Bryan O'Rourke - The Intersection of Fitness, Technology, and Global Trends

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[00:02:37] Learn more at matabolic.com. That's M-A-D-A-B-O-L-I-C.com. All right, we are live. Brian O'Rourke, welcome back to the Future of Fitness. It's good to see you. Eric, it's always a pleasure, man. Do you have a good holiday? It was great. It was great. I skied my butt off. We call it our ski staycation because we're seven minutes from the resort here and had friends come to us, family come to us.

[00:03:05] And can't complain. As I was telling you prior, the only complaint I have is I felt like it was too long. I feel like I'm knocking off rust this week back into it. How was yours? It was great. I got to get back to New Orleans for about 10 days in my main home there, and that was nice to be with family. So that was nice. But now I'm in California watching these wildfires, and boy, my heart's going to go out to those folks. I mean, what a devastating event.

[00:03:29] Yeah, it's rough. It's hard to watch. And I guess I know people who have lost their homes already. And yeah, we'll just see where it goes. I wish it was something that we're not going to hear more of over the next 5 to 10 years, but I feel like it's something that we're going to have to really kind of deal with in a very meaningful way. Yeah, sadly. Yeah, it is. It is. Well, you know, there's always a million things we can talk about, Brian. And I really appreciate the content that you put out. You have your Fitness Plus Technology podcast, which is excellent, top-notch in the industry.

[00:03:58] And I always wonder, like, you're the CEO of Core Health and Fitness. Where do you get time to create all the content? That's interesting to me. And why do you create the content when you're obviously a very busy man? You don't need to do it. Is it something you enjoy? And yeah, I mean, let's start with that. I'm curious about that. Yeah. Well, you know, personally, there's a number of things to that. I mean, first, the practice of doing the content itself forces you to think.

[00:04:24] And today's world, you know, Arari's book, Nexus, which recently came out, he's the author of Sapiens, etc. He talks about information networks. And the challenge we have today is information versus truth. And truth is a lot harder to distinguish nowadays. And so I try to contemplate it. I think in this role or in any role or as a participant in the global fitness community, which I think myself as being as you are and others.

[00:04:53] So I find it as an internal necessity to sharpen my own sword, to research and constantly contemplate tying in what you're seeing all the time and different information with what is actually going to happen. And that informs our businesses, obviously. I have over a dozen companies, this being the main one that we're working on.

[00:05:13] But, you know, I think today really trying to think about what is happening and creating construct around that helps to inform not only me, but also our partners, our customers, our colleagues. So we can have a conversation like you and I are. And hopefully that informs us all to focus on the things that are most meaningful and to anticipate as much as we can about the marketplace in general.

[00:05:40] Yeah, well said. It is interesting. And you and I just talked about this prior to recording. Our industry loves the hype cycles. We tend to grasp onto, you know, three, four things throughout the year that whether they're even the most relevant or important things doesn't really matter. We just tend to grab them. And then every event I go to, people are speaking on them and we're talking about them, regurgitating information that we've heard. You know, now I was looking at the presentation that you put forth and, you know, trends and emerging opportunities for the year.

[00:06:08] You know, I can tell there's depth to that and some stuff that I haven't really covered or talked about much, which piques my interest because it seems outside of the hype cycle. So we're going to cover some of that for sure, because we can't cover all of it. There's a lot. You put a lot out there. But maybe let's start with this. Like, how was your 2024, Brian? How did you do? How are things at core? How do you think the industry did? Let's start with that. Well, first off, good health and family and friends. And so that's the most important thing. Knock on wood.

[00:06:35] But the second thing is, you know, we've been very fortunate in all of our companies. I was able to sell one of our businesses in Vertamax, which is an investment we had had for almost seven years. So that was great for our partners. In core health and fitness, we had and we're a privately owned company, so I can't be too disclosive. But, you know, our revenues and bookings were up significantly and we're very fortunate to have a very robust year. So I was happy to see that. And, you know, in general, you know, outside of my directs fee,

[00:07:06] you know, there are a lot of mega deals that happened this year. I mean, you saw the Pure Gym acquisition. You saw the merger of, you know, Anytime with Rourke and Orange Theory. You know, there's a lot of big news happening, you know, basic good acquiring a group out of Spain. So there's a lot of M&A activity as well and direct investment. You know, E-Gym getting a billion dollar valuation with the recent investment by El Catertain.

[00:07:32] And, you know, so I could go on and on in one life's transaction, which was significant. You hear the news. I really think this year or last year now, the M&A side of the businesses has been pretty, pretty profound. Yeah. Yeah. It was a really interesting year. I mean, especially coming off the which feels like a lifetime ago of the pandemic years.

