted that it has streamlined its marketing organization, allowing for a “faster feedback loop” between creative, media, data, and analytic teams. The company says this will assist with identifying winners.

The company will also scale its connected fitness business. Beachbody’s CEO acknowledges this is a competitive market but says that the company’s existing 3 million subscribers, bike, and nutrition plans and supplements, put the fitness company in a position to accelerate. The Connected Bike, Daikeler said, will enhance the lifetime value of Beachbody’s customer base. 

The fitness giant said it would put its attention on the network of coaches. Beachbody will be releasing a program called Job 1, by Super Trainer Jennifer Jacobs, which will roll out in December. The company will also be launching new nutritional products in 2022. 

“Like others in the industry, the volatility in consumer demand we experienced in the third quarter as the economy began to reopen, was greater than anticipated. But looking past the near-term turbulence, we remain confident in our unique value proposition and the long-term secular tailwinds at our back,” said Sue Collyns, President and CFO.

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