Lou DeFrancisco - StretchLab & Xponential's XPass

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If you're interested in the fitness technology game and looking to accelerate your growth, I highly suggest you check out fittechsummit.com forward slash club to learn more. You can join the highly valuable newsletter, apply for the FitTech Club itself, or simply learn more or connect with people like me. That's fittechsummit.com forward slash club. All right, we are live. Lou DiFrancisco. Welcome to the future of fitness. Thanks, Eric. Glad to be here. I'm excited to have you. We had a great little conversation. I mean, I I'm very interested in learning about Stretch Lab, uh, X Pass. Uh but one of the things that we were just talking about was the positive signs that you're seeing within Exponential and Stretch Lab of you know the the demand on the business coming out of, and you know, I don't normally do it, but today's recording is January 18th of 2022. Um you and I are both recovering from COVID, as is probably just about everybody I know. And uh, you know, that a lot of gyms go back into closing down, um, at least for a short period of time. Schools, you know, same thing are center the kids home for a period of time. But all in all, I feel like there is a underlying sense of positivity even through this point that hey, we've kind of made it through the last year or two, and we know how to deal with this now. But all the signs are looking to um something, you know, it's equates to a very bright future. So we'll get into that. But I let's start with this, Lou. As always, if you don't mind just giving us a little bit of your background, how'd you get to be present in a stretch lab?

