The Rise of F45 - Luke Armstrong

At some point, no matter how good you are, there's going to be somebody that comes out claiming to have a better workout or a better brand or a better, you know, widget. And so, you know, I think you've got to expect that your community is going to go and test that. But if you've got that culture, if there are social connections going on and they feel like they're a part of something, they're going to come back.

Hey Fitness fans, welcome back to the Future of Fitness podcast and interview series. This is your host, Eric Malzone. And this is episode number 109. I talked to Luke Armstrong. He is a CEO at F-45. So if you're not familiar with F-45, it is an extremely fast-growing franchise of gyms. Um started in Sydney, Australia, where he's from, um, and is now spanning the globe. I think at the time of this recording in the interview, uh, he said he's around 1,300 uh gyms. I'm sure they are now well past 1500 uh and growing and looking to expand into uh huge markets like Asia and a couple areas as well. So um yeah, and just you know, their their story and what they've done and how they've made you know things like functional fitness, um, you know, cross, for example, into a more adaptable model um that can scale. It's brilliant. It really is. I'm a huge fan. So um lots to learn in this episode. And uh before I do that, I just want to read a review from ReadViews, whoever that may be. Five-star review for this podcast. Eric finds great people to sh to feature and brings the best out of people he talks to. His authenticity and sincerity really comes through. Be sure to subscribe. You will enjoy it. Thank you so much, and I hope you do subscribe. Uh, please go to iTunes or Stitcher, wherever you're listening to this, and uh subscribe to this show. Um, it's also on YouTube. You can do it there. Uh leave a great review, and if I see the review on iTunes, I will read it on the show just like I did for read views. Um, yeah, have fun with it. It only takes two minutes, right? If you're getting value out of the show, do me a favor, go do it. I would greatly appreciate it. Uh, we put a lot of work into these, and if you're finding value, yeah, give us a review. That's it. Subscribe. Simple, right? So without further ado, let's get into episode 109 with Luke Armstrong from F-45. Enjoy the show. All right, Luke Armstrong, my friend, welcome to the show. It's uh it's gonna be a lot of fun having you here.

Thanks for having me, Eric. Regards from uh from Sydney, Australia.

Yeah, yeah, this is great. I love uh, first of all, I love Australian accents, so that always makes it you know puts me in a better mood. And then um, you know, it's just so cool that I get to talk to people from all over the world and uh you know seemingly in the same room and have really uh insightful conversations. And you know, primarily we're gonna talk a lot today, I'm sure, about F-45 and and the amazing things you guys are doing with growing that business and what it means, the things we can learn from as an industry um from what you guys are doing. And yeah, I think before we do that, can you just give us a quick bio, Luke? Tell us about yourself and we'll get into into the other things.

Sure. Yeah, so uh I'm I'm Australian, uh grew up in Sydney. Um athletics was was really, really important to me um all throughout high school, played basketball very intensely uh and really developed a love of of training, um, which you know I've kept uh my my whole life. Um in my 20s, I uh started to focus on the career. I I spent some time in London, Switzerland, and uh and New York City uh working in in finance, and then um at about the time we had our first child, we decided to relocate uh an uproot uh come back home and uh and and and put the proverbial roots in the ground. It was at a time when um I'd been um thinking about you know alternate careers for some time. Uh the the whole Lehman fiasco um really um I think caused a lot of people in in the industry to kind of rethink uh their their their purpose. And um so you know, if if I'm honest, it was it was rather serendipitous. I just came back without really a plan. Um but it kind of put me in a position where I could start to consider alternatives. And a good friend of mine, lifelong friend of mine, Rob Deutsch, who had a similar uh has a similar background, um, had come home from from the UK about a year prior and decided to um uh start again. Um his passion was training. He started a uh he got his accreditation and started a um a small uh group fitness uh business, started outdoors and then um he moved it indoors and uh basically developed in in very little time, about 12 months, this uh cult following, um, which was the genesis of F-45. And so at that time um coming back, we reconnected. Uh, I was in a position where I you know I didn't really have a lot of control over you know what what was going to happen in the short term, so I decided to refocus back on on getting fit, which was something that I I could control. Uh so he invited me down, and that was the the beginning of my my uh my experience with F-45. Uh we we started uh conversation about you know what the next step was for him. It was very clear that he was onto something. Um the the gym was just bursting at the seams, basically. So uh yeah, at about that time he had the idea to to begin franchising it, which uh in Australia, I mean the franchise industry is is developed. Um it's nowhere near as mature as you see there in North America. Um so it was it was quite it was very new. I mean, I have to admit, I don't think we knew very much about franchising then, but um we had uh we had a sense that we we knew that we needed to get big and and get big quickly um because this was going to be something that that was definitely going to trend it's you know the combining the community with um short, sharp, highly varied workouts. Um and obviously that sounds a lot like CrossFit, but we we deliberately you know modified the movements so that it wouldn't require people to necessarily be at elite levels of fitness or um putting themselves in positions where they're perhaps prone to to bad injury. So um uh quite a different audience, um, predominantly female, about two-thirds of our membership are female. Um, but you know, love training and uh um love the social aspect of it. Uh anyway, sorry, I got off on a bit of a tangent, but um yeah, we we started franchising it domestically. Um our focus was um we wanted to get to about 20 studios in the first year, and uh fast forward 12 months we were at 110 franchises sold. Um so it just it really exploded. Um the more we opened, the more it caught on. People were were being introduced to this, and a lot of the users were becoming really enamored with the whole phenomenon, uh, and then wanting to put put their capital at work and and you know join us in this in this uh in this mission. And so um, yeah, that that the the domestic um chapter lasted about three years. We sold out Australia in that time, 550 franchises, and then started franchising offshore. Um, and for the most part, it was led by uh the inquiries greatly helped by social media. Um we're now in nearly 40 countries. I think it's 38 countries that last count. Um, 1,300 units sold, about 900 of those are open. Um, good presence obviously here in Australia, and then uh a growing presence there in in North America, the UK, um, and and you know, shortly all over the world.

