Tom Dowd - The Future of F45

It's great to have you on. You know, I've uh been a fan of F-45 for quite some time, I think since 2018-2019, when I got to do a little bit of side work for you guys as a company and um been following it ever since. And obviously you taking over uh gosh, it was March, so um Q won this year, and we're we're now in Q3. Um, you know, there's a lot going on in your world. I think you got a lot to uh to say and talk about.

Yeah, well, thanks for having me. And you know, I've been an investor for about four and a half years with Mark Wahlberg and I. We first took the meeting uh in the back room of the Ellen show, believe it or not. And Mark was filming, and you know, I I you know, of course, did my diligence as I always do before the meeting. And um, you know, I I loved the concept so much doing my due diligence, and then the meeting, I was very excited, and I actually went out and waited for Mark to come and told him I wanted to have the meeting all over again with him hearing it firsthand. You know, kind of wanted to just get going. But we had the meeting and we both jumped in the car and said, you know, we just we just love this uh this culture, we love the workout, you know, we'd love to be involved. And you know, about two to three weeks later, we've pretty much gotten a deal. We put 110 million in with our group. Um and uh the F-45 team at the time took a 200 million dollar haircut from another group to work with us. And um, yeah, it's been a it's it's been a bumpy road. Obviously, COVID threw a monkey wrench into everything. You know, we're also invested in the restaurant business, so yeah, that didn't feel great being in restaurant business and gym business during COVID, but you know, um we've come out of it. You know, we're we're we're just loving the trajectory that we're on now with uh with the gym business with F-45. And um, you know, listen, we we invested and we partnered and I met with the folks uh who have been putting money in as well, Kennedy Lewis down in Florida right in the beginning of March, end of February, I believe. And um they convinced me that you know, stay with this and and you know, help work through the unprofessional management, I guess is the best way to phrase it. Um and you know, I had no intention of being on the front lines, but after meeting with the folks there and and the chairman of the board, um, I was convinced that these folks were dead serious about you know fixing it and staying committed to it. So I was just in it, you know, as Mark's business guy, uh Wahlberg's business guy, to just help protect our investment and do what we can through my Rolodex and get people, you know, the right people in the door. So we worked through some some CEO candidates for CEO, and um, when the last one pivoted out to something different at the last minute, um I kind of got caught flat footed and ended up saying yes. Um you know, you know, I certainly wasn't looking to do it. But you know, actually, you know, uh for me part of it was you know redemption, you know, safe face with the investor group. Actually, me getting right into it, you know, and going, you know, taking over as CEO, you know, you know, was was part ego because I knew that this was all self-inflicted wounds. I knew the professional management and getting the right people and organium the people that are here focused and and with good sound leadership, ethical leadership, uh, that this company could get back, you know, and and very profitable and cranking along. So uh yeah, so that's how I ended up saying yes. You know, nine no's and one yes got me here. Um, you know, but you know, at the end of the day, something in the back of my head, you know, fantasized about taking over when I was frustrated for four years with what seeing what was going on. Um, so that's what I you know said I would do it. And you know, I had some regret the first week because you know, throwing into the fire and seeing all the problems that we had. But at the end of the day, everything is very fixable, and that's what I preach to the team. You know, we're you know, that's what you get paid to do is fix problems. You know, so my 25 years of GNC was sitting in an office and people rotating in all day with their problems. So, you know, everything can be fixed. And you know, the good thing is we're in a high growth category with an amazing concept, and really we have some amazing people that have you know stuck around with us and they're they're very committed. Um, their energy levels are through the roof, and we're we have a clear vision, so it's a it's a great place to be. So we love the health and wellness space. You know, we've been in there with the sports nutrition business with performance inspired nutrition. Uh Mark and I started that company, so um, you know, we've stayed close to it, obviously. Coming out of GNC for 25 years, you know, as a number two guy there. I ran all stores, operations, new product development. You know, you name it pretty much reported to me, except for like legal and transportation. So I you know really cut my teeth, um, you know, and stayed close to the industry.

So the this space was you know very organic to me stepping in.

Yeah. Yeah, it's it's interesting. And I I you you answered a lot of questions I have, so there's gonna be stuff I definitely want to circle back on. The um you know, your background specifically. I mean, 25 years at GNC, right? I mean you held maybe you know, expand on that a little bit. That that's a lot of time to spend in a company. Um, I'm sure there's a lot of roles. You know, how what was some of your what was your trajectory like? Where would you start and where would you end up?