Sure. Love to uh been in uh health and fitness world for almost 18 years now. Uh so really um the the story I love telling it just like how a lot of people get into health and fitness, someone drags them in. You know, I had a good friend of mine that was a physical therapist, personal trainer, he owned a health club, and he knew I wasn't happy in the industry I was in, and I was looking for other jobs, and and it took a couple months, but you know, after a couple of coffees or lunches, and he he talked me into coming to work for him. And it was a really unique experience for me because it wasn't your classic big box health club where I would just, you know, I went in as a journal manager and started selling memberships. It was a um unique um business, health, fitness, wellness place that really didn't have a place in the industry yet. But what what he did as a physical therapist and personal trainer, it was all cash pay. And he was just super passionate about helping others and making a difference in people's lives. And he and he hired people around him, other clinicians and personal trainers that had that same vision. And it was a about a 10,000 square foot box, and it was um, you know, 90, 95% of our revenue was derived from one-on-one services, physical therapy and personal training. I I ended up working there for almost five years because I just fell in love with this world of health and fitness. And what we ultimately came to describe this place as was a holistic approach to treatment and training. And we brought on um chiropractors, acupuncturists, massage therapists, in addition to the physical therapists we had, and ultimately built up a team of 15 personal trainers. And it was a really cool experience. And, you know, I there's there's a lot of personal training studios out there now. There's a lot of wellness centers out there now that are doing something similar. TB12 has made it really popular with his pliability training and having someone do some manual therapy on you and then teach you how to move your body properly through space so that you don't re-injure your body again. And that's essentially what we did. And the cool part for me, because I'm a learner by nature, I love learning new things. So I got to come in and learn this, you know, physical therapy and personal training world and how, and and from a business side, how to sell that. And you know, there wasn't, and this was mid-2000s, so this was before monthly memberships were a thing, and it was just all either one-on-one services or some some kind of packages, and then just getting to learn the ins and outs of the different modalities that are out there: physical therapy, uh, chiropractic, acupuncture, massage, and how they all interacted with each other. They didn't necessarily compete with each other, they were all different in their own way. And we we were able to help people by pointing them to, hey, we have all this under one roof. You should see this person and then see this person. Um so it was it was pretty awesome, unique experience, and I think really set me up for success when I came to Stretch Lab. And and in between there, that was, I call that my entrepreneurial experience because it was only ever one location. The owner was just your classic entrepreneur, always trying to do new things and change things up. And let's try this and let's try that. And what I learned through that experience is that I am as an operator, as the general manager, I'm an operations guy, I'm a systems guy. So we worked well for a long time because he'd he'd say, Hey, let's try to do this, this thing. And then I'd be like, Okay, if we do this, this, and this, all right, then it kind of makes sense. Let's, and I'll try to put it in a box. Um, eventually I m moved on because I wanted to keep growing my skill set, and I knew he wasn't ever gonna operate more than one location. And I mean, the cool story is that it's still in operation today. So, where is it? It it's in Wellesley, Massachusetts. Um that's where I spent most of my adult life before I came to Stretch Lab um in the Boston area. So um, I went to work for a boutique fitness franchise after that, and I knew nothing about franchising, but I knew I wanted to stay in the world of fitness because I loved it. I found something I was passionate about. And um the the franchising piece really intrigued me because I knew zero about franchising, and and this was 09. So I was um entered this world of uh franchising primarily because I knew a lot about fitness and running a studio and how to sell one-on-one services. And so that translated well. I went to work in the corporate office for this franchise system, and it was small group personal training. And I went around to they had about 30 locations in and around Massachusetts at the time. I ended up working there for eight plus years, and um the last five and a half years or so, I was the president of that brand. We helped to grow at over a hundred locations nationwide. And that was an awesome experience too. I got to, I, I, I got to realize the value of franchising and the value that systems play in helping to grow a brand and really helping people realize that American dream of owning their own business, but not be in business completely by themselves. You've got your franchise or there to provide the support and the training and the coaching. And I love that. And so I found what I love about this, I had my entrepreneurial experience, and then I had my franchise experience. And through those experiences over, you know, almost 15 years, I really got to see what I was passionate about. I was passionate about health, fitness, wellness, and passionate about helping others be successful in running a small business. And franchising gave me that avenue to pursue both. And um, exponential fitness, um, Anthony Geisler is the CEO and founder of Exponential Fitness. We had known each other being in the industry, fitness and franchising, and he um called me up and um was like, Hey, I'm gonna do this thing. Um, gonna create a business and and try to um go buy some um concepts, some fitness concepts, and then franchise them. And we stayed in touch over a couple months, and you know, a couple months down the road, he was like, Hey, so I did that thing, I created exponential fitness, and I bought this brand called Stretch Lab, and I want you to come run it. So, you know, I think it was just meant to be. I think my background and experiences really prepped me for that opportunity to, you know, my I didn't think about it. The answer was yes, you know, and Anthony calls and says, Hey, I got this opportunity for you. You say yes, because he's known for building big brands. And he was successful with Club Pilates, and there was this opportunity to be a part of something special and unique, and I didn't fully grasp the the scope of it. Um, but that was um end of 2017, December 2017. So I just celebrated my four-year anniversary with being with Exponential Fitness and Stretch Lab. I was brought in as the president uh and I hired the team. We put the franchise documents together. So we bought this brand. Um, we bought the rights to the name and the rights to franchise this brand. It was started in LA with three locations. And you know there there were there were actually multiple stretching concepts that Anthony looked at and considered buying. And one of the unique things that he loved about Stretch Lab, because it's our only, I'll call it a wellness concept in the exponential fitness family right now. All the others are our fitness uses or fitness modalities. Um he loved the boutique fitness feel of Stretch Lab. What I mean by that is it's an open communal feel. There's no walls, there's no private treatment rooms, it's it's a bunch of benches in an open room. There's a there's music playing, there's a certain energy when you walk into it, similar to a boutique fitness studio when you go into a boutique fitness studio. Um, so four years ago, uh started this journey. Um, a lot has happened in that time. Um, and it's been fantastic. It's absolutely been the most fun I've ever had in any role, in any job. And I, you know, pinch myself every morning when I'd wake up because it's just an awesome opportunity. Um we've had um, I mean, four years, including COVID. Um, and you know, when we look back on it, um, I think I can speak for all the other presidents at Exponential. Yeah, there were there were a lot of blessings through COVID, despite the all of what COVID brought, there were also a lot of blessings um in disguise. And and Stretch Lob was definitely one of the brands that benefited from making some tweaks and changes to the model and then having a really strong recovery and um having a bunch of franchise partners that believed in the brand that you know reinvested and um opened up more locations. We've um you know since uh crushed our pre-COVID numbers and um are doing really well. We opened 49 locations last year in 2021. That brought us up to a hundred and over 150 locations now today that are open. Um, so that's pretty awesome despite COVID, you know, in a in a four-year window of taking a uh a franchise brand basically from scratch. 150 locations. We've sold over 500 territories now, which is really impressive. And and that I there's no way my team and I could have done that without the the help of Exponential Fitness, the the money that they've invested in the brand, and um and I I think also a lot of times I just tell people it's just the right brand at the right time. You know, there's a lot of a lot of crazy things that happen to people during COVID and um providing a one-on-one personal service. There's there's something about that that you know when you um for anyone that's been in the the one-on-one services world, you'll know what I mean by this. When you place your hands on someone and and make a difference in their body and make their body feel better, there there's something magic about that. And that could be physical therapy, personal training, chiropractic, acupuncture, massage. And now we're adding to this mix stretching. And and I I think that's a big reason why we see our lead flow is is through the roof that coming in at the end of last year through the beginning of this year, and we we see um and and are really bullish about this this coming year for in general health, fitness, wellness.