Yeah, awesome. What a story, man. What a story. So I'm I'm curious because you know, like uh, you know, I'm gonna draw probably unnecessary parallels to CrossFit, but I think uh, you know, when you talk to CrossFitters, CrossFit coaches, they always have that experience that got them hooked on what it was. And you mentioned you went into F-45 and you had an experience. What is that, what was that F-45 initial experience that made you say, like, there's something special going on here? Like, what was it that hooked you?

I I think the the genesis of F-45 was just the realization that you know, some point between 17 and 25, the the the notion of m deliberately moving became you know something that went from being, you know, you really look forward to. I mean, I used to love training, I used to love playing, to dreading going to the gym, dragging yourself to the gym, almost kind of finding any excuse not to go. Um, and and you know, it's it's it's a tragedy. Um and so I think for me what what resonated so strongly so immediately was that you know, I recognized this, this was community-based, it was fun, um, there was a social element to it. There was also play. I mean, we we're quite big on gamification. Um, and yeah, it was it was it was something that you could, I I I I thought immediately like this is something I could do every day. And um it was it was you know, it it's it's it's a lot of fun moving. Um, you know, that that that endorphin rush you get after a great workout, you know, there aren't aren't too many things like that. And uh, you know, the more you do it, the the the better you function, um, the better you look, the better you feel, and it becomes, you know, very uh, I think self-reinforcing.

Yeah, cool. I like that. And then the gamification, that's that's always been a huge factor, I think, in any type of adult exercise program. Because you're right, man. I reflect now, listen to your words, and somewhere, you know, as an athlete my whole life, probably mid-20s, is when I was like, this working out thing is is really become a chore. And then five years later is when I kind of got into to CrossFit and found it to be a lot more fun. And with F45, you know, from a from a training standpoint, not necessarily business, but um, it's similar, it's it's it's functional, it's um, you know, high intensity at certain points, but there is no like Olympic weightlifting, right? There's no is there gymnastics involved? What does it look like from a programming standpoint?

Yeah, I mean it's a i i in in basic terms, most of our workouts are a 45-minute interval circuit. Um there's a there's a heavy emphasis on on functional movement. The F in F 45 stands for functional, functional 45. Okay. Um so and and yeah, we we play to time. So, you know, as as I think everybody listening is will will understand, you know, moving and moving with a with the discipline of time are two very different things. And so, yeah, the workouts are short, sharp. Um, we've become synonymous with high-intensity interval training, but not all of our workouts are high intensity. Um we alternate, we tend to alternate cardio and resistance um to ensure that you know the whole body is getting worked. Um, we go through phases where we focus on different muscle groups, different energy systems. Um the the intention with the programming, I mean, there's a lot of substance behind the programming, but um I think the variation um from both a physical and a and a and a neurological standpoint ensures that it never feels boring or repetitive. Um, you know, you're always being forced to do different movements. Some you know well, like a burpee, um, others might be, you know, you might be doing for the very first time. So we we tr we try and navigate that line between you know providing a structure and a and a format which people know and understand. When you turn up um on a Monday morning and it might be an Athletica uh program, which is our um signature cardio workout, it's one of our longest-standing workouts, you know it's gonna be um nine stations, 45 minutes, 27 people, but you don't know exactly what you're gonna be doing in that workout. So I think that's the similarity with CrossFit, um, you know, the community, the functional modality, um, and and the the discipline of time. Um, but yeah, where it's different is that we that there's no Olympic lifting, there's no gymnastics. We've we've we're I think we've done a quite a good job of creating a um uh a way of training which is is scalable. And I and I know that that that term gets a lot of use at the moment, but you know, you could be a first timer and come in and pick up uh you know, do an F-45 workout and get a really great workout, and you could be training next to you know an athlete who trains with us on a daily basis, and you won't feel you won't be lost, you won't feel left out. Um, and so I think if I might say we've probably done a better job at creating a a more diverse environment, um, which is you know from a commercial standpoint, I think has really helped our franchisees there. They're not just catering to um you know that elite top one or two percent. Um and I know that some people will argue argue that with with respect to CrossFit, but you know, we we we very much advocate come one, come all, and um, you know, we pride ourselves on on being able to to cater to to all levels of fitness and and you know be a gateway for a lot of the community who until now have really you know uh dispelled the notion of going to gym because their you know their prior experience was was uh was so discouraging.