[00:07:53] You know, I feel like we normalized conversations, got back to growth and business and consumer demands and all the stuff that really is important for us to get out and accomplish what we want to do as an industry, which is, you know, make the world a healthier place. Right. So I'm looking at this presentation and maybe you can give us some. It's called the Future of Fitness 2025. Great name, by the way. Really good. Very sharp. Did you trademark that? I should have asked you. No.

[00:08:21] Yeah, it's a long story we can talk about offline. I've looked at it several times, but yeah, I don't want to. Yeah. Trends and emerging opportunities. I'm looking at one of the sites. It's a very long presentation. How long did that actually take you to do it when you presented it? Was it over an hour? So every year I do kind of a, you know, it took me an hour to present. The deck itself took me probably about six weeks to do. Wow. Wow. And you talked about a lot of things. You know, I'm just going to list a couple of them. We're going to dive into hopefully at least two.

[00:08:51] Emerging programming, GLP-1, longevity and health, authentic experiences, which I really, I was telling you, really, I like those two words together for what we're doing. Yes. Human capital struggles, digital fitness, finance and M&A, artificial intelligence myths and realities. Yes. Personalization, self-service solutions, cost of hesitations, impatience, economy, and then marketing, creative CAC.

[00:09:15] You know, as we are isolating a couple of things, you had mentioned mega transactions and you just talked about it a little bit and why we're set up in 2025 to see more of that due to, you know, maturation, a lot of different factors. So let's start with that, if you don't mind, Brian, like give us some ideas of what would you consider a mega transaction? Why do you think that's happening? Why would you consider us a maturing market? Yeah. Yeah. So there's a lot of things there.

[00:09:41] Of course, when you see maturation, and I would say that aspects of the facility business have reached maturation. And what that maturation represents is a high degree of players that have reached a certain mass. And in order to maximize their performance, they have to weigh the cost of organic growth versus the cost of consolidating or acquiring. And so that's one dynamic, which is just maturation in markets.

[00:10:10] You see like Planet right now. I think they just bought Texas Family Fitness. You know, you see, you know, they're reaching pretty, pretty large scale in the United States. So you look at basic fit out of Europe, all company owned. So these companies on the operator side, you look at Puregem with their acquisition of the bankrupt blank locations. You saw the merger, as we mentioned, any time in Orange Theory. So I think that's just a natural life cycle.

[00:10:38] And so you have that on the one hand, which is an economic dynamic that is just a part of nature. And on the other hand, you have a lot of dry powder on the sidelines in private equity. And you have private equity firms that have made investments that are reaching a maturation point. Typically, private equity likes to get out typically in a five-year window.

[00:11:01] So there's a number of these firms that have seen their private equity partners and owners reach that time. Now, a lot of PE is looking to move these investments into what they term as continuation vehicles to sort of extend that life cycle. But I think that for that and a lot of other reasons, I can see some mega transactions. Now, I don't want to be too specific, you know, because not because I don't want to be held to account.

[00:11:30] But I'm also privy to information that I can't really seem like I'm talking about because I don't want to breach any confidence or trust. But there are a number of players on the operator side globally. They're also the reality of cross-border competition. You know, you saw globalization with Fitness First at one time. They were kind of ahead of their time. On the day, you saw 24-hour go into China and fail miserably.

[00:11:53] So, you know, there have been attempts in the past at realizing cross-border expansion outside of the franchise models, which have done that. But I think there's just a lot of real fertile ground for these transactions to appear. And as well on the supplier side, you know, I think the same dynamics exist because of the same reason.

[00:12:15] Now, you know, with the election in the United States and some of the rhetoric and policy orientations of the incoming president, we also have this tariff conversation. And, you know, that could put a chill. We also have the long bond moving up, which with the Federal Reserve making moves on short-term rates. And even today, the jobs report coming out that shows unexpected job growth in the U.S. So there is a potential for inflationary pressures, which the market is anticipating.

[00:12:43] And this moves long bonds up, which, you know, financing is part of these deals typically. So we could see some chilling on that. But I think where there's a will, there's a way. And financial people can be pretty creative in how they do these things if the underlying economics makes sense. So all that being said, I'm pretty, I'm pretty confident that you're going to see a number of significant transactions.

[00:13:08] I mean, ABC floated or somebody reported that, you know, their group was considering an exit. You know, so you hear a lot of this, you see a lot of this. And I just think for the reasons I just outlined that we should anticipate a number of sizable transactions. Interesting. You know, outside of the financial side of our industry, which is obviously the lifeblood of what we do, where would you say we are as an industry long-term? Like as an industry, how mature are we?