Yeah, man, I I am too. And I'm I'm curious because you know, I've had a few presidents of exponential brands on here. Um you know, Garrett being one of them, and uh a few others. So it's it's been uh it's been interesting to learn about it. But you know, when you look at Exponential as a an overall company and the acquisition of brands and the growth and really becoming like the leader in in boutique fitness in so many different ways, what what do you attribute that success to? Is is it is it the leadership? Is it uh Anthony? Is it the war chest of of the funds available to to buy these brands? Is it you know the structure? Like we're I'm sure it's a little bit of all of it, but when you look at it from the inside out, what where do you attribute that success?

Yeah, great question. Um You know, one of the things I talk and try to teach my franchise partners about, especially brand new franchise partners that have never operated and owned a business before, I tell them the number one key to your success is the culture you create inside your studio. And culture starts with you as the leader. You're the owner of the business, you're the leader. It's not just hiring someone, it's hiring the right person, but then in including them and incorporating them in the culture that you create. And and in stretch, uh, I'm sorry, in exponential fitness world, we talk a lot about we are a marketing and sales machine disguised as a fill in the blank for whatever brand you're running or operating. We are a marketing and sales machine disguised as a stretch lab. Um, and and I would say the same thing, I would answer your question the same way. It's it's culture, and culture starts with the leader, and that's Anthony. And Anthony has had the original vision and has put the pieces in place to allow the team now um to continue to drive at a really high level and perform at a high level. Um, because it like what I know at at this stage, and and even in my other brands that were you know smaller than stretch lab or way smaller than exponential, it's never one person. One person has to be the leader and has to set the tone, and that creates the culture. And then if you have the right people that embrace that culture, it's a it's a snowball effect. And that snowball effect just you You know, you keep rolling that down the hill. It gets bigger and bigger and bigger. And the more people that you bring in and they believe the same general beliefs and they and they have the same general vision. You know, we are a marketing and sales machine disguised as whatever brand it is, one of the new brands, now Rumble or BFT, like that is um why we are going to be successful because we can we figured out the pieces of the puzzle that make franchising successful. And that's truly is like marketing. You have to be really good at driving leads into a studio. And then sales. You need to be really good at converting those leads into members. And then the third piece of that is the actual customer uh experience or client experience, member experience, whatever you want to call it. What happens inside those four walls? And that's that's the secret sauce of any franchise business, any boutique fitness business, marketing drive leads, sales convert those leads, and the members drive a great member experience. So you keep those members as long as possible. And that's what Exponential Fitness has uh Anthony had figured that out a while ago. That's why he had the confidence to be able to do this. He's put some uh a strong executive team in place at the exponential fitness level and has put um really strong leaders in place in each one of the brands. And now that's like my responsibility, for example, at Stretch Lab as the president. I have to make sure I bring in strong people that are focused on stretch lab and and making stretch lab the best marketing sales and customer experience stretching brand in the country, in the world. And and that's what what we're what we come in and um work on doing and accomplishing every single day.

Right on. Yeah, it's you know, when you look at the boutique world, um marketing and sales is often something that people will just kind of bury their head on. You know, it's it's uh not why they got into it. Maybe they're great coaches or trainers or they love the you know the group environment, they they're really focused on that great client experience and the whole, well, if you build it and give people a great experience, they'll just show up. Well, it doesn't really work that way. Um it does in short bursts, but it's not enough to sustain a business. And uh it's it's really the marketing and sales, and that and that's it's so critical. I tell people all the time if I'm working with business owners, I'm like, look around your team. If you can't, if you can't easily identify the salesperson, then you are the salesperson. So you better learn how to sell.

And there's this little thing called attrition that you never, it never leaves you. It's never zero percent, and and it's never gonna go away. So that's how I again how I coach uh my new franchise partners that have never operated businesses before, especially boutique fitness or any kind of monthly recurring revenue model, you will always have attrition. So you net can never stop spending money on marketing.