Yeah. Yeah. And I you know ultimately when you know one of the things that separates CrossFit, that one of the things that kind of holds it back is the technicality of the skills that you have to learn. You know, that was a big thing is you know, I would love to have from a marketing standpoint, you know, when as I own my my CrossFit affiliate, I would have loved to have been like, hey, two weeks for free. You know, come in, check it out, get a vibe, right? Because once people get in the community, they can vibe for what it's like, they can feel it, and they can experience it, there's a good chance they're gonna get hooked. CrossFit couldn't do that because you can't just take someone off the street and be like, okay, cool, today's Tuesday, we're working on, you know, a snatch balance, right? Good luck. Like, because what happens? Then the coach takes, you know, 80% of their time, making sure this new person off the street is not getting hurt, right? Because there needs to be some kind of proper on-ramping program or you know, with your guys' program, it eliminates almost all of those problems and objections, right? It goes straight to it, be like, hey, join the community. These workshops are you know universally adaptable to to most people. And that's like the truth. Like we talk about in CrossFit, like, okay, well, cool. You know, someone who has a shoulder injury can still do snatching, they'll just do it with a PVC pipe or they'll do with a dumbbell. But it's not the same. It's not the same. You know, it's just not. Um, so I think that's you know where maybe a better mousetrap has kind of come in uh and taken a lot of things that that you guys have learned or that people have learned from CrossFit that are valuable. That makes it a lot easier to market, I would imagine, right?

Yeah, it probably does. Um, I mean, I've I've never really thought of it like that, but uh, but but yeah, look, um, you know, having having a having a product that you have great faith in in its application to you know virtually anybody uh that does allow you to be very aggressive with the marketing. And I think um, you know, that was something that we we were known for initially was you know, a lot of people said, Oh, you know, these guys are phenomenal marketers. I'm not sure, well maybe that was true, but we just stood by our product and you know we were very happy to you know put a put 500 bucks behind a Facebook, a targeted Facebook campaign for a month or two um and and get those leads in if that if that's what it took. But um, you know, at the end of the day, again, not dissimilar to CrossFit. I think the the thing that really sold it and and continues to sell it is the advocacy from its its community. So, you know, our market, the marketing philosophy in a nutshell, which which definitely has relevance in in CrossFit as well, is you know, digital. So, you know, before you open, you know, a lot of digital marketing, get people interested, give them an offer, and then get them into the gym and and deliver on those expectations so that um you'll you'll you'll grow membership and then reward those those members of your community for becoming advocates and getting people involved. The great thing about group fitness is that it's it's such a better workout when you've got a buddy or a you know your your brother or your sister next to you, um, assuming you like your brother and sister. Uh and so um, yeah, if if you if if you've got a great product and it and it's and it's inclusive, it's community-based, it it it you know, it does a lot of the marketing work for you. I think the other thing we've learned is that marketing to the female segment or or being being popular with that segment um has also been quite helpful because naturally I think it's fair to say that women will refer um better than than than us guys. If they find something that they love, um, you know, the next time you see them, they'll bring their best friend or their you know their their mom, it's the case might be. And so that has also helped us being being very female friendly and providing a um an environment where girls don't feel in intimidated or you know out of place um has also from a commercial standpoint been a been a real a real boon.

Yeah, yeah, oh absolutely. I mean, I try to I look and many, many of my longstanding uh male clients um came because their wife had already joined or their significant other had already joined. You know, that was the always joke, is like, you know, the wife or significant other uh comes in, she gets in good shape, she starts maybe goes on a hike with her husband or boyfriend, makes it the top of the hill, the guy's dying. He's like, okay, now the ego kicks in, right? Like, okay, fine. I'll do this, I'll do this F-45 or CrossFit thing, fine. Um, but yeah, women are are definitely uh more fun to market to because you generally see uh success with it. And you know, if someone's um if someone's thinking about, you're like, hey, I want I want to own an F-45, right? What what does that process look like? Where is there an application? I'm sure there's an application process. Like, how do you guys walk people through that that ownership?

