ClassPass has unveiled its latest innovation: the integration of food and beverage options into its bookable experiences. With tens of thousands of studios, gyms and spas already on the platform, ClassPass is now introducing ways for its members to refuel after workouts or wellness visits. 

“After we expanded into beauty and wellness offerings in 2018, we were eager to continue to find ways to bring more experiences to our members. Food and beverage always felt like the natural next step,” said Fritz Lanman, CEO of Mindbody and ClassPass. “Our members have come to realize wellness is so much more than fitness – and it means something different to everyone. We are excited to continue to expand our offerings to fit our members’ wellness lifestyles.”

Since its founding in 2013, ClassPass has evolved from a pure fitness booking platform to a more holistic system. With the new launch, ClassPass users in New York and Miami can now redeem their credits for snacks and meals at participating locations. Additional restaurants and eateries in new cities will be rolling out in the next few months, the platform said.

ClassPass was acquired by Mindbody in 2021, after a tumultuous couple of years during the pandemic. Now that in-person experiences are back and bigger than ever, the platform has been capitalizing on consumers’ desire for holistic, community-driven in-person experiences.

Entering the food and beverage brings ClassPass a step closer to being a one-stop shop for health and wellness-focused consumers. By entering the wellness-focused food and beverage category, the platform and its parent brand Mindbody are looking to disrupt the a that’s been dominated by established players like UberEats DoorDash, and even local smoothie shops. 

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Mindbody CEO Fritz Lanman has a compelling answer when asked why the software provider is trusted by so many health and wellness companies, including some of the biggest names in boutique fitness. 

“You make more money from Mindbody than you make from any other platform,” Lanman says. “The average business grows 36% after they join Mindbody in their first six months.”

A key reason for that growth is that Mindbody’s customers get access to the 1.9 million active shoppers who use the software company’s consumer-facing app to book services like boutique fitness classes. According to Lanman, it’s the largest concentrated pool of active wellness shoppers on Android or iPhone. 

“If you want to get your business in front of that many people, the alternative would be to pay Facebook, Instagram or Google for ads,” the Mindbody CEO notes. “For that spend, the ROI isn’t guaranteed. In our system, we have tools that drive discoveries for you. If we can prove through a consumer survey that we discovered a person for you, we’ll take a fee on that purchase. But it’s guaranteed ROI, since you’re only paying if you get discovered.”

In 2021, Mindbody acquired ClassPass, a monthly subscription service that allows users to book last-minute seats in gyms, studios and spas. The deal gave Mindbody’s customers access to even more potential members. To alleviate any concerns studios may have about selling seats for less than full cost, Mindbody offers its customers a 90-day ClassPass guarantee: if using the subscription service doesn’t make them money, Mindbody promises to pay them back twice what they lost. 

Since the acquisition, “a lot more of the Mindbody customer base is taking advantage of ClassPass to grow their businesses,” Lanman says.

When It Comes to AI, Data Is King

Looking ahead, Minbody has its sights set on a new way to help its customers grow their businesses: artificial intelligence and machine learning. 

“We’re starting to layer in a ton of features that help you grow your business even more, including machine learning and AI-powered tools that help business owners do things like convert more prospects, retain their audiences better, drive more purchases and get more bookings,” Lanman says.

Minbdody’s size makes it uniquely positioned among fitness and wellness software platforms to leverage the powers of AI, Lanman believes. 

“With these large language models, businesses that have huge datasets don’t have to invent new math, we all can use the same techniques and open-source models,” he explains. “The key is, which players have enough data to make the AI good? Mindbody has the biggest platform. Because of our scale, we have the data to do things with AI that our competition can’t.”

Mindbody’s AI Plans

Lanmnan shared some of Mindbody’s current and upcoming initiatives around AI and machine learning. 

Already up and running is a feature called Messenger[ai], Mindbody’s AI-powered front-desk assistant, which automatically responds to missed calls, fields questions and helps clients book and buy services.

“At its core, it’s a chatbot,” Lanman explains. “It’s a widget that you put into your site. So on your business webpage, when a prospect comes in, it can ask them questions like, ‘What availability do you have for an appointment?’ A client can actually go all the way through the booking process just by interacting with the chatbot.”

The Messenger[ai] feature should prove popular with Millenials and GenZers, who typically prefer a human-free purchasing experience online. 