[00:13:37] You know, if I'll use a Pete Moore's analogy, you know, if this is a baseball game, what inning are we in, do you think, for the fitness industry? Yes, I think the first thing is defining what is the fitness industry, because a lot of people will tell. Yeah. And it's very blurry because facilities are, you know, bricks and mortar are one component. And then you look at the fact that Apple's ecosystem has three quarters of a billion people in it. And, you know, I've got my watch on right now.

[00:14:07] They have a billion devices. And then you look at other industries like travel or any transportation, whatever you want to talk about. And you can see the digitization of aspects of those industries is pretty significant. And the same pressures that impact the economics of facilities, you know, across retail, across hotels, across anything, are the same. And, you know, you have challenges of labor costs.

[00:14:32] You have challenges of construction, which is another aspect that's going to drive M&A activity because the cost of building new versus acquiring is now becoming a little more aligned. So, you know, I think in general, obviously, there's a lot of tailwinds on demand for services related to people's health in a number of ways. And our institutions, our traditional institutions with respect to health, have failed us greatly. And so I think there is a tremendous opportunity.

[00:15:01] And I expect and anticipate that growth will be, you know, double digit, you know, maybe in the six to seven percent range globally for the foreseeable future. Now, what those models are that deliver those services, how they are delivered, what that those services really represent. That's the that's the elixir of innovation that we'll see. So when we talk about trends, as you and I were mentioning before the week we went live here, you have to look at a window.

[00:15:31] You can you can see those tailwinds, which are very positive. But when you think about trends, usually in a one year trend cycle, one to two years, you're really talking about optimization. It's unlikely you're going to see something really significant impact those deliveries in the near term. So you're really going to talk more about optimizing. And I think is one of those things. People might optimize self-service. They might optimize certain things.

[00:15:57] But you're not going to see AI robots emerge as a mainstay of delivery in the next 12 to 24 months. Unlikely they will. Then you talk about micro trends, which are a little broader, you know, and those things are more inside the business models themselves and beyond optimization, starting to adopt and new things. And again, some of the early adopters will do this. That represents about 13 percent of the market generally. And then you start moving into more macro.

[00:16:26] And then in the macro, you're dealing with demographics. You're dealing with more significant technological shifts that people choose to start to adopt. You're talking about economics as well, where people are really testing business models and launching new things that are more significant in the breadth of what these trends are really going to provide competitors to adopt to really differentiate their offerings.

[00:16:50] And you start looking at more macro to futurists, which is really more 8 to 10 years, more like a decade. So, you know, you look back, you know, 15 years, 20 years, low price, high volume markets or high volume, low price markets. You know, Planet is really a last decade phenomenon. The same is true generally with BASIC and other competitors who are offering low price with lower labor components. And they've garnered huge market share.

[00:17:18] Now, where that, you know, where that integration of digital, which is significant, you know, as the report cites, there's a high percentage of people in around the world that they use self-care. Their workouts, their everything. That's part of the mainstay of delivery already. Now, where all that goes is the question. And another real quick point on that when it comes to human capital that I mentioned here too is what you're seeing going on in group fitness experiences. I mean, they're in utter decline.

[00:17:48] You know, the number of people coming into the industry to deliver group training has diminished significantly because there's not enough money in it. And people that are younger have too many alternatives. And the economic realities behind work don't make that easy to do anymore. Similarly with personal training. I mean, you similar dynamics.

[00:18:07] So the kind of things older guys like me were used to with respect to what were components of the fitness industry, they're diminishing significantly as a result of these kind of things. So. Hey friends, this is Eric Valzone. And this episode of the future of fitness is brought to you by the podcast collective. Since our inception in 2023, we have emerged as the fitness health and wellness industries premier podcast placement agency.

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[00:19:39] I'm very positive about the long-term. What that really is going to represent is the question. And that's where the fun exists, right? The human capital thing is something I've been concerned about for years. Like I don't see, you know, I started my gym in 08 and it was CrossFit. And you, back in that time and era, there was a lot of passionate people about, people passionate about coaching, the education, right?

[00:20:06] The fundamentals, the love of it, and the, you know, really the art and philosophy of coaching. And I've talked to people who run franchises, growing franchises who offer group training models, you know, specifically like strength training, but even, you know, specific to, you know, more cardio type training. And it's a concern. Like there's just not that passion coming in anymore. And I've felt that personal training or small group training or group training type of people who are wanting to get into that profession. It's kind of fallen into the gig economy in some ways. Yes.