Sure, yeah. So there is a process. I mean, we are I suppose it should be noted that we are a franchise system, um, which is another, I guess I guess, key distinction from from from CrossFit. So um there is a defined business system that supports the the delivery of of our of our workouts. Um and essentially, in a nutshell, it's it's it's relatively cheap to open, um, very simple to operate, doesn't require a huge um you know workforce and uh and and ultimately profitable um as long as it's executed correctly. Um so to the application process, yeah. I mean, most people would um uh would apply online and it'd come through the inquiry, it'd come through at the head office. Um we would uh spend probably about two months in in consultation. Um there's three rounds of interviews, and then at the end of that, if the decision was made to go forward and you know, we were happy to to bring them on board, then um then uh we would uh bring them to either headquarters in Sydney or Los Angeles for a five-day induction where we cover as much as we can on the system, both the fitness systems and also the business system, um, and then they will start the process of of getting operational, which on average takes about four to five months. So they'd have to find a location, you know, hire staff, um, conduct their pre-opened marketing, do the do the construction, and then and then open. Um so uh yeah, the process takes about three somewhere between three and five months, usually depending on the the length of time to secure that location.

Awesome. And do you think like when you look at the most successful F-45 franchise owners, which I'm sure you guys analyze this data, you know, what does that person look like? Is there a certain you know avatar or is there certain little business acumen that has to come into it? Is it people who have been training people for a decade? Like what are some of the most successful F-45 owners out there? What do they look like?

Yeah, so I think a lot of people um at first on first inspection come to the view that you know it's all about the location or it's all about the trainers. Um, and both of those things are really important. But actually, what what my experience has taught me um both as an observer and also as a franchisee myself is that ultimately it's about the the execution and and and how the the the quality of the delivery, both with regard to the business and and also the the the customer. So um, you know, for if I'm if I'm honest, we we've got standout franchisees that come from all walks of life. They're not necessarily fit fitness pros. Um, they're not necessarily entrepreneurs, they're they're they're firstly they're passionate about fitness and they their buy-in to F45 is you know is is uh is very strong. Um they're they're good team players, they're very thorough, um, they understand the importance of uh you know delivery and execution, marketing, and and ultimately community and culture. Um, you know, there needs to be a certain level of financial standing. It's probably going to cost in in US dollar terms, realistically, it's probably gonna cost somewhere between 200 and 250k to get operational. So, you know, this is not a it's not a uh a backyard operation, but um, you know, within the realm of opening up a gym, it's it's it's pretty accessible. Um yeah, so so those tend to be the those tend to be the uh the the the the common traits of of the best operators. And you know, we'd like to think that our system um puts a lot of contingency around that. So if you're you know, if you're if you're a great trainer and not so not so strong on the business acumen, um, you know, as a result of doing the induction and and following our our roadmap, um uh you know, your your your chances of success are very high. I mean, touch wood to date, we haven't had any had to haven't had to close any any boxes uh or any any studios for uh you know for commercial reasons. So it's um it's so far been a been a pretty successful model commercially for our franchisees.

Yeah, smashing success for sure. Uh you mentioned culture, right? That's a big part of Think of any, you know, what I would classify as like micro gym or you know, box, you know, small box gyms. Um, how do you guys get that that sense of culture? Do you have a roadmap for that? Do you give like certain criteria of how to develop culture? Because that's something that a lot of people want. People want culture, they want community, but they don't know how to foster it, you know. And I think anytime you see, you know, success, you guys have just grown like wildfire, right? There's there's always got to be that community aspect. People want to talk about it, it's the buzz, right? Is there something you guys have done intentionally to create that and create it for all of your franchisees, or is it something that you just was kind of baked into what you guys were doing through the founders and and the vibe of it all?

Um look, I think it's both, if I'm honest. I mean, certainly being you know, being a community-based um format helps. I mean, it's it's a social outlet. Yeah um, but but also recognizing that and um um you know building around that has helped. So, you know, as I said, when we're when we're screening these these candidates, we we we you know, we want to know these people coming in are strong on communication. You know, I like I like to see personally, I like to see some sort of history of of team sport or you know, team team involvement. It might not necessarily need to be sport, but you know, it could be be in the professional sense. Um there there's going to be an interest um we know in connecting outside the gym. So um the best operators uh go above and beyond and and you know create uh opportunities for their community to opt in to, I don't know, watch this the Super Bowl or you know, go and and have a barbecue after one of our challenges or or have a Christmas party, whatever the case might be. Um I think social media also plays a big role because it's you know it's our shopfront in this day and age. So you know, having having engaging, inclusive social media presence is also is also vital. So yeah, I mean it's a it's a combination of of both those things, but um it's certainly a focal point. And as I said, I think ultimately the most successful operators, and this probably not doesn't apply just to just to a 45, um, recognize that that that the culture is actually paramount. Um you know, you you can have a you can have an off day, you know, trainer might not be, you know, might might not have had best night's sleep or the the music, the playlist might not be great, but if you've got if you've got a great culture going on, it's gonna keep people coming back. So you know the way I regard it is you know often our our our workouts and the and kind of the noise on the street will will bring people into the studio, but it's the culture that's gonna keep them because at some point, no matter how good you are, there's gonna be somebody that comes out claiming to have a better workout or a better brand or a better you know widget. And so, you know, I think you've got to expect that your community gonna go and test that, but if you've got that culture, if there are social connections going on um and they feel like they're a part of something, that they they're gonna come back.

