ClassPass

ClassPass
Industry Fitness
Founded 1 June 2013
Founders Mary Biggins, Payal Kadakia
Headquarters New York City
Website classpass.com

ClassPass is an American fitness startup company based in New York City and founded by dancer Payal Kadakia and Mary Biggins.[1] The company offers a flat-rate monthly subscription service to get access to participating fitness classes in 30+ American cities, as well as in Toronto, Vancouver, Sydney, Melbourne and London.[2] Sanjeev Sanghavi was the company's cofounding partner—he left in January 2014.[3] Before starting the company, Kadakia worked for Warner Music and is a graduate of MIT.[4][5]

History

The company was originally called DabbleNYC, then renamed to Classtivity. An earlier version of the company's product was intended to sell a better registration system to fitness studios but this did not receive much interest.[6] After participating in the TechStars accelerator, the company switched to offering a package deal where users could pay $49 for ten classes in a year, a model that Kadakia likened to Groupon. Users of the service wanted to use the pass service again so the company switched to offering the 'Passport', a subscription service for $99 a month.[7] The company enforces a cancellation fee of $20 for missing classes.[8] As of 2016, ClassPass has booked over 17 million fitness reservations.[9]

Founders

Payal Kadakia

Payal Kadakia is the CEO and co-founder of ClassPass. She is an Indian American trained in Indian classical dance,[10] and grew up in Randolph, New Jersey.[11] In 2005, she graduated from MIT with a degree in Operations Research.[12][13] After college, Kadakia worked as a consultant at Bain & Company.[14] She went on to work at Warner Music Group. In 2008, while working at Warner, she also founded Sa Dance Company.[13][14]

After spending over an hour searching online for an open ballet class she could take, Kadakia had the idea to create a search engine for fitness classes, similar to OpenTable.[15] In 2011, Kadakia founded Classtivity with her then business partner Sanjiv Sanghavi. In January 2014, Classtivity was rebranded as ClassPass.[16]

Funding

ClassPass received seed funding of $2 million in March 2014, then attracted $12 million in Series A venture capital funding from entrepreneur Fritz Lanman in September 2014. In 2015, it closed a $40 million round of Series B funding from General Catalyst and Thrive Capital.[17] The company was valued as being worth more than $200 million according to a report in the Wall Street Journal.[18]

Criticism

The service has attracted criticism for undercutting the business model of the fitness studios that it relies on, with an article in the New York Times describing it as a "middleman" between consumers and fitness studios, and arguing that a "power imbalance" exists between the studio owners and ClassPass which mirrors the relationship with other digital intermediary services like Amazon.com and Uber.[19] A perhaps unintended consequence of the ClassPass business model is that in Washington, DC, users do not have to pay sales tax for the subscription as they would have to if they were paying directly for classes or memberships at the individual workout studios.[20]

See also

References

  1. ↑ Alyson Shontell (31 July 2014). "How Getting Mugged And Maced Helped A World-Class Dancer Save Her Struggling Startup". Business Insider. Retrieved 10 August 2015.
  2. ↑ Hafsa Lodi (31 December 2015). "The pros and cons of fitness-pass packages". The National. Retrieved 3 July 2016.
  3. ↑ Chloe Sorvino (17 June 2016). "Why Failing Twice Helped ClassPass's Payal Kadakia Build A $50 Million (And Growing) Fortune". Forbes. Retrieved 3 July 2016.
  4. ↑ Sheila Marikar (3 November 2014). "How one fitness entrepreneur raised $14 million". Forbes. Retrieved 17 March 2015.
  5. ↑ Anna Maltby (27 January 2015). "This Company Will Get You Into Unlimited Fitness Classes". Fast Company. Retrieved 17 March 2015.
  6. ↑ Alyson Shontell (31 July 2014). "How Getting Mugged And Maced Helped A World-Class Dancer Save Her Struggling Startup". Business Insider. Retrieved 17 March 2015.
  7. ↑ Stephen Altrogge (17 November 2015). "Monthly Lifestyle Subscriptions Are a Thing With Companies Like Wonderush". Snapmunk. Retrieved 3 July 2016.
  8. ↑ Stephie Plante (20 January 2015). "ClassPass: Is the Fitness World's Latest Obsession Worth $54 Million?". Racked.com. Retrieved 17 March 2015.
  9. ↑ Jordan Crook (13 April 2016). "Classpass rolls out new pricing structure". Techcrunch. Retrieved 3 July 2016.
  10. ↑ Accessed October 25, 2016.
  11. ↑ "Payal Kadakia". gothamgal`. Retrieved 10 February 2016.
  12. ↑ "Payal Kadakia". MIT. Retrieved 10 February 2016.
  13. 1 2 Arata, Emily. "I Want Your Job: Payal Kadakia, Cofounder And CEO Of ClassPass". EliteDaily.com. EliteDailyy. Retrieved 10 February 2016.
  14. 1 2 Gregoire, Waylae. "Payal Kadakia: How She Turned Her Love of Dancing Into a Startup Venture". Nextshark.com. Nextshark. Retrieved 10 February 2016.
  15. ↑ Marikar, Sheila. "How one fitness entrepreneur raised $14 million". Fortune. Retrieved 10 February 2016.
  16. ↑ Carson, Biz. "How this world-class dancer went from failing twice to a $400 million fitness empire". Business Insider. Retrieved 10 February 2016.
  17. ↑ Jordan Crook (15 January 2015). "Classpass Is In Session With $40 Million In Series B". TechCrunch. Retrieved 17 March 2015.
  18. ↑ Yuliya Chernova (12 March 2015). "ClassPass, Valued at More Than $200M, Taps Into Gym Craze". Wall Street Journal. Retrieved 17 March 2015.
  19. ↑ Jenna Wortham (9 March 2015). "ClassPass and the Joy and Guilt of the Digital Middleman Economy". New York Times Magazine. Retrieved 17 March 2015.
  20. ↑ Vicky Hallett (7 October 2014). "ClassPass lets you take as many fitness classes as you want all over D.C. for $99 a month". Washington Post. Retrieved 17 March 2015.
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