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Like they're like, hey, that was awesome, but I lost my job and you know, I can't, I can't afford this anymore. They could have the best reason possible, but there people will leave. And you always have to be replacing them. So you want your business to be going up and to the right. Um, you can't do that unless you continue to market and advertise and you continue to sell. Um, and it's you know, it's one of the most popular places for new business owners to look to save expenses on is to cut marketing dollars. And I I say this too in all our franchise training to all of our brand new owners. Like, I know now you're you're gonna tell me to my face and mean it, like I'll never spend, I'll never stop spending money on marketing and advertising. But there will be a point in your career that you're gonna think about it. And I want you to think back to this time and say, oh, I remember Lou said I shouldn't do this. Like maybe maybe I should give this a second thought. You're it it's it's just this is the cycle. And it and if you don't like this cycle of business, then you shouldn't get into the boutique being an owner of a boutique fitness business because this is what you deal with every single day. Marketing, sales, customer experience, marketing sales, customer experience. And it just goes round and round. Yeah, just all day long.

Yeah, it's uh, you know, I look back, sometimes I've been asked kind of feels like a lifetime ago, but you know, as a boutique gym owner and operator, what one of my biggest mistakes was. And it was when uh we grew and we hit capacity, and I started a wait list and I stopped my marketing efforts because it didn't last. You know, all of a sudden just this way of attrition came and uh and it was like, well, now my funnel's dead. I never I haven't been doing anything, so you got to kick it back up again. That takes like a month or two to kind of get everything moving again. And starting a wait list I thought would be like, you know, some psychological trick where people are like, oh my god, you guys wait list. No, what happened? People was like, they would come in, like there's wait list, cool. I'll go two doors down. And uh and that that's in Santa Barbara, California, where you can, you know, could sit on my roof with a pitching wedge and hit any direction and hit another gym, you know. Um, so that was I I I guess what I'm saying is I agree with you. I think the marketing and advertising has to be a consistent, consistent lifelong effort as far as the business is open. Uh Lou, one of the questions I want to ask you as you see all you're selling these new licenses and franchisees, um, who's buying them? Like what what type of people? Is it uh, you know, corporate refugees? Is it you know other business owners? Is it investor groups, a little bit of everything? What are you seeing?

Yeah, a lot of our lead flow and and new franchise partners come from the executive world. Um, so corporate refugees, you know, we have this, you know, we're in this time of what they're calling the great resignation. Um I I would I think uh we're we're getting lead flow from that. You know, it appears that way because um a lot of the people that are coming into our world are either have some executive type jobs or they are in the process of leaving for one reason or another. Um, whether they've been successful or whatever, but they've got a chunk of money and they're not, it's not, hey, I'm done working money. It's hey, I want to take this and invest this in something that I've always dreamed of doing. And that's that's the the typical um franchise partner that that we find that we're awarding a territory to. So we have a pretty rigorous uh awarding process. We don't we're like, I don't consider myself a salesperson when it comes to um selling selling a franchise. I'm trying to find the right fit. And and this is what I tell all of the franchise prospects that are interested in stretch lab. This is a two-way street. We want to make sure that you are passionate about this, that you can come in and follow systems because franchising is all about systems, and that you can be a good leader of your own organization because I can't run your business for you. That's not what franchising is. You have to be the leader, you have to be the one making the hiring decisions, setting goals, driving your team's success. Um, and that's what we're looking for as we evaluate candidates. And, you know, so far I think we've we've done an exponential fitness overall does a really good job of vetting people. There's a couple of different criteria that they need to meet. Obviously, there's financial criteria, um, but they we have a system um that they go through three, four, five one-on-one phone calls with someone on our team to make sure they're following the steps and following the systems and and and doing what they need to do. And then they come to what we call a confirmation day where we get to meet them, my team gets to meet them. Um, and and it's a it's been really good for us. And um, so far, I mean, it I think the interesting part about Stretch Lab is that we're we're unique in that it's it's not just one type of franchise partner that that we're bringing in. All ages, all backgrounds, similar to our how we approach uh our studios and the lead flow and the customers we get inside these studios, it's any age, eight to eight eight, any type of person, different sport interests or non-sport interests, it doesn't matter. And and all of our franchise partners have found some connection with stretch lab in some way, shape, or form. That you know, they all come in with some kind of story about, you know, something um related to stretching and how it helped them and helped their body. And um, so it's it's been a really cool experience because I I truly feel like we're finding great partners out there that are really excited about bringing stretch lab into their communities. And and it's uh so most of the time it's it's somewhat in the that executive level, though. Every once in a while we get a couple people that are in the industry, but mostly non-fitness industry folks that are coming in and realizing like we have enough stretch labs around the country that they can go out and get an experience inside of a stretch lab. And you know, whether they've gone once, whether they're a member, we're getting more franchise partners coming in that are members somewhere across the country in a stretch lab. And they're like, Yeah, it changed my life. I love it. I can't imagine not going to my stretch once a week or twice a week. And I want to be able to bring that to people in my community. Uh, so it's it's a it's been a pretty pretty special experience and um looking forward to continuing to grow at yeah, man.