“Younger consumers want to be able to just chat, they don’t want to have to pick up a phone to book an appointment or a class,” Lanman notes. “It also means you don’t need to have somebody manning the front desk to get a booking.”

Another feature Mindbody has started rolling out to some customers is called Clients At Risk, which essentially uses AI to identify which members are likely to stop coming into class. 

“The AI shows customers the folks it thinks are losing their motivation before you’ve actually lost them,” Lanman explains. “That gives you time to act. Go have an intervention with that person, give them a phone call, send them an encouraging text or give them an offer for a discounted personal training session or appointment to hook them back in.”

“It’s essentially retention AI,” he adds. “In the fitness industry, especially in wellness, retention is as big a priority as customer acquisition, because people lose their motivation for wellness and fall out of their routine.”

For Mindbody’s customers using the Clients At Risk tool, the early results have been “spectacular,” Lanman says. 

“The businesses using the feature are seeing 30% of those clients be more engaged after just exposing the feature to them,” he notes.

Mindbody is also using AI and machine learning in its consumer-facing app to drive more people into studios.  

“We’re using machine learning on search and navigation,” Lanman says. “How can we better match wellness shoppers to wellness businesses and drive as many purchases as we can?” 

Another AI feature Mindbody is working on is called “big spender analysis,” although it hasn’t yet been released. 

“When a prospect walks into your door, how do you know if they’re going to be one of the big spenders, one of the people who really buy into your business and stays active?” Lanman explains.

Mindbody also plans to use AI to help studios evaluate which of their instructors are likely to become successful in attracting clients.

Beyond AI, Lanman says he’s encouraged by the progress Mindbody is making in improving the speed and reliability of its software in general. 

“Mindbody is a little old. It was built a long time ago,” he admits. “So most of our engineering calories are actually going into just making Mindbody incredibly performant, reliable, fast and responsive, and modernizing the UI.”

Those updates, combined with the company’s push into AI, have Lanman excited about what the future holds.

“We already grow businesses more than any other platform, we already have more features than any other. We also have AI that no one else can do because they don’t have our data scale,” he says. “And then you add to that, software that’s getting faster, more reliable and more usable.”

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Mindbody has forged a multiyear strategic partnership with Shoot 360, an immersive basketball training experience. The deal will see Mindbody’s leading technology optimize Shoot 360’s operations and enhance its customer experience as the basketball training brand expands.

“We’re thrilled to team up with Shoot 360 to help manage and scale its advanced concept in the coming years,” said Fritz Lanman, CEO of Mindbody. “As we continue to innovate with technology, sport, and wellness, Shoot 360 raises the bar for basketball training and competition. I am confident our software will expand their reach and help continue to scale the Shoot 360 experience.”

The immersive basketball experience concept was created by Craig Moody, the brand’s president and founder. Moody opened the first location in Beaverton, Oregon, in 2012, and now offers franchising opportunities.

Shoot 360 uses science and technology to offer instant feedback for players in a gamified setting, with audio and visual assessments on every shot made. The basketball training experience also tracks shooting percentage and measures left/right differentials and other elements to improve accuracy. 

Aside from perfecting the perfect shot, the basketball brand also provides a great workout with its gamified approach where players can engage in a virtual competition and offers personal training sessions with coaches working with athletes to develop a program to maximize their personal development.

The basketball training brand is expanding, with plans to open new facilities in 11 different states. It recently highlighted Charlotte Hornets players Bryce McGowens and Nick Richards at its Charlotte location. 

“Mindbody is a perfect partner for us as we continue to scale and bring our advanced technology to various facilities across the United States,” said Jason Grant, chief technology officer of Shoot 360. “We are passionate about the game of basketball and bringing this new wave of sport and gaming to the masses.”

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ClassPass, one of the leading fitness and wellness memberships, announced its multi-year partnership with SoulCycle, the full-body cycling experience, which is now bookable on the ClassPass app.

“We have heard our members’ rally cries to add SoulCycle to our network,” said Fritz Lanman, CEO of Mindbody and ClassPass. “ClassPass brings members the world’s best fitness and wellness experiences, and we are thrilled to partner with SoulCycle to include this iconic lifestyle brand into our portfolio.”