Yeah, I started as a district manager with about 63 locations. Um I was hired, I'm from upstate New York, Orange County, um, and they hired me for New York market, and then all of a sudden they said, Oh, listen, you know, we need to send you to Pennsylvania. Um, you know, the CEO dropped into his old market and the stores were a disaster, so we're sending you there. I said, Whoa, I'm not going there. I wasn't hired for there. And they said, Well, we don't know if we can keep you on if you don't take this position. So guess what? I ended up in Pennsylvania, so I moved down to Reading, Pennsylvania area. And you know, it was much different. I grew up in a supermarket business. My father owned supermarkets. Um, you know, so uh, you know, when there's a problem in a supermarket, you go downstairs or you walk across a couple aisles and you can go fix it. Um, you know, when you have 60 plus locations and you're driving around, you know, when problems happen, you know, it's a three, four-hour drive. So it was it was a tough situation for me to adjust to. But, you know, I did well. Um, and then I, you know, started working my way up the ladder. Basically, I'm the only executive that ran every division through the company. So uh taking over as you know, merchandise manager and and then you know, divisional vice presidents out in California out in California. And these are big markets, you know. So for division three, for example, California, I ran everything from um Alaska down through Texas and everything in between. So for me being an East Coast guy, you know, it was a it was a great experience to see that market. And that was a big, big market that was underperforming. And we turned that a mark mark, we turned that around in probably two months to become the number one division. So again, that put me on a map, and then I got sent overseas before that even I should back up a little bit uh to do acquisitions for health and diet centers in the UK for GNC because I got handpicked by the CEO because of my you know aggression level as they term it, you know, just very get things done mentality and just that New York mentality coupled with my my very type A behavior. You know, so you know, I went over there and spent literally almost two months over there, um, and went back after that to help supervise that. So that was a big success for us. And then I got started being used for more you know projects like that, and so that helped you know put me on the path. And then I was actually going to leave, and the president of the company came and told me that I would be an idiot to leave, um, stick around, and that was for Kadiva Chocolate Company. So I'd probably be 400 pounds if I took that job. So I'm glad it is. So stuck around at GNC and you know survived three leverage buyouts, which is tough. You know, most people can't say they survived one. You know, these companies buy you and spend a lot of money and tell you, listen, we're buying you. Um and then they pretty much start to try and figure out how to get rid of you, um, you know, and try and replace you with their people sometimes, you know. So, you know, just surviving that. And of course, you know, the expectations are high. So you have to deliver. So, you know, every leverage buyout is a boot camp. You know, we were owned by a Dutch company which is very similar. They thought they could just do everything they do there, you know, Royal Numiko and do it, you know, at GNC, and that didn't work out well. But you know, that was a that was a real pressure test as well. Um, so it survived that. And then I left for two years when a Dutch company owned us, and I got recruited back to come back to sell the company uh because everything was a mess, um, as I predicted. Reason I left, and I was actually manufacturing supplements for um websites, so back-end website stuff, diet pills, herbal Viagras, you name it. I was making it and it was a great business work, living on a lake, loving life, working in shorts every day. Um, but again, very similar situation. I got a call from the CEO and his president, and I called back back in the day when they actually had answering machines. They left a message, and my wife said, Go get the machine. So I listened to it, called them back, and they just happened to be in the office, you know, and they kind of tag team me and said, you know, you need to get back, we'll make it worth your while. We need the Dutch to try and dump us. We, you know, the field's a mess, nobody knows what's going on, and you know, you're the only guy that could do it. Flattered, uh, but still had no intention of doing it. And then at the last minute, something made me say yes, and I hung, and just like good salesmen should do, they hung up on me pretty fast when I said yes. And that was a Thursday, and Sunday I was on a plane, and Monday I was back at GNC. My wife cried when I told her, I thought I was insane. Um, but you know, that's really was one of my best moves ever because that made me a rich guy because we survived and turned it around and had a great run from there. So um, you know, it was one of my more challenging decisions, and it's very similar to this decision, you know. Wasn't wasn't looking for a job, didn't want to get on the front lines, and I did, but I know that this has as much, if not more, potential. So that part of my brain again said say yes, and I did. So here we are.

Yeah, it's it's I I I pulled two things away from that. Well, many things, but two of note. Uh number one is you're battle tested, right? You've you've you've been you've been in there in the field.

Yeah.