Right on. I I want to uh because I know you're tasked with something else over there as well, which is X Pass, which I find to be really interesting. I mean, it's it's such a uh, you know, you look at the opportunities you guys have at scale when it comes to exponential, it seems like a a very um very intelligent move. And so maybe you could give us a little background, like what is XP X Pass and in connection with exponential and um what is your role with it and what what's the vision of it? Where is it now and where do you think it's gonna go?

Sure. Yeah. So XPass is similar in nature to ClassPass. And I think most people listening to this would understand what ClassPass is. And um Exponential Fitness, the parent company, we now have 10 brands. This idea of creating um a platform to give our members in different brands access to their sister brands in some way, shape, or form, has been on the drawing board for the last couple years. And it's um it's a big technology lift. And so we've um been able to hire a team that is now focused on this idea of um creating um class pass for the exponential fitness family. So it's an internal um only exponential fitness brands. It's a monthly membership, just like a class pass would be. It's a monthly membership, it's credit-based, you know, similar to a lot of these systems now. It's a credit-based system. So you pay a certain amount of month money per month, you get a certain number of credits. And there's an app, obviously, there's an app for it. What isn't there these days? And you can get access to see all classes in every single brand in your whatever the radius is that you set up, and you can use your credits to go in and you can visit um any of our brands. So at one of the stats we shared at, we just had our annual convention in December, um, Exponential Fitness did one of the stats that that we found um that we shared with all of our franchise partners, 53% of boutique fitness users use three or more concepts per month. 53% of boutique fitness users go to three or more different concepts per month.

Interesting.