[00:20:36] I mean, is that a trend that you've seen across your network or your insights as well? Oh, yes. I see it. It's also why I think franchising became very popular for a while as well, because some of those passionate people would go and buy a franchise to try to, you know, partner in a way with, you know, with systems to try to help them be more successful. But yeah, I think it, and I think it's largely driven by economics and demographics and, you know, just what it is. I mean, you don't see many haberdasheries anymore in men's clothing.

[00:21:04] You don't see, you know, the idea of travel agents and going to them. And you remember the old days where you'd go get your printed out tickets and you'd have your travel agent person and they would arrange for your travel and all this kind of stuff where it was really nice and very human experience. But the economics just didn't support the dollars anymore.

[00:21:23] And then when you have digital alternatives that are more convenient, and I'm telling you with respect to this, digital alternatives that are more convenient have also eaten into that just because of what it is. So, yeah, I think a combination of those things are really reforming what connotes, you know, the fitness industry and what those service offerings are around it. At the same time, as a report mentions, you know, high rocks is a huge, a huge emerging dynamic.

[00:21:51] You mentioned CrossFit earlier. I think there's still, you know, humans, they want authentic experiences, right? And I think there is, there's still a desire for that quite considerably with the Accenture research that I shared in my report where I think physical activity and outdoor activity is authentic experience. You know, by the consumer surveys, you know, by the consumer surveys, they were, they were touting in that.

[00:22:15] I think it was 40, 50 something or more percent being the main thing that people were looking to do. I think there, you know, when you go on Airbnb, you can buy fitness experiences, you can buy yoga experiences. So it's not like the desire of that is going away. I just think it's reforming itself at new delivery models that are different.

[00:22:38] And at the same time, if you have a really passionate person who's very accomplished, why in the hell would you work in a fitness facility versus doing your own digital fitness and being an entrepreneur? Because you're actually, you have the opportunity to make a hell of a lot more money and be more flexible. Yeah. Yeah. You know, I've heard from a lot of people too, you'll see kind of part-time trainers who want access to the facility so they can film their content. Right.

[00:23:08] And just to, to their social or their influence or whatever you want to call it. That's right. Yeah. And you have like EOS has their wall of, for Instagram and a lot of clubs, as you know, the members are in there doing this. They're not even trainers and they have literally in, I've seen in cycling classes, you probably have as well, let alone on the strength floor where they have the little ring cameras with their phones set up and they're training and filming and streaming right from the club. It's wild. It's pretty wild. Yeah.

[00:23:36] I, you know, maybe I'm a curmudgeon. I don't like it. You know, like I go to the gym, I don't like it. I don't like having filming around me. Yeah. Yeah. I could see that, you know, maybe if I was 25 again, I wouldn't mind, but. Yeah. Let's, let's dive, expand a little bit more on the authentic experiences. You labeled it in, in the presentation of, you know, anti-bad tech. A lot of really interesting data and information insights in here. So yeah. Tell us about authentic experiences. Because I, I mean, when I read that, I was like, ah, I've been trying to explain that.

[00:24:06] But you put two words together that kind of finally helped me describe what I think the future of, at least in the short term of our world. I mean, you look at other ships and, you know, all these unique experiences are coming around. And I was talking to an app developer yesterday. It has a very good app. I can't say who it is. But, you know, I'm like, this is younger generations want journeys. They want experiences. They want, this is what they value. Right. And I think this is something that's, that's really powerful that we should highlight. So yeah. Give us, give us insights on where that came from.

[00:24:36] Yeah. It's a, well, it's from the Accenture survey and their trend report of last year. And it's referenced in the presentation material. So, you know, it's a, it's kind of a broad term. People have used authentic a long time, but, you know, and experiences, they can use it a long time. I think part of what meta, meta, meta, meta-criti, mediocrity is there. They have a certain term that they call it mediocrity. Yeah.

[00:25:01] But I think apps are a great example of this where, I mean, look, have you gotten the new iPhone with the AI built in? Okay. That's okay. It's terrible. It's terrible. I turned it off. Oh yeah. Siri has been horrible for years. I mean, I, you know, I tried to call my wife the other day with the new AI thing on and it's like, who's that? I mean, I've been using Siri call Marine for years and doesn't even.

[00:25:29] So part of this is, and relative to the apps, when, you know, some of the app providers in the industry, a lot of adoption rates for utilization of apps are mainstream. They're under 5% when it comes to facilities utilizing applications, which for a lot of people it goes, what? And what you, what you see is a lot of these apps, they're terrible. Their user experience is terrible. It's, it's not, you know, convenient.