Yeah. Yeah. You know, it's interesting. And I, you know, I started in the CrossFit movement around 07 and seeing that thing boom, and you know, I'll probably get lamb-basted for saying this by somebody, but you know, it I feel like it's even in some ways taken the place of what church has been to a lot of people over the years, you know, especially like you know, you go to you know, a successful F-45, I would imagine, or even you know, a CrossFit affiliate, you go to on a Saturday or on a Saturday morning, and you get to feel what it's like to have that community of people. Everyone knows it's it's it's a really, really cool thing. And I think it's taken that tribal, I mean, it I don't think it has, it's taken that tribal feeling and it's boiled it down into something where people go to that's not really dogmatic, right?

No, I mean that you know it's it's it's you know, training training hard is the ultimate leveler. You know, it it's it's when when you're when you're when you're in there, you know, you're you're you're in your in the pain cave and you're in there with other people, you might have nothing else in common except that you're in there hurting and it's it's incredibly, you know, there's a bond. Um and so uh look I mean to just to back you up, I I've I've I've had that realization um uh many times that this is communion um and uh it's a commonality. And I think this is what I I mean I spend a lot of my time now um not in in the markets that we have great presence. So I spend a lot of time in these sort of new frontier markets, and um so I see that that the one great thing about fitness is that it's it's a universal language, um, and and and this this boom that we saw in in you know boutique fitness that kind of um emerged out of the global financial crisis, the most recent one, um, is is not just confined to the Anglo the Anglo-speaking world. It's uh it's it's very much happening in in Asia, it's happening in Africa, it's happening in the Middle East, it's happening in Eastern Europe, and um and it's awesome. You know, you you can have nothing in common except the fact that you're gonna go and go and get it for 45 minutes with uh with someone else, and uh and you know it's it's uh it's it's it's a great it's it's it's like a universal language now. Yeah it crosses religion, it crosses language, it crosses culture, it crosses history.

Yeah, yeah, it really is cool. And and it, you know, I think you and I were connected by Natalie Dow out in Singapore and talking to her about you know this. Shout out to Nat. Yeah, yeah, Natalie, she's awesome. Um what is what is it, rock or something? Rockstar arms. Rockstar Arms, yeah. Rockstar Arms, check her out. Um you know, the boom that's going on there, and it's universal. You know, it doesn't matter what religion you come from, what whatever it is, fitness is fitness, and it has this movement behind it. There's amazing things going on in the Asian market, which I'm sure you guys are familiar with. Uh so you you mentioned something about emerging markets that that you're going into, and that's that's exciting. It must be a fun part of your job, right? Kind of sniffing out where new opportunities are. Um, you know, give us some insights. What have you been looking at? Is there any areas that you think are um kind of the next big boom in fitness?

I mean, look, uh I I sound like the ultimate bull I realize, but but I think as I said, all my experience so far has just taught me that this is this is this is a global trend. I mean, some markets are are ahead of others. Um, but uh uh ironically and counterintuitively, I think the biggest opportunities are those markets where you you don't see a clear precedent because it's it's very it can be very valuable being first and it can be very valuable being the catalyst for that change. Um so yeah, I mean look, you when you're on the ground in in Asia, you can see that there's a real interest in um you know a lot of the things that the that we in the West take for granted now, um both in terms of education, in terms of wellness, in terms of diet. Um so you know, there are very exciting things going on, you know, all throughout Southeast Asia. We've we've got five uh and and and shortly six six F-45 franchises open in China. Um so you know it's it's cool seeing that we're able to go into a market where there's very little, well there's virtually zero language overlap. Um it's very different culturally, but you know, we we we seem to have uh a language or or modality there that resonates. Um we've got uh you know we've got studios open in in French Polynesia. Um we've just started franchising uh in in South Africa, which is which is really starting to take off. We've got three open in uh in Cape Town, we're about to open another one in in Johannesburg and shortly Durban. Um the Middle East, I think, is also is also very interesting, and uh I know that there's a lot of uh a lot of interest, there's a lot of inquiry coming out of Eastern Europe as well. So um, yeah, I mean I think I think everywhere is is is very interesting, but but I mean certainly for us Asia is is uh is the you know a very very good market at the moment. Um the proximity to Asia has helped us. Also, the um the presence of Aussie expats on the ground, it should be said, has has also helped us because um uh it allows us to bypass a lot of the early discovery when we're talking to somebody who came back home for Christmas and worked out with us and loved it and wants to take this to you know Hong Kong or London or or uh or China or wherever. It's um it it's it's it's definitely helped us grow being a an Aussie brand with with um now Aussie franchisees, you know, in in various parts of the world. We're big on travel. Um and uh and and so yeah, that that has certainly helped us spawn very quickly.