As cycling is one of the most popular in-person fitness reservations booked on ClassPass, SoulCycle’s presence on ClassPass will likely bring more riders to the platform. In 2022, ClassPass saw a 95% increase in in-person fitness reservations from 2021. With more than 60 studios across the U.S. and London, SoulCycle has a dedicated following, who love its pulse-pounding playlists and dance choreography within candlelit studios.

The news comes after Mindbody and ClassPass announced layoffs this fall, citing increased economic uncertainty and inflationary pressures, which have slowed progress and created new challenges for the fitness industry. The partnership with SoulCycle represents the platform expanding to consumer groups like SoulCycle riders who have previously remained loyal to the brand, in the hopes that they will branch out to the ClassPass platform’s other offerings. 

“We are delighted to partner with ClassPass to share the magic of Soul with their members. SoulCycle is an extraordinary workout, one that exercises the mind, soul and body,” said Evelyn Webster, CEO of SoulCycle. “It’s an incredible opportunity to bring our legendary instructors, welcoming community and the thrill of the original cardio dance party to a wider audience.”

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Mindbody platform users will be able to enjoy what smart building company Brivo has to offer, due to a newly announced partnership between the two. Brivo, which is a cloud-based access control business, helps customers with their security needs. Now with Brivo and Mindbody’s alliance, studio owners and health and fitness companies alike on the Mindbody platform can use Brivo Access to keep members, businesses, and assets protected and secure under this model product.

In regards to the news, Mindbody and Class Pass CEO Fritz Lanman states, “As the wellness industry continues to adapt to the changes brought on by the pandemic, we are thrilled to partner with Brivo to offer our customers a flexible security option that benefits members, employees, and management. With Brivo, studios can access and manage their facility anywhere, anytime, while simplifying security and surveillance.”  

Brivo CEO and Founder Steve Van Till, who expressed his elation about his company’s union with Mindbody, says in a press release Mindbody consumers who take advantage of Brivo Access can enjoy greater facility management and member experiences. “Brivo’s cloud-based access control solution delivers to Mindbody proven security technology, giving owners and employees comfort and control at their fingertips and a frictionless experience for members,” adds Van Till.

The partnership arrives several months following the launch of Mindbody Capital. Mindbody Capital Director Shari Castelli exclusively told Athletech News in March business owners were investing funds from Mindbody Capital into staff and hiring, along with new marketing campaigns and new equipment. Castelli noted many owners admitted retaining and rebuilding staff post-pandemic had been “difficult.” Mindbody’s new initiative with Brivo may very well prove to usher in more quality products, whether in cloud-based security or not, to assist health and wellness space business leaders seeking to keep and add new clients in a post-pandemic world.

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Wellness technology platform Mindbody has announced a strategic alliance with Corporate Sports Unlimited, Inc., a fitness center management, consulting, and wellness solutions company. Corporate Sports Unlimited will now serve its customers’ fitness and wellness facilities using Mindbody’s technology. 

According to Corporate Sports Unlimited, the partnership will streamline and improve its member management and retention processes, payment processing, scheduling, and reporting.

“Corporate wellness programs are becoming increasingly important, if not essential, as wellness continues to be more important than ever. Mindbody data shows that when looking at potential new employers, 42% say that wellness perks/benefits are an important part of making their final decision,” said Fritz Lanman, CEO of Mindbody and ClassPass. “With that in mind, we are grateful to partner with Corporate Sports Unlimited to bring their customers’ employees a seamless experience that allows them to break down barriers to prioritizing their health.” 

Lanman was recently appointed as MindBody’s new CEO, succeeding Josh McCarter, who has moved to the MindBody Board of Directors.

Corporate wellness is on the rise, with Research and Markets projecting a $90.4 billion global corporate wellness market by 2026. Employees who work for companies that provide wellness programs are happier and report experiencing less illness. Such wellness programs can even reduce healthcare costs and absenteeism. And, as Lanman pointed out in an interview with Athletech News last month, most consumers say that wellness is more important than ever coming out of the COVID-19 pandemic.

Georgia-based Corporate Sports Unlimited was founded in 1980 as a corporate event planning company but has since expanded to include Corporate Health Unlimited, a division that caters to the needs of the health and wellness industry. The company offers programs and services to major corporations, global headquarters, Class A office developments, hospitals, resorts, and hotels.