[00:25:57] It's, it's not very well thought out. A lot of folks would just get an app to say they had an app. And when you look at the other trends we talked about here, the impatience economy, for example, you know, in the impatience and the cost of hesitation, which are big trends. In today's world, people want to have their needs taken care of like immediately. They need, and they need to have trust around that. And you can build that trust, but you got to do it in a way.

[00:26:26] It's very fluid and it anticipates and it's simple and it, it, it does well. And they, they feel, you know, gratified about it. When you, when you look at Domino's Pizza and what made their stock do very well is they're one of the early adopters of their mobile app, which gave people a map that showed how close the pizza was. It's very easy to transact, right? That's what people are accustomed to.

[00:26:50] So one aspect of authentic experience is, and we call it anti-tech in this thing is that a lot of people are, their tech has failed them. It's not well done and they get frustrated. And many people, in fact, in the Accenture report, I think it's one out of six are opting out of smartphones and going to simpler devices because the juice isn't worth the squeeze. It's wow. It's becoming a barrier almost.

[00:27:17] And I think a lot of firms, what happened was they thought, well, we got to do tech. So let's just put this in there. Or they had legacy technologies. And so they were like, well, we can't spend that much. So let's just do this for now. And it's terrible, right? So that's one aspect of, of, I think the authentic experience piece.

[00:27:38] The other aspect that Accenture's report addresses is what I alluded to before, which is, you know, people are looking for these experiences. I think the report sites, as I mentioned earlier, 48% want authentic fitness experiences. Another 48% or more or so want, you know, social engagement and outdoor experiences. They want real human things. And they want those things that are kind of non-digital.

[00:28:08] And I think that's a real thing. And I think it's a backlash to bad tech, you know? So, and people's desire to want to, you know, be human. So. And it's just, uh, not just bad tech, but the sheer volume. Yes. You know, a lot like speak for myself personally. I'm in front of a computer in my house most of the day. Uh, you know, when I'm done, like I do, I want to get out. I want to do, I want to socialize in a real way. I want to play a sport with somebody.

[00:28:37] I want to, you know, have a beer with friends, whatever it may be. Like it doesn't have to be fitness for me, but you know, I, I, I need that. I crave that. And I think it's something that, you know, I was talking to me at Kyrkos about from, you know, on a wellness side perspective on the global trends there is like, it still all comes back to community, human interactions, experiences. Like, I think that's still at the core of what we do and has been for a very long time. And that's, uh, you know, trends come and go. We talk about these things, these, these hype cycles, right.

[00:29:05] But I haven't seen a reason to ever believe that community driven, authentic human experiences are going anywhere. They seem to be the cornerstone of what we do because, and this is what I want to get your thoughts on. It's tribal. It's innate. It's in us as humans, right? That's part of our DNA versus a lot of stuff that we kind of push down people's throats in the fitness and wealthiness is not like we crave convenience. We take the path of least resistance. That's just who we are. And sometimes fitness is hard work.

[00:29:35] So we have to push it and we have to try for it. Right. But these other pieces are not there. It's, it's, it's grooved in us already. Yes. A lot to say about that. So you're right. And if you look at, well, at the digital fitness aspect of the report, I pull out some examples from the Europe active Deloitte study earlier last year, where they talk about the consumer survey of European fitness consumers.

[00:29:59] And there's still huge gaps in what people want from technology that they're not getting. So I think, I think it can be both of those things. I also think generally in society, there's also the reptilian mind meets the Kardashian lifestyle dynamic. Where, you know, you know, our reptilian minds are about, you know, waiting for the tiger to come out the bush. You know, if you see a tree with fruit on it, you know, you want to eat as much as possible

[00:30:29] because you're not going to get that, that off. So you have these innate, you know, aspects of our humanity that make us do want to do things we maybe shouldn't do or whatever. And then you have, I'd say the Kardashian lifestyle of people looking for things for social acceptance, consumption, these other dynamics and these forces. So I think you can have two things going on at one time of the dopamine of immediate gratification

[00:30:58] versus the knowing in your head that you need to, you know, take care of yourself and train to your point and push. So I think these things conflate. And I don't, I think it's not just the fitness industry that this is going around with people in general. And the other thing to keep in mind is, you know, technologies create problems that new technologies will emerge to solve those problems that will create another set of problems that will be solved by another set of tech.