Yeah, awesome. Yeah, I had a great interview with um Joseph Pierce, who he runs a CrossFit affiliate out of Amman Jordan, and he's only one of two affiliates in Amman, which is like a I believe five million in population. So you can see, and he's just you know, people are coming in, he's he's growing, and you know, there's just these markets that you never would have thought of, right, globally. Then maybe this would be a good place to to put a culture community-based fitness um mode.

100%. And you know, I I think I think the um, you know, the w when when you talk about boutique in in in North America, you know, names like SoulCycle, Barry's come to mind, and you know, that there's a place for them, no doubt. But what our experience has has taught us is that you know that that experience is not confined to you know the the ultra premium precincts in in you know the most densely populated urbanized cities. Uh it it's you know, everybody wants to train like this, everybody wants to connect socially, everybody is is increasingly time poor. Um, everybody wants to get results out of their training. So I think one thing that makes us quite unique within you know within that that that segment is that we've been willing to go into these frontier markets and open up an F-45 when there isn't really a precedent. Uh and when a lot of people, frankly, probably say, you know, I d I don't like your chances of uh of of sticking it out in in Manila. Um uh so yeah, I mean I think there are a lot of people who who probably look at look at our growth and are saying, all right, well, you know, this is clearly not something that's just a a Sydney, New York, London phenomenon. There are people all over the world who who who will respond to this. Um I think the nice thing about our business model is that it the franchise business model is that it um it offers the the structure of a a systemized business operation um and a formula, but it it also gives the operator um enough flexibility to adapt it to their to their local market. So, you know, pricing, um, timetabling, um, you know, and and and and obviously language, uh that that is all scalable, that can be that can be adapted. Um, but the the the core infrastructure, the the the skeleton of the business is uh is is is already there and they can just basically um plug it in and and and and play straight away.

Yeah. And that that piece, right, that structure is so incredibly valuable to, you know, there's there's so many coaches and trainers out there who feel that their next logical step when they want to stop trading their time for money directly, if they they want to be a facility owner, right? And can't tell you how many times I've talked to people who made that leap without the structure, without the mentorship, without systems, and they think just because, hey, I'm a great coach, you know, I'm a great trainer, everything will fall in line. You know, if I'm good at that, then you know the marketing will take care of itself or the business systems, but it's not that case. And uh, you know, I would if I was, you know, going back 10 years ago and you know, as opening my CrossFit affiliate, if if someone had said, hey, here's a turnkey system, right? That'll just take care of the systems for you. We know it works, we've proven it in other markets. I would have been like, sign me up. You know, that would have that would have taken five years of my life back, most likely.

Well, I I I think it's it's the great tragedy of a lot of small business is that you know, um the those people, you know, they find something that they love that they're passionate about, they think, okay, I want to go and do X and and do that for a living. Um and then you know, the the kind of the minutiae of running a small business takes over and a lot of them become you know uh evolved to kind of hating it, um, which is which is really tragic. So yeah, I mean we I I suppose where we come in for for for those who aren't familiar with F45 is we basically at Head Office have devised um systems and built resources that are very time-intensive for the single operator, you know, things like you know, marketing artwork or building websites or you know, figuring out what payment systems to provide. I mean, this is the stuff when you're a when you're a passionate fitness enthusiast, you know, on the on the on sort of the rung of priorities, it's very, very low. But actually, if you're running a business, it it's it's very important. So, you know, where we add value to our franchisees is we basically give them this infrastructure, we've already tested it, they don't have to spend any time researching where to get equipment, what payment provider to use, what CRM to use. They can just you know implement this straight away, and then because the business is largely automated, um, or or those time-intensive parts of the business are automated, it frees up their time so they can focus on the areas that they can really add value, which is you know delivering a great experience and and and growing their growing their membership and and and retaining that membership through high you know high levels of service and client satisfaction. So um, yeah, I mean uh we we we we heard a lot of this. I mean we've we've got um we've got franchise partners who you know come from many different um um you know careers in in in in the industry um and and and it was a common pain point that you know they they just felt they weren't they went in with best intentions and then you know their ex expectations weren't met or they they they didn't realise how much time was actually going to be required to go into the business itself. Um and you know in in the worst case it just kind of kind of swallows them up and they've got to you know s rebuild. So yeah, we we we took uh we took note of that and and we we felt that I mean CrossFit really shone a light on on a a lot of um new uh approaches to fitness, both in terms of of the training and and in terms of um offering opening a gym, opening a box, it was pared down, it was very basic. Um, you know, in many cases you didn't need a lot of equipment, but we felt that there was uh a a big part of that that that did um that needed some work. I mean um you know it's it's a very libertarian community in many respects, but when it comes to business, if you're gonna have people, you know, flying your flag, uh we we feel that you know you really need to be there to support them and and and you know uh play to play to perhaps their weaknesses. And and for many, for many athletes, many fitness pros, it uh business is a is a is a vulnerability.