That's that's crazy. That's a that's a big number. And so we know a lot of membership money. There's a lot of people out there that and internally we call it snacking. There's a lot of people out there that are snacking, they're trying different brands. And so why do we we didn't want to let that just happen outside of our network? We have now over 2,000 studio exponential fitness studios open. Um, that's that's crazy in and of itself. So we have this entire network and all of these members, and so we created XPass, and XPass is is now launched nationwide. Um, so anyone can go and buy an XPass membership. And you can't, you don't have to have a membership to one of our exponential fitness brands. You can just buy an XPASS membership and pay. There's different price points, and it gives you different different um amounts of credits. One of the things that I'm most excited about um, because this happened later, but bringing stretch lab into the XPaaS um fold. Um, because of the one-on-one nature, um, it just took some other technology, heavy lifting on the back end to add stretch lab in there. But stretch lab is now a part of XPass. And so that that's what I'm really excited about because um boutique fitness is boutique fitness, and those users love working out, right? I mean, that's the classic boutique fitness demographic. They're working out multiple times a week, not just once a week. Um, they're using different modalities multiple times a week. And I think stretch lab is going to fit in there really nicely by providing a recovery service. We we provide a wellness service, one-on-one assisted stretching, and we offer 25-minute stretches and 50-minute stretches. And we're gonna get to market and advertise to this XPass world. And I think that we're gonna get be able to get to do some cool stuff internally to drive a lot of people into stretch lab to take advantage of um what can help benefit them. And you know, one of the benefits of stretching is improving performance, one of the other benefits of stretching is reducing the risk of injury. Um, so so that those are really important characteristics and and and um end goals that we can give to all of our XPass users. Um so excited about that. Um the other the other piece of technology that I'll I'll add here to this conversation is what we call Exponential Plus, which is our video on demand platform. And the I I think the two are gonna work well together. So each of our um, similar to um, you know, Peloton obviously is is the big one, and then there's a lot of other um concepts, fitness concepts that that have some kind of video on demand product. And what we're clear on at Exponential Fitness is that in order to be successful post-COVID, is that you have to have a presence both digitally and a four-wall experience. And the best brands are are gonna meld those two together so that there is some kind of combination of a four-wall experience, in-person experience, plus a digital experience that should enhance each other. And in stretch lab world in particular, um, what we um, you know, we had this vision, my my team, we had been talking about um creating some kind of video platform for stretching so that our customers, our members could do some kind of stretching on their own at home in addition to coming into the studio. And, you know, it was just really, you know, luck. I don't think Anthony foresaw any um pandemic happening. But pre-pandemic, we actually bought a production facility across the street from our office. So we have a full video production facility that we use on a weekly basis, all the exponential brands use on a weekly basis. And that's um, you know, Exponential Plus is our newly branded video platform. Each of um, again, people can buy a monthly fee and just have video on demand. Um, stretch Lab World, we're doing, we're we're adding a little twist to it where if you're a stretch lab member, if you're a member of one of our studios, you get access to all of the stretch lab video content as a part of your membership. And this is what I mean by trying to meld those two worlds of in-studio experience and digital experience. And you know, if you if you or anyone's been to PT, classic physical therapy back in the day, you go, you get some manual treatment, and they they give you a sheet of paper, right? It's like, hey, take this sheet of paper, wait, let me let me draw on this to try to draw a better picture. And then they're like, try to replicate this at home. There's there's been some advances in that technology where there's there's some um video, there's some websites and some apps. And so we've taken it to that next level. And this Exponential Plus platform for Stretch Lab, it has all of our stretching video content broken down by body part, broken down by sport or activity. Um, it's broken down by a bunch of different ways so that it's easy to find, easy to, easy to scroll through. And our flexologists are giving our members homework. And it's a way to interact. You know, most members come in once a week. We have some members that come in more, but most members average once a week for a stretch. But we know just like in strength training, you work out, you lift weights once a week, you're not gonna see significant gains in strength. Same thing with stretching. If you stretch once a week, it's it's better than zero, but it's not good enough to truly make the gains you need to make to improve performance, decrease risk of injury, etc. And so we we have this homework tool that's our mobile app and it's and it's got video content, and our flexologist can see have our members been watching, what did they watch, et cetera? We can tag it. So we're really um stretch top world, we're trying to use technology uh not to take the place of stretching, because we learned that was one of the big lessons we learned in COVID. We had all these, all we had these 25-minute stretching videos, 50-minute stretching videos, we put them out there for free for all of our members. You know what happened? No one watched them. They they'd watch like the first three, four minutes, and then we we had all this data. They'd watch three, four, five minutes, and that was it. And and then they'd they'd log off. So we so we learned that one people don't like to stretch themselves. So there's a reason why stretch lab is successful, because just like there are physical therapists out there and chiropractors and massage therapists that are successful, when you provide a good service that people can't quite do as well on their own, you've got a good business. And that's what we have with stretch lab. And then we shortened the videos and made it more relevant so that they can, you know, 45 seconds, a minute and a half, like, you know, really no more than like a two-minute video of a stretch and how to do a stretch so that these members can can really watch and learn and and start to teach themselves some of the stuff as well. So I feel like we're we're really well positioned for this year. I know we're in the midst of another um spike here. Um, but one of the things I can tell you is that we're not scared. We're not operating from a place of fear. We have the tools necessary. We have, we know how to operate. If there are restrictions, like whether it's not as many people in the studio or you have to wear masks or something like that, no problem. We know how to do that. Our our owners and our and our team members, our our members know how to operate in that capacity. We've got the technology. We we know how to deliver in studio plus four wall. We're melding that experience. Um our attrition levels are are continuing to drop. We talked earlier, our lead flow is up. We're seeing more demand, not just for stretch law, but across all of the exponential brands. Lead flow is up this year, this this month in January. So that's a good sign too. And and my my personal feeling, my personal hope of all this is that the our country is starting to realize that we're gonna we need to learn how to live with COVID because it it's gonna be here for a while. And the better we take care of ourselves, and this is my personal hope and just being passionate about this industry, is that people are realizing that they have to take better care of themselves. Not only they have to move their bodies, they have to watch what they put in their bodies. Um, supplementation and hydration is super important. Um, the we know, and I don't think we know the full extent yet of the mental health impact that COVID is going to have, not just on us adults and business owners, but also on our kids. And and and I think stretch lab uh um plays an important role in that. There's something about the personal touch that I mentioned earlier, and actually getting a stretch and having someone put their hands on you and move and manipulate your body and help you to feel better coming out of that. There's there's a there's a stress relief getting a stretch. Whether you're stretching on your own or you're going to a stretch lab studio, there is a relief of stress after you're done a stretch. 100% that is absolutely going to happen every single time. And I know across the exponential fitness landscape, any of our workouts, working out is going to be good for you. You don't you work out more, you're going to be better prepared to handle anything that the world throws at you, whether it's additional illnesses and viruses, or whether it's just a rough day at the office. Um, boutique fitness and wellness services are going to play an important role in the overall health, wellness, mental health, emotional health of all of us. And that that's why I'm excited to be here today where I sit, because I think there's such a huge long runway for boutique fitness and wellness in in our country today. There's there's there's a lot of work we have left to do.