[00:31:26] So it's part of a cycle that's necessary because we can't just go from zero to a hundred. You know, we, we have to kind of figure it out and you combine that with the risk reward dynamics of certain businesses, you know, you know, early adopters, as I said before, are a very small percentage of the industry. So these things had been kind of created by us and now it's up to us to solve them. Yeah. Which dovetails really nicely through Kardashians and then emerging technologies of GOP ones,

[00:31:53] because, you know, GOP ones, I think the thing that irks most people is that, you know, we let our food companies get us in a real hole, right? And now we're letting the pharma companies bail us out and they're all making a boatload of money off of it. Yeah. Kardashians have their own GOP one product. You know, when I started out this point last year, I was very optimistic about GOP ones for our, for, for our industry, right? Like, okay, you know, this may drive the other 80% that we've been talking about for eons now, right?

[00:32:22] Which I'm kind of tired of that conversation, but maybe this is going to drive people into the gym. People who are going to start losing weight, they're going to want to feel better. They're going to want to do the right thing, start getting some, some, some training and some strength training, eat more protein. But a year's gone by and people are losing weight. My concern is, is that actually driving people into the gyms or are they just happy with that and they're going to stick to the easy button? And they're not going to go over here just because, you know, maybe a small percentage.

[00:32:52] And I was thinking about like Susie, the soccer player, maybe it was an athlete when she was younger, but somehow something happened. She gained a bunch of weight, had a couple of kids or something happened to stay in an injury. And now they're starting to lose weight. And now they're so excited. Like, oh, I can get back to being an athlete again. Now that's rare for the most of the people. They never knew exercise, right? They never knew routines. They never knew good nutrition, but now they're getting bailed out because of this medication, not necessarily healthy.

[00:33:19] But do you think now after a year of real, you know, kind of good conversations and insights and I'm sure you've had this conversation, is GLP-1 moving the needle for our industry, you know, as far as the health clubs and the gyms and the trainers, is it pushing people in there or is it not doing what we hope to do? Well, the last report's a good question. I don't think it is yet. I think it's got, there's some time to come for a lot of reasons. And it's not just about, as you know, the GLP-1 agonist.

[00:33:45] It's also about a plethora that I share in the slide deck of other technologies that are being developed. And, you know, we're just scratching the surface of what is ultimately going to arrive. I mean, you're familiar with peptides and other things that are actively being researched. And as you also probably well know, you know, I've had a few friends that had, you know, significant others that got very ill using GLP-1s. You know, it's not a main thing, but it happens.

[00:34:13] The other thing, as you know, is I think 12% of U.S. adults have used them at one time or another. And actively, I think about 6% in the United States have used it. There's also the reality that if you're still involving yourself with needles, you're dealing with economic and prices. The pill is coming and it's going to be out in the marketplace probably within 12 to 24 months. That is going to be a GLP-4 dynamic, which has other functionality.

[00:34:41] I think this is very early days. You know, one would imagine with that reptilian mind meets the Kardashian lifestyle that when they get the drugs better and right, it's going to probably be easier and easier. And, you know, we're not certain about this, Eric, but I would imagine that given those things, that adoption will go higher and that that will lead to a greater impact to the industry in adoption.

[00:35:09] And I mentioned, as you know, the various longevity programming that Equinox or Lifetime and other operators are experimenting with. I don't think those have gone as well as, you know, we're in early days, right? Like a lot of these things. But when we talk about innovation and we talked earlier about that optimization versus macro versus futurist, I can see this becoming a mainstay of delivery at some point.

[00:35:38] And so we're just, I think, in the early days for a lot of reasons. I don't want to come across negative as I do. So I was on another podcast yesterday. She's like, you sound frustrated. I'm like, yeah, maybe it's just the time of year. But do you think we're ever going to really make an impactful dent into the other 80% as an industry? Like what does your gut tell you? So again, we have to define what industry we're talking about when we say we, you know, and I'm not negative either.

[00:36:07] I think, and I don't think you're negative, Eric. People have told me I'm negative. I'm just more of a realist. Maybe that comes with age. But, you know, things never happen as fast as we'd like them to. And sometimes they happen faster than we care to have them. You don't get to always pick. But, you know, if you're talking about, in general, the bricks and mortar, low price dynamic kind of fundamentally, and no offense to anyone, but those businesses aren't in the business of getting people healthy.

[00:36:36] You know, they're in the business of providing workout equipment at a cheap price. And if you have a tide of people seeking to fulfill those needs in that way, that's going to be more driven by intrinsic reasons by those individuals, you know, and they'll use the equipment. That's one thing. You talk about the Blue Zones concept that's constructed in Miami and being opening soon,

[00:37:03] or other new models, like the ones I mentioned before with Equinox and Lifetime, and more to come. And there are many others. Eric Casabury's doing one with, you know, there are a number of different ones of these. Yeah, I think those models, you know, have the potential or variations on those to really address the 80%, and sometimes with therapies that are going to be helpful in that regard. But we also have to realize we're in a food industrial complex in the United States and

[00:37:31] in a very broken sick care system. And so at some point, you know, these institutions have failed us. They've failed us. 100%. 100%. Yeah, it comes down to individual choices. And I get that. But we're also inside a techno feudalism dynamic right now. That is, we're going to have to move out of it eventually, you know, and I would encourage people to read Giannis's book on techno feudalism and what that means.