Yeah. No, you you just I think you nailed the problem that you guys solve, really. I mean that's that's it is great coaches who want to have who want to be business owners, um, you know, people truly passionate about fitness, but they need the systems, they don't want to figure it out. It took me four years to get to the point where I can work on all those things you were talking about. Just four years to get there, right? So I had enough time to work on the minutiae and it wasn't overwhelming, right? And then I got to work on it, then I got to implement it. So it took another two years. So six years in, I'm probably at the same point that many of your new franchise owners are at right from the get-go because they they invested in systems. So it's you know, from that standpoint, um, you know, it's it's a beautiful, elegant solution. And you know, I know you guys are starting to um expand a little bit, right? Some of the the focus or the service offerings within F-45. So give us some hints, man. What's what's coming down the pipe? Or I think you guys have already made an announcement, and by the time this airs, it'll definitely be out there, I think.

Yeah, sure. So um, I mean, the the the typical F-45 user is 25 to 45 um time poor, might be because they're uh you know they're a professional or or a you know parent. Um uh and you know they love fitness, they love love community, um and and you know, have generally responded very well to to our proposition. Um we have been conscious that there are other parts of the community that um we weren't catering to. And you know, now that we we feel very confident with our our core offering, we're starting to branch into these uh these other segments. So um last week we had our conference. Um you know, we're holding this interview in October, so uh it might might be a little late as you as you mentioned, but yeah, uh we had a conference here last week in in Melbourne. Um we announced that we are bringing out two new systems um dedicated programming for minors aged between 11 and 18. Um and that'll have a focus on um you know team-based functional movement, um, which will be designed to support these kids um physically, emotionally, um and yeah, and and mentally uh through some of the most formative years of their life. Uh and then we're also uh design we're gonna release uh programs aimed at the the seniors segment, which is you know kind of regarded as 60 years and above. Um some of whom already are training with us and that's fine, but many of whom, you know, don't the the the current F 45 proposition doesn't resonate. So uh it'll be it'll be scaled down movements, um, strong emphasis on community, um, strong emphasis on um you know pr prolonging life and uh um you know ensuring that that these these golden years are are some of the best years. Um you know, we're now expected to live a lot longer. I think a lot of people um you know we we work hard into into retirement, and then we get to retirement, you know, thinking, okay, now it's time to travel or or spend more time with family, but you know, perhaps if we haven't been looking after our bodies, uh uh it's it's it's harder and harder to do. So um yeah, we're we're we're gonna be catering to those segments, and I hope by the time this airs, um this should be uh be in effect.

Oh, that's awesome. So if you're uh if you're a current like F-45 franchise owner, um you guys will just implement, just help them implement in these new plans, and I'm sure you know as new people come in. Is there a is it a is it stacked? Is there phases like you build up your 25 to 45, then you stack up to you know another option, then you stack up to you know another additional service offering? How do you guys structure that?

Um yeah, I mean to begin with, so so we're we're we're we're testing this in Australia to start. Um Australia and New Zealand will be the first markets to uh to get X. And um uh I we're expecting to learn a lot um through through through that experience, and then we'll we'll release it uh globally. Um franchisees can potentially um access everything at once if if they were to start up. I think in reality um they are more likely to to probably um cut their teeth on the on the core offering and then venture into the the the miners and the seniors or or F45X as we've called it. So um uh it it will be uh it will be staged. We'll be releasing this from March. And um yeah, I mean time will tell, but I would I would expect that this will be uh global from sort of September next year, September 19.

Yeah. No, that's awesome, man. Those are two segments that are are huge. I mean, especially you look at Western culture and that age group of 11, 18, and that's when you really if you can stave off obesity between those ages and act, you know, and increase activity levels and make it a happen at that age, you're doing a huge justice to to communities because it's it's a big problem. You know, I was a chubby kid, uh ages nine to ten, and then I started to get into sport, you know, um vigorously, and it changed probably the the path of my life, right? Otherwise I would just be eating kudos and playing video you know, Legend of Zelda for the next seven years. If people even know what that is, but uh I think you do. Uh yeah, so that's that's uh that's just a little give me some give me some goals, man. I'm sure you guys, you know, because you have how many current as of October 29th, 2018, how many people, how many franchises do you have right now?