“Our team manages a vast assortment of facilities that thousands rely on to take care of their personal wellness. With Mindbody’s flexible and easy-to-use platform, we can achieve our goal and commitment to ensure members receive a stress-free and reliable experience across all facilities,” said Donald Whitney, Founder, President, and CEO at Corporate Sports Unlimited.

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Effective September 3, 2022, Fritz Lanman has been appointed the new Chief Executive Officer of Mindbody, the leading technology platform for the wellness industry. Athletech News spoke to Lanman about his strategic vision for the company, and the greater state of the fitness and technology industry.

Athletech News (ATN): What brought you into this space, and what are you most excited about with the future of fitness and technology?

Fritz Lanman: I spent close to a decade at Microsoft out of undergrad as a Product Manager and then running the Corporate Strategy group there. Then I switched and became an entrepreneur and an angel investor. I actually got involved in the space originally by investing in ClassPass. I led the seed round when the company was actually called Classtivity. I met Payal [Kadakia], the Founder, and just fell in love with the opportunity. I led its Series A six-to-twelve months later. I was just spending a ton of time with Payal on business advising and she wanted me to be an Executive Chairman. In December 2015, Payal asked me to step in and take the operating reins of ClassPass.

I was just super passionate about the technical problems in the space, the ability to help wellness merchants be better businesses, and the ability to inspire people to live healthier, happier lives. Here I am, close to seven years later. We obviously then were acquired by Mindbody about ten months ago. When Josh [McCarter] and the Board presented me with the opportunity, it was a pretty easy decision to say, ‘I’d like to double down on pursuing this mission of bringing great technology into this category. Helping merchants build better businesses, inspire more lives. And helping end users live happier, healthier, longer lives.’

ATN: What will be your first priority for Mindbody in this new role?

Fritz Lanman: I think what’s interesting about Mindbody is that it’s a category leader, who essentially invented the SaaS wellness business. It’s a profitable business, and it’s extremely well-capitalized. So, I’d say the first priority is to not break anything. And then the second priority is to finish this three-year product transformation that Mindbody has been undergoing. ClassPass, the category leader, was first built around 20 years ago, and the executive team has done a great job not only bringing the company through the pandemic, building video products that Mindbody customers could launch livestream classes during the pandemic, etc., and have migrated Mindbody to the cloud. So, cloud migration, a total UI/UX overhaul, and increasingly, launching new AI/ML-enabled features. We have a product called Messenger AI that allows a user to go to a salon’s website or a fitness website and make a booking without having to talk to a human.

I’m first fired up about just making sure we finished the job on that product transformation. We’re approaching the full completion of that three-year journey, but we have to run through the finish line. And then I’m really fired up to start leveraging some of my expertise building large-scale distributed systems, and especially ML systems, to figure out how we use it to help these customers build better businesses. And I see a tremendous amount of opportunity there.

ATN: How will Mindbody and ClassPass shift as consumer needs change, and where is the industry now?

Fritz Lanman: The industry itself is largely achieving recovery, kind of surpassing pre-pandemic reservation volumes. We were worried about whether there would be this massive transition or permanent transition to digital. Luckily, Mindbody’s position is to sell digital products to studios if they want to add digital classes. What we learned is that there’s a consumer who wants to pay for digital experiences, and then there’s a consumer who will do digital, but really only wants to pay for in person. Once somebody goes back after a period of absence during the pandemic, they’re actually going back 10% more than they were before the pandemic. What we hear from the Mindbody and ClassPass consumer is predominantly that they prefer these in person experiences, or that they’re willing to pay for them because they want specialized equipment. They want that community experience. The Mindbody consumer app and ClassPass are both up and to the right in terms of growth, engagement, the number of bookings that we’re seeing. The industry, I think, is going to emerge from the pandemic stronger than it was before.

ATN: Is there anything you’re concerned about in the current fitness technology world?

Fritz Lanman: I would have said digital maybe two years ago, right after we were in the pandemic, both for Mindbody and ClassPass. But about two-thirds of people believe in-studio classes make it easier to work out regularly and maintain a routine. So, we think an in-person experience, maybe even a variety of experiences, is the best way to stay motivated to work out. And the vast majority of consumers, I think 75%, according to our last study, are saying that wellness is more important than ever coming out of the pandemic. So, a weird tailwind or benefit of the pandemic, is this consumer mindset and commitment to wellness and well-being. A lot of our consumers, both for the Mindbody app and for ClassPass, want to supplement with digital.