[00:38:00] But these are all steps that are part of a process that is not, you're not going to just flip a light switch and have all this happen overnight. Because there's so many incumbent players, and there's so many habits and things that have to change in order for it to become widely adopted. It's not that easy. It's a combination of aspects of dynamics that they're underway. And it's just a question of the timeframe and the innovators that figure out how to tap into it.

[00:38:29] But also, we need policy change. And that could help as well. Well, that's something that, you know, I've talked about numerous times, I just feel like we're undergoing whether, you know, there's a conscious or subconscious rebrand of the industry, you know, from what it used to be back in the day of the 24 hour fitness in the eighties of like sweat and fat loss and all that. To now we're like, we're maybe we have a legitimate shot at being at the forefront of health, right? Like, cause that conversation seems to be happening.

[00:38:57] And a lot of it's driven by consumers demand for more, you know, for better health and wellness, which is great. So do you think that's true? Like, do you think that's is that actually happening? Or is that something I'm imagining? I think it's happening a little bit. But for the reasons I just cited, I think there's more underneath it that has to go and will that that is outside of the direct control of the classic kind of fitness industry, putting

[00:39:25] aside the other models that are emerging and the drugs and the and people having digital access to health and and what is going to emerge eventually with other technologies that will help support that. I just don't think it's going to be an overnight thing. And then again, I think that we're inside of a bubble. Many people are. That is makes it very challenging in today's world to escape it. You know, again, that's no excuse. You know, I mean, people get to make choices.

[00:39:54] But the more our institutions continue to fail us and the more we get these incumbents unseated with respect to the obstructions they engage in regarding people's health, that's not going to hurt things. That's going to make it easier, too. So I'm very optimistic for the tailwinds that we described earlier. I think they're very real for a lot of reasons. I've been talking about it for a long time. But I just don't think it's all on us. I think it's the soup of a number of dynamics that are going to come together and deliver that.

[00:40:24] And two is legislative. And you and I talked about a year ago about the potential of us entering into the health insurance world. I also feel like with this year's elections and we don't have to get into politics, but I do feel like there's an opportunity that we may have the political will to make some changes into our health care system. So how do you feel like our integration into the health care system is looking? Is it still are you still cold? I'm very negative about it. I think it's a I think it's a crock of baloney.

[00:40:54] I mean, I and the reason you say just pull out United Health Care's 10K filings. I mean, read with the business there. And I mean, health insurance is an unnecessary evil in the United States health care system. I mean, it's a it's a broken, nonsensical, irrelevant dynamic. And all this has to do is is money. And health insurance companies are not in the business of getting people healthy.

[00:41:19] They're in the business of making money by being a go between between suppliers of service and consumers of service. And there is no benefit in getting people healthy. None, because a lot of these behaviors take years to pay off. And they just want that to go into Medicare and be the government's problem. And now on top of it, as you know, with these Medicare systems with United Health, where they convince people to go in Medicare with their managed care aspects of Medicare, they are actively

[00:41:48] juicing up people's sickness score to get more reimbursement. And they're not doing it, which seems counterintuitive, right? Why would you be juicing up the score on people's illness instead of doing something about reducing their illness? But why? Because the system compensates them more money when the people are ill, more ill. So this is the kind of nonsensical dynamics. But when you look at United Health, you look at the fewer players, it's oligopoly, you know,

[00:42:18] or maybe monopolistic in the sense that these people just print money. And it's going to take a lot to convince people there's a better option because of money. There's so much money in it. And so I am not an optimist about it. I think people, but what I am an optimist about is people realizing more and more that that is not the solution for their health. That I think is more of a thing. They're going to have to opt out and, you know, and we're going to have to find another way because it's just simply not sustainable.