Maybe uh I don't know. Yeah.

And you seem to uh gravitate towards a challenge, right? Um something innately in you seems to to draw you to that.

Yeah, my wife says I'm not happy unless I'm unhappy and fighting and trying to prove something. So I don't know where that comes from. But you know, I guess working for my father, who's a tough, you know, I mean, literally just push me harder than anybody, you know, instilled that in me and working for a family business. So yeah, something always out there driving me, and I'm always, you know, you know, even like you know, working with Mark Wahlberg and being his business guy, CEO for everything outside TVs and movies and all the deals we get into. You know, I always like to to keep it going. I just can't be still and you know, golf and just you know, that's you know, I'm just a business guy. I love business, I'm not a sports guy. I I play golf, but I don't follow sports really. You know, it's all business for me. And I just it's it's my hobby. So doing it and getting paid for it and making money on my investments is is really plays in beautifully to just the way I'm built. And you know, I'm built to be a retailer, wholesaler, sales guy just for my upbringing.

Love it, love it. You know, I want to uh I mean a lot of this I really for our conversation today, Tom, I want to focus on the future of F-45, what the vision is, where do you see it going forward? I mean there, you know, my ballman, I think if you look at it from the outside, it's a lot of uh innovation, right? Uh F-45 has been known for innovation. Um before we get into that, I kind of have to uh like you know, before you stepped in, you know, what what exactly in in your mind, um, what do you think happened right with F-45? How did things get a little sideways? And then, you know, what what what can we learn from that as an industry?

Yeah, well, listen, it's not that complicated, it's not a hard business, quite frankly. It's a it's a it's a franchise model, which you know, like at GNC, we had a split model, which is much more difficult. We had a big third-party partner with Red A. Um, we had a store within a store, so we had a lot of moving parts. Yeah, you have you know 8,000 SKUs, all dated, you know, regulatory issues. We're I think you know, at that time we're in about 65 countries, so every country has its own regulatory issues. Um, you have corporate employees, you know. I think we had 22,000 corporate employees at one point. You know, we actually owned our trucking business. So a lot of moving parts. You know, this business, you know, quite frankly, is not that complicated. There's not a lot of layers. Um, you know, it's all selling and marketing and just SGNA management. And quite frankly, you know, the simple answer to your question is this company was just focused on selling and not supporting. They weren't focused on, you know, just the uh standing operating procedures on how to run a good business. Um I've never seen a company that just really didn't even review PLs, you know, by you know, they didn't hold business reviews, you know, as everything was just kind of you know, cowboys out there running around just trying to sell franchises and not really focused on how to manage that process to be profitable. Um so you know, I'm a very subservient leader as far as you know, I tell everybody, which is how I think, you know, I work for the franchisees and I work for the employees. My job for the franchisees is to make them more profitable and and you know, get them to grow more because they're making money and doing well, because that means that we do well. And that logic alone, as simple as it sounds, just wasn't resonating here. It was not a part of the culture. And then my job for the employees is just simply to help them do their job better, you know, expedite and help them execute and and push where needed, um, but really guide. You know, if you know my mentality is if I have to push you, I don't really need you. I need people I need to guide who want to go after it. And I think I know we're there now with the team that we have. And quite frankly, they've been frustrated as well because they've seen just the Yahoo Cowboy mentality and how they were doing things in the past. Um, you know, so they actually welcome structure and they welcome you know clear direction and being able to make decisions, you know, instead of, you know, I mean, you know, I've dealt with them on as an investor, and you know, it's just been frustrating the lack of ability to just execute, you know. So just being able to be decisive is is critical to any business, right? And listen, even if being decisive, I read multiple times over the years, you know, is almost more important than being right all the time. So in other words, if you can make decisions and and be right, call it 95% of the time. That decisiveness is gets you much further down the road than never being able to make a decision on time or hold things up and create frustration and big gaps in in time. So um I've always been decisive. It's just in my nature. And, you know, again, you know, I I've got my whole career has been about managing big organizations, much bigger than this one, quite frankly. And and you know, so it's it's just been good, good, easy, you know, one-on-one stuff for me for the most part. Of course, we have our different nuances here. Um, and you know, it's just been really a mess in many regards, but it's been a mess. It's easy to clean up and get back on track because again, this has been a slow motion train wreck for you know a little bit here. So getting everything back on track, no pun intended, um, isn't that hard when you know how to do it. So, you know, and providing that guide. So it's been I'm actually at the point now. I started officially from a consultant to um you know the CEO uh April 1st, I believe, April Fool's Day. Um, you know, that's it's it's um you know, it's it's it's it's more it's getting fun now because you know I love I'm I'm a growth CEO and growth executive. You know, I love the go-go days, but you know, and I've been through the downturns, you know, and we buy companies you know that are not doing great, which is how we make money. You know, I'm investing in different funds that buy things. Um, you know, we fund with Kano's Capital, we have Nutra System and Eugenics, for example, and then the Serena Williams fund. You know, so you're always looking for deals you know that are you know underperforming so you can add your value, and then that's where you make your money. It's that simple. So, same logic here. You know, we're not used to riding it all the way up, then down. You know, usually we step in when we're down, but you know, we're here now and we've been here, so now we're just gonna keep you know doing what we need to do to get this um back on track. And then you know, really we're we're seeing traction literally every day now. So I couldn't be more excited about the direction. And then we have our two new concepts with the Pilates, we're very excited about with FSA than Vibe. So that's a great category for us, and then I'm also talking about some adding some other concepts next year. So a lot of good stuff. Um, you know, it's it helps that we're in a great industry, a high growth category industry, so that always helps. So, you know, now it just comes down to execution. You know, we know how to execute.