So, I would say the biggest risk to our industry isn’t people stopping working out in person, but it’s what the next pandemic will be—for example, monkeypox. And I’d say the recession, or the risk of an inflationary-driven recession is just necessitating that things will need to be a little more expensive for Mindbody customers, but that isn’t specific to the fitness industry. If you zoom in, you see these near-term disruptions from COVID, or potentially the next pandemic, or inflation. But if you zoom out, you see a super strong exponential growth curve in this industry. And the benefit of ClassPass being in 30 countries is that it’s not a U.S. phenomenon—it’s something that we’ve seen throughout Southeast Asia, Europe, and Latin America.

ATN: What is your long-term vision for Mindbody?

Fritz Lanman: Our near-term vision is the product overhaul of the core Mindbody experience. The biggest risk to the industry is our businesses not having the tools they need to grow their businesses. The second is finishing the job on Mindbody and ClassPass. We’re going to guarantee to businesses that Class Pass will be accretive. If you’re a studio joining ClassPass, Mindbody will pay you double what you’ve lost. Third, we’ve launched a product called Mindbody Capital. It’s made it easier using Mindbody and ClassPass’s best data for lenders to underwrite loans in real time to these small businesses. We’ve so far advanced over $9 million in financing, and that’s again been critical for these small businesses struggling, coming out of the pandemic, or trying to launch.

Then, in the medium-to-long term, I see the incorporation of ML and AI into the space. We have a suite of 50 ideas for ways that we can continue to enhance and automate things like customer acquisition and retention and just bring to bear great tech to these studios to make their businesses better. Then, I see geographic expansion on horizon for Mindbody. It’s predominantly an American business with a large presence in Australia and the UK and a few other markets, English-serving markets. But ClassPass went from four countries to 30 in two years. We’ll have earned the right at Mindbody to kind of get our presence established across many more languages, much more of the globe, since wellness is a global phenomenon. Last, I think, is adjacency expansion. Mindbody originally was really designed for yoga and then all of studio fitness. Then, we built spa and salon experiences and we acquired Booker. There are a lot of physical and wellness activities out there that would benefit from really great software. So that’s the kind of longer-term vision: expanding on those geographic and vertical-adjacent areas.

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If you’ve ever signed up for a yoga or meditation class, chances are you used Mindbody. Well-known wellness tech platform Mindbody announced Wednesday that it would be acquiring female-founded ClassPass, a monthly subscription service that unlocks an extensive network of wellness experiences, including gyms, spas, studios, and salons.

With Mindbody and ClassPass intertwined, consumers and business owners will have a seamless experience, in a time when people are eager to head back to in-person fitness classes.

CEO of Mindbody, Josh McCarter, told Athletech News that the pandemic has pushed wellness to the forefront, and both companies will work together to help people on their journey to fitness as well as support businesses in a post-COVID era.

“COVID has been a stark reminder for everyone about the importance of staying happy and healthy,” said McCarter. “By joining forces, Mindbody and ClassPass will power a new era by making wellness accessible to more people in more places and help businesses around the globe to rebound in the process.” 

Mindbody has also secured a $500 million investment from global investment firm Sixth Street. The firm’s portfolio of investments include AirBNB, Datavant, Legends, MDLive, the San Antonio Spurs, Spotify, and Sprinklr. The Sixth Street funding accompanies Vista Equity Partners, Mindbody’s majority investor. The funding will be used for growth and future innovations. Mindbody’s move to acquire ClassPass has sparked talks of a possible upcoming IPO. 

Fritz Lanman, CEO of ClassPass, said that the joint effort will be a game-changer in terms of revenue.

“Today is an incredibly exciting day for ClassPass, for Mindbody, and for the fitness industry,” Lanman told Athletech News. “With this deal, we will bring our SmartTools technology to more businesses around the world and help them to turbocharge revenue optimization. We will also work with Mindbody to improve the consumer experience, making it even easier to discover and book top-rated spa and fitness experiences everywhere you travel.” 