[00:42:46] But the current institutions and players are not the answer. You know, they have no incentive to be the answer. It's I'm starting to see very solid sparks of change there at a very small level. Right. Like, you know, I think people are tired. I mean, I just went through my enrollment period with my wife for our insurance and I was like, this is fucking worthless. Yes. All it does is cost me more money. We pay this and then I go in and I, you know, once in a while I go to the doctor and I pay

[00:43:14] more and then I have this huge deductible and like, I just end up paying cash. Like, what are we doing here? Yeah. And, you know, starting to see things like, you know, it's in a small frame in a small community of the CrossFit Medical Society developing their model. Right. So you can opt into it. There's a, you know, obviously concierge medicine like here locally where I live in a very small town. You know, there's one doctor who four of my friends, five of my friends already referred me to, you know, she's a hundred bucks a month and it's concierge and it's great service. And she works alongside insurance.

[00:43:42] So I think I'm starting to see little sparks of that change. I mean, what do you, I have a little bit of optimism. That's what I'm trying to say. Well, I think those things are true. I have a, I have a concierge doctor and, you know, cause you learn that if you're going to actually take care of yourself, the main system doesn't work. And I agree. I think that's the opting out example. Fortunately, you know, we're, we're, we're privileged in the fact that we can do that. And the vast, when you talk about the 80%, a lot of it is economics. I mean, you know, people don't have the money and that's why they're in the system because

[00:44:12] they don't really have other choice. The other thing is, I think we talked about before is these marketing ploys where you'll see Blue Cross say, oh, we bought all of our people, Apple watches to help them. All of that is lipstick on a pig. It has nothing to do. It's in what you see in oligopolistic competition is these kinds of dynamics where it's lipstick on a pig. It's, it's just making people feel better about the trap they're in and get out. It's not necessarily changing the trap.

[00:44:41] So, but look, what comes down to is this is if business models can figure out ways to help people feel better and, and be healthier and, and benefit from that in a way that the economics are affordable. Yeah. They'll completely turn the existing players upside down on their heads. And you see what Mark Cuban's trying to do with pharma, pharma right now. You see, so yeah, there are sparks and they're always going to be sparks.

[00:45:12] How that gets mainstream. That's what we're going to need a little time to, to figure out. It's a huge battle. And you're right. And I think that's something that when we talk about the other 80% that doesn't get focused on enough, it's very socioeconomic. Yes. Like it's, it almost wholeheartedly. That's the driving factor of why some people can't get healthy. And a lot of people can't get healthy four out of five, right? Have a really hard time doing it. So, you know, I think that's something that maybe we talk about in our industry. Not enough. I would say. Yeah.

[00:45:41] It's a, it's a real dynamic. And as you know, with the stats in the industry space in general, our customers in the traditional fitness model, they ask you to higher disposable incomes. And, you know, thankfully the low price models are there, but it's not just about, you know, the price of the membership. It's transportation to get there. It's convenient. It's all these other things. And, you know, in that world for a lot of folks, which is a real underlying economic dynamics on income, which you see affecting also the human capital side, as we mentioned

[00:46:11] earlier, these people are working, many of them, two jobs. They don't have time there. It's very easy for us to say, well, get up at four in the morning and work out for an hour. I mean, I mean, it's, you know, and some people do that and kudos for them, but that's, that's asking a lot, especially if you have children, you're dealing with the cost of daycare. I mean, it's, it's, you know, you really have to be a formidable human being to be that disciplined with all those obstacles to overcome. So I have a lot of empathy for folks, but I'm also very positive in the long run.

[00:46:40] I think it's, I don't know how many years we talked about a five year, we talked futures eight to 10, but look, it's got to, these things have to happen in some fashion or form because if they don't, it's, if this is completely unsustainable. Yeah. Yeah. Well, Brian, I know you got to get onto CEOing. You know, last question I have for you in the last minute is like, where are you going to be this year? Any events that you plan on attending? I know you get out a lot. So where can we expect to see you? Yeah.

[00:47:08] I'll be at, you're a pack of event. I'll be at, and FIBO, I'll be at the health and fitness associations event in Las Vegas. I'll be keynoting at a sideback event in May in Orlando and then traveling all over the world in the coming months, just shaking hands and saying hi and listening and learning. And Eric, thanks for doing what you do with your podcast. I enjoy listening and enjoy your interviews and appreciate all that you're doing. Where are you going to be this year? You know, I don't know yet.

[00:47:36] I just booked a connected health and fitness. So I'm going to start there. Yeah. Good. Cool. Yeah. Cool. Right on. Okay. Well, listen, I enjoyed the chat. Thanks for making time, my friend. Always a pleasure. Ladies and gentlemen, Brian O'Rourke. Take care, Eric. Hey, wait, don't leave yet. This is your host, Eric Malzone. And I hope you enjoyed this episode of Future of Fitness. If you did, I'm going to ask you to do three simple things. It takes under five minutes and it goes such a long way. We really appreciate it.

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