Yeah, man, I agree. I think there's a lot of opportunity to go into this year. And you know what I'm finding, what I find really interesting about Stretch Lab too is how it's so complementary. You know, um one of my favorite people in fitness is uh Kelly Starrett, who's, you know, kind of a he really made mobility a thing. Like he almost defined a category like 15 years ago. And uh, you know, he's very smart, um, very good entrepreneur, not just a good coach, but he identified that like mobility. You are complementary to almost every other modality in fitness, right? Now, is it always the primary driver that most consumers are looking for? Like, are they like, well, I just want to be more flexible? Not often, but if they start exercising and start moving, they're gonna realize I need to be more mobile, right? If I want to do this, especially if they find something they're passionate about and they're like, well, you know, I want to play uh, I don't know, racquetball for the rest of my life. Like me personally, I want to ski for the rest of my life, right? I want to, I see people skiing in their 80s. I'm like, that is amazing. I want to be doing that. And so what does that mean? It means I need to start taking care of myself on a consistent basis. So it's really interesting what you guys are doing there because I think that's that's the beauty. It's complimentary. It's not competitive to anything, right? You're not competing against a spin studio, you're not competing against a hit or you know, a strength or a crossfit. You're not competing against that stuff, you're complimentary to it. Um, but that is both the advantage and the challenge, right? Um, it's it's not the primary driver. So it's it's it's an interesting thing that you guys got going here on here. And then you add in X Pass, that's just perfectly positions you guys as being that one to two time a week, you know, kind of go work hard, take care of yourself over here, right? And finding that balance and so on, so in training. Right. Yeah, man. It's really cool. Um, I'm curious. One last question for me because I know we're butting up on time, but obviously for X Pass to be successful, it has to have a good market for it, right? You have to have a certain amount of options for people to go to. So far early on in this state, what what markets um have you guys seen the most success with with X Pass?