Um so we've we've sold we've franchised about 1,300 territories around the world. Um and uh in in broad terms, it's it's it's it's Australia, New Zealand, it's North America, um, it's it's the UK. Those are kind of our our real strongholds, and then we're kind of scattered throughout uh around that. Um I mean look, our goal frankly is to put F-45 within easy reach of anybody who wants to wants to be involved, wants to try it. Um and so um yeah, you know, we're we're we're interested in in franchising globally. We we very much see this as a as a global phenomenon. Um I did some modeling recently that that seemed to show that the uh saturation point might be as many as 20,000 outlets around the world. So you know, we're about 1300 in. We've got a lot a lot of uh a lot of wood to chop, um, a lot to uh a lot to learn about you know how to implement this in different markets. I think it's going to get um a lot more interesting as as time goes on, which is which is nice. Um uh we've got um some really cool collaborations coming out. We have our own shoe that we've we also announced last week in in collaboration with APL, which is a US brand that we're really excited about. It's been really we're really well received with our community. Certainly, you know, apparel and merchandise is something that um that is is is going to get a lot of focus now that we've got a very established brand. Um Nutrition, we've we've started uh we've we've started uh down that path recently. Um we're doing you know, meal prep for uh here in Australia we're testing it and that's that's been really well received. Um there's also an opportunity for for supplement lines um and you know even active escapes which which is now starting to become more and more mainstream. So I think this is the really exciting thing about being in the in the fitness and wellness space is that you know it this is really the very beginning. And uh I suppose you know you and I kind of sit at the at the at the very forefront of of of this this phenomenon. But my message to the the critics and the skeptics is that you know if if you think that uh you know the the the $50-60 dollar a week gym membership is uh is just a a sign of the times I mean it's it's it's only it's only starting so yeah there's there's a lot of opportunity um in on the physical side the business side the technology side I mean we haven't even really talked about technology and and that that's also a really interesting part of uh of of the fitness space I think is going to become more and more integral so yeah I mean look we I think we've now got a we've we've now got a really strong platform from which we can we can start to um explore these paths um as a as a as a as a head office we're not burdened by debt you know we're entirely uh funded through through cash so and and you know now that we've got a a strong strong network we've we've got the resources we can start to to uh explore more and more the more and more of these avenues so yeah we we want to remain entrepreneurial we want to continue to test we're not afraid of making mistakes as long as we recognize those mistakes quickly and and and adapt um and um yeah you know mm m meeting more people and kind of growing this movement as time goes on that's that's probably the one thing about this job that I I love the most is you know connecting with people like you who in all honesty you know in my line of work 10 years ago I would have had zero zero chance of uh of of connecting with and um you know uh going down this path together and um and you know getting as many people involved in in wellness and and and health as possible.

Yeah yeah it's such a such a fascinating industry because it's so young and we're just we're just figuring it out you know I mean less than 50 years really in Australia it's probably less than 30 years old right and uh it's it's a it's a cool ride and I I just I I love what you guys are doing you know as um you know everything about it I think as you look you mentioned technology as technology takes a bigger role in in the world of fitness and health um you look at all the ways you know it could possibly be applicable through AI VR AR you know you name it all the I've I've talked about them all and um what's missing in all those components is that community based fitness where people can go somewhere like be with people like not just on your phone on a Skype call but actually be with people touch them smell them right like all these things that happen when you get communities together that I mean if anything you know technology is going to drive things one way and then humanity is going to push things towards the way of F-45 of CrossFit affiliates things like that where it's just community oriented. So I love what you guys are doing man. And I really appreciate coming on sharing a lot of the insights of of how you do things because I think a lot of people find it valuable and uh hopefully get behind it as well.

Awesome. Well uh yeah thank you very much for having me um I very much look forward to the day when we're in the same city uh at the same time we can go and do a workout and grab a beer and uh and you know chew the fat.

Yeah that'll happen. That's happening for sure. Yeah ladies and gentlemen Luke Armstrong from F45. Thanks for having me on. Hey fitness fans don't leave yet it's your host Eric Malzone and I have a quick favor to ask actually three favors. So number one if you're a fan of our show I ask you to do something it takes under three minutes. Go to iTunes please and subscribe to our show. Please please please it means so much to us it's so important and then give us a favorable review. We would really really appreciate it and uh I can tell you how much it means and helps us out. So I know it takes two minutes of your day and uh it means a lot to us. So please do that. Number two, go to our YouTube channel or Fitness Marketing Alliance and uh please subscribe to our YouTube channel there. Number three, if you like this episode or any of the episodes that we've released, share it on social. That's huge. That's a big deal for us and when we put a lot of work into these episodes uh trying to give you great actionable content uh for the fitness industry so that would mean a lot and that's it so we have some big plans coming up for this show. I'll be talking about that in the next couple episodes but thank you so much for listening it means so much and uh if you have any questions please reach out to me. I love to hear from everybody. Eric E R I C at fitnessmarketingalliance com