Yeah, I love it. And I I I love uh the FSA and the Vi, I was I was talking to some of your team members about those concepts, and I I really like them uh quite a bit. And I think you know, Pilates is really hot right now. I can't quite explain it. But when you look at um the decision, I don't know if you're around, if you played any role, but the decision to go public, what what are your insights on that? What do you think drove that decision?

Oh, I know what drove it. Everybody wanted to you know take advantage of the growth potential and um make money. And you know, we put a lot of money into it, so I wasn't opposed to it. Um I had some problems with you know the management, you know, at the time because being a public company um is a much different ball game. I mean, you you know the management, the professionalism, you know, everything you say and do is is under the microscope. And that's one of the reasons people go private, right? Is because you know when you need to fix things, um, you know, you don't want to be in a public space, you know, but you know, but you know, at the end of the day, we we we thought it would work, obviously. Um you know, the stock price has been you know a sore point and you know for us. And as investors, it's not a great place to be, you know, for us. But we know that um, you know, they wanted to get the money out and and see what they can raise. And um, yeah, we I think we got to 1.4 billion, you know, market cap, you know, which validates you know the company. Um but you know, they went public, you know, and um there's a lot of little nuances there I probably can't even get into, but you know, it is what it is.

And uh I mean it's in the news now, but um the the decision to delist, can you for those I guess let me ask you this in this way, is you know, for those of us in the fitness industry who may not realize or may not quite fully understand what delisting is, can you explain it and what what drove that decision as well?

Yeah, I mean we we went we were voluntarily trying to delist, and then because we went under, you know, I think 50 cents, there we're just being forced to delist, which is what we were doing anyway, which is just a process to potentially go private. So um that's that's the goal. And um, you know, it's just much it's much more cost effective, number one, to be private, and it's much more um you have a lot more time to spend on the business when you're not a public company, especially for uh the CFO and CEO, uh, because you know we'd have to spend a lot more time dealing with public markets, um, and we'd rather be spending our time you know getting the business back on track and fixed and doing the things that we know will add value to the company to go back out public at some point or you know, sell to a strategic or you know, with another VC group, whatever. But you know, being a public company, you know, we'll listen, we don't buy public companies.

Um, you know, we we just we'd rather you know deal with the the the operation as a private company for a lot of reasons, especially saving the amount of money that we're gonna save, which people don't realize is very costly to be a public company.

Sure. You know, um I want to get your insights on this. I mean, IPOs within our industry um are rare, right, within the fitness industry. Uh you know, why um and why do you think that is? Like what do you is it because the industry is young? Uh because we just maybe don't have companies that are ready for it yet or leadership that's ready for it yet? Like what what do you think of it?

Well I was the guess. I mean not an expert, you know, but you know, being a public company is a pay in the S. So I mean, you know, being being, you know, if you're growing and you're and you're doing well from a capital standpoint and you know you're making decisions that are good for the business for the long term and you're not necessarily doing things that are good for the short term on paper, you know, that's much easier to do as a private company. Because a lot of times, you know, entrepreneurs, co-founders want to do things that they know will pay off that you know they don't want to have to explain it to a public market. And you know it's it's just you can move a lot faster and be a lot more nimble being a private company. And you know you don't have all the you know the investor issues that you have being a public company. So that's probably the reason. And you know again it's a high growth market so you know a lot of times you're putting money in places that may not instantly pay off but you know it's going to pay off down the road so you do it.