Um in what way and types of regional market country? Yeah. Uh it's really been all over. We um launched in a couple markets um in Q3, we expanded in Q4, and then at the very end of Q4, we expanded nationwide. Uh so we are really seeing really good traction all over the country. Um there there really isn't data pointing to like, oh, it's it's happening in this city, but not this city, or it's this suburb but not this city. Um there's so far there's there's traction all over the country. And I think the the more we grow awareness of exponential fitness, I mean that that's the next challenge. You know, we talked earlier about marketing sales and then customer experience. The the marketing piece of it, exponential fitness went public last this past summer. No one still really knows who exponential fitness is. They they know some of our brands. Some of our brands are well known, Club Pilates, Pure Bar, Cycle Bar, um, really big, well-known brands. And now we've got Rumble and BFT. I think the more these brands are are become uh open more locations and create more awareness, there's just a super long runway for XPass. And and that's that's where we're targeting a lot of our marketing and advertising now. Are former members of any of the studios and former leads that never converted into members. So that's where it that's probably some of the most interesting data so far is that we're seeing um, you know, it's it's around 50% of our X Pass members currently were either former members of a studio and and had since left, or they were leads in somewhere, one of our studios somewhere in the country, and never actually came in and bought a membership to that studio, but then they saw value in X Pass. And I think the the the cool story about that for anyone listening to this podcast, the big takeaway for that is that the there's people have needs that want to be met. And if you are a business, you have to figure out how do I meet those needs. You know, just because I open a stretch lab in Irvine, which is where I'm located today, let's say I open up a stretch lab here, doesn't mean that every single lead is gonna want to come into this Irvine studio. Part of the reason why franchising is successful. You you grow the brand by opening all over the country and you're gonna create a more awareness. And some leads are gonna come into your studio that you didn't pay for. It's not a digital lead. You didn't pay for that, but because they had a friend, family member, whatever they got in, um, same thing the opposite way, and that's the other reason why we're we're so excited about XPass. It gives us additional ways to help our franchise partners to drive leads into our franchise partners' studios to help our franchise partners make more money. So we can have we have a mechanism now, a tool in our toolbox that can pick up old leads that said, Hey, I want to learn more, but they never were actually interested in writing the handing over the credit card to become a member. For whatever reason, something changed over the last six to 12 months. And now they're like, hey, this X Pass offer looks interesting. I want to go use that. And I think so, and then we're also going to track the the lifespan of that X Pass member and to see where they go and how many of the X Pass members then actually become members of a studio. So we're starting to start to see that trend of someone actually comes in through XPass and they're snacking here and snacking there and snacking there, and then they're like, oh, you know what? I've taken a couple rowing classes now, I've taken a couple dance classes now. Like, I I really like that. You know, I'm gonna go ask them about that. That's and they become a member there. And they may keep their XPass membership, they may end up letting it cancel, and then they just become a member somewhere else. So everyone's gonna have a different customer journey. And and the and and this is why it's so valuable. And what I'm what I love about exponential fitness, what I said this earlier, but this is another way to highlight it. We are excellent and or experts at marketing and sales for boutique fitness. And our franchise partners are not, and that's okay. We we ex we don't expect them to be when they come into the franchise. That's what they're investing in. They're investing in exponential fitness to be a part of and buy into and get a piece of that expertise of marketing and sales. And it's the technology piece too. It's the underlying technology that Exponential Fitness has invested in that's going to continue to drive more and more franchise partners to want to be a part of this. And X Pass and Exponential Plus, those are just add-ons that help us recycle old leads and old prospects and old members to get them back in to ultimately drive more business into the franchise partner studios.

Awesome, man. Well, Lou, this has uh been super insightful. I mean, it's it's it's pretty clear after a conversation that, you know, Exponential and Stretch Lab, you guys have extremely good systems in place. And that's, you know, for people who are uh like I think even in the description or the the background that you sent me so I could get ready for this interview, you mentioned you know, there's a lot of people out there who want to be their own boss, who want to have their own business, but maybe they don't want to go through the painstaking process of creating all the systems that go behind it, right? Right. Because I think we've all done that, and that's can be painful and times. It's a it's a lot of heavy lifting, is what it is. It is, and that's uh it's it's a really cool value proposition. So yeah, man, thank you so much for coming on. Where do people get a hold of if they want to talk to you about the various things you do, stretch lab and XPass and um just you personally, where would you send them?

Yeah, uh, you know, website stretchlab.com is the best place if you want to find out more about stretch lab. Um we're we're on Instagram as well and um active on uh on Instagram. We have a lot, and and then I the other place I always tell people got 150 locations and growing across the country. Go visit one. Uh you know, that that's the best way to really understand what we're doing. Go go visit a local studio. Um, they do intro stretches, and um, I know they'd love to have you.

Right on. Lou, thank you for coming on, man. It's been an absolute pleasure, and uh I look forward to kind of checking in on the progress of this of all these projects you got going on in a few months' time and uh getting a little update here. So, ladies and gentlemen, Lou DiFrancisco. Thanks, Eric. Hey, wait, don't leave yet. This is your host, Eric Malzone, and I hope you enjoyed this episode of Future of Minute. If you did, I'm gonna ask you to do three simple things. It takes under five minutes and it goes such a long way. We really appreciate it. Number one, please subscribe to our show wherever you listen to it. iTunes, Spotify, Castbox, whatever it may be. Number two, please leave us a favorable review. Number three, share. Put it on social media, talk about it to your friends, send it in a text message, whatever it may be. Please share this episode because we put a lot of work into it. We want to make sure that as many people are getting value out of it as possible. Lastly, if you'd like to learn more, get in touch with me, simply go to the futurofitness.co. You can subscribe to our newsletter there, or you can simply get in touch with me as I love to hear from our listeners. So thank you so much. This is Eric Malzone, and this is the future of fitness. Have a great day.