The acquisition comes at a pivotal time in the fitness industry. Mindbody says that 80% of consumers feel that wellness is more crucial than ever before, and data from the Mindbody and ClassPass platforms shows that bookings are back to pre-Covid times. 

ClassPass was founded by Payal Kadakia, an MIT grad that had the idea to create a search engine where a user could find and book fitness classes back in 2011. By the end of 2017, ClassPass had 45 million reservations.

“Since the founding of ClassPass, our north star has always been how we can help people discover and seamlessly book soul-nurturing experiences,” said ClassPass founder Payal Kadakia in a press release. “This acquisition will be a massive milestone for a female-founded company, and I am confident in the leadership of Josh McCarter and my long-time business partner Fritz Lanman to propel the business forward and continue to deliver a best-in-class experience for consumers and business owners alike.”

The company will also introduce Mindbody Capital, which will allow small business owners to obtain financing to help them grow.

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Xponential Fitness, the largest boutique fitness franchisor, today named ClassPass the exclusive aggregator for all eight of their brands worldwide. Xponential is the curator of leading brands across every vertical of the boutique fitness space, with a portfolio that includes Club Pilates, CycleBar, StretchLab, Row House, AKT, YogaSix, Pure Barre and STRIDE. In addition to almost 1600 studio locations in the US and Canada alone, Xponential has close to 4000 franchise licenses sold across 10 countries. With this partnership, any Xponential studio or franchisee who opts to market in-person or digital fitness classes through an aggregator will do so through ClassPass.

“Our brands have seen proven benefits from ClassPass’s transition from the Unlimited model to Credits and the release of its inventory management tools for studios,” said Anthony Geisler, CEO of Xponential Fitness. “Given the positive impact ClassPass has had for our franchise partners, we are excited to enhance the partnership, especially as ClassPass continues to rapidly acquire new corporate and enterprise clients.”

Founded in 2013, ClassPass is the largest aggregator of fitness and wellness brands. ClassPass offers access to 30,000 studios, gyms and wellness providers, as well as a growing catalog of on-demand and livestreamed digital fitness options. In addition to building the largest B2C fitness marketplace in the world, ClassPass also entered the employee benefits space in 2019. ClassPass now partners with more than 2,000 corporate clients, equipping employers with flexible Corporate Wellness options for their teams. Individual subscribers and professionals on employee-sponsored plans will both have access to Xponential’s suite of high energy, motivating workouts. 

“ClassPass curates the top fitness brands in the world, all through one membership. Xponential brands such as Club Pilates, Pure Barre, CycleBar and Row House are some of the most popular and sought after classes by our members, and we’re thrilled to add on-demand and livestream video content as part of this expanded partnership,” said Fritz Lanman, CEO of ClassPass. “This multi-year deal will provide our corporate clients with exclusive access to Xponential brands, something no other Corporate Wellness program offers.”

ABOUT XPONENTIAL FITNESS:

Founded in 2017 by Anthony Geisler, Xponential Fitness has built and curated a diversified platform of eight disruptive boutique fitness brands spanning across fitness and wellness verticals – including Pilates, indoor cycling, stretch, rowing, dance, running and yoga. Currently, Xponential Fitness’s portfolio of brands includes Club Pilates, the nation’s largest Pilates brand; CycleBar, the nation’s largest indoor cycling brand; StretchLab, a concept offering one-on-one assisted stretching services and group stretch services; Row House, a high-energy, low-impact indoor rowing workout; AKT, a dance-based cardio workout combining toning, interval and circuit training developed by Celebrity Trainer Anna Kaiser; YogaSix, a modern boutique yoga brand; Pure Barre, a total body workout that uses the ballet barre to perform small isometric movements; and most recently, Stride, a treadmill-based cardio and strength training concept. Visit www.xponential.com to learn more.

ABOUT CLASSPASS:

Founded in 2013, ClassPass is a membership that provides access to the world’s largest network of fitness and wellness experiences. ClassPass partners with more than 30,000 pre-vetted exercise studios, health clubs and wellness providers to offer a broad range of digital and in-person classes including yoga, cycling, Pilates, strength training, boxing and more. In addition to workouts, members can instantly book inspiring wellness experiences, such as massages, acupuncture, and spa treatments. ClassPass also helps studios around the globe to merchandise their excess inventory, find new customers and generate new streams of revenue. Learn more at http://classpass.com.

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