And when you're private it's much easier to make those decisions and you just have to answer to your investors and your management team. But you know it just really enables you to do more than that.

What what does that look like for a 45? Like you know right now what's your primary focus what do you think your focus will be next year I mean you're bringing out new brands um you know you're you're getting new uh franchisees excited and supported like what what is what is the vision that you're seeing right now yeah listen it's we have a great concept we know that we have three great concepts so we're excited about that so how do we maximize that and really get you know get our feet under us again um get our franchisees absolutely thrilled with the leadership team uh you know we've opened up the doors with communication I mean I spend literally hours a day between email LinkedIn social media just responding to franchisees because they've been almost like neglected children.

So you know these folks are out there and like to to have engagement with people that really care about how they're doing and want to help them do better is going to get us pretty far with them because you know again the the logic is they need to do well for us to do well. So we're really putting our back into helping them be profitable, successful growing and I think there's easily 10% plus growth within our existing network just when they feel like okay we're here to stay we're committed to them and that's why I didn't take the the interim you know title you know you know because at first I was like well I'll do it for a year or six months whatever. And now I'm like you know what it's it's better for the organization to have stability and just people that are here long term like them. The fact that I'm also investor with my own personal money into this and and represent and put in the group and actually started the investor group the original one with Mark you know I think gives me some credibility because I'm in it with them to a point you know and now that I'm putting sweat equity into it that adds you know more horsepower to my story for them and and really you know um for me I'm sincere about my caring for them to do well because um you know I I grew up in a family business you know I've worked with franchisees at GNC you know my whole career I understand that you know that their um ability to do well could be the difference between paying their mortgage um or not paying their mortgage so I take that very seriously um you know my father's businesses did very well for a long long time um and then they did when competition moved in you know um you know so I I've I've seen that firsthand and I understand you know the pain of that and how it changed my life trajectory. You know I thought I'd be the king of New York supermarkets by now. So you know uh and you know listen everything happens for a reason. I was supposed to be a state trooper that didn't work out I was brokenhearted. You know but listen I've done okay so everything happens for a reason. I believe in fate you know me and the guys from Candy Lewis on a trip with with Wahlberg from he was filming in Atlanta down to Palm Beach. You know if I didn't go on that trip I wouldn't be here today. But I've always believed in fate and I think you know you get put on a course and um you know I'm I'm I'm really happy I'm here now you know again being able to do what I knew all along could have been done and should have been done gives me a lot of pride and and seeing the team bond and grow and and really you know respond well and even the franchise operators um that's really fulfilling for me and it gives gives me a lot of um energy every day to really come in here and and and kick ass and really you know get everybody excited about the future.

Where do you think uh your franchises need the most help? I mean there there's real estate can be challenging right the um staffing and finding talent acquisition can be challenging. You know there's a lot of challenges out there. I mean you're right it's not a complicated business. It's really not right especially with the models that you guys have. It's like it's a group class model it's low staff for the most part um you know the the the footprints aren't that big. So where where do you think they need the most help and what are you guys focusing on first?

Yeah I think you know probably in my mind um guerrilla marketing and marketing in general I think you you see we have some great examples of of operators who are you know owner operators like they're in their studios. They have multiple studios they're but they're engaged in each one of them or single unit operators but they're on top of their business. You know we see some great examples of franchisees that really know how to market their studio and engage with their with their members and also hire great trainers and make sure that they have the best talent. And then like any business in corporate or franchise you know you have you know operators who just aren't on top of their business as much and don't have you know have it figured out from a marketing standpoint, don't put the effort into it and don't test things and they're not involved in the community. So I think bringing the the the lower and middle buckets up in in and communicating and sharing and training and and motivating them to to do the things that we know are best practices and that actually work and and showing them here's examples of what works and here's what's doing it. And then from a corporate responsibility standpoint you know really cleaning up our marketing messaging I I I I know that we've made you know a world of difference in marketing a short period of time. Really proud of the team creating great content we're becoming more engaging with our members we're collecting email addresses we're providing you know newsletters and we're taking a position of being the authority in health and wellness you know starting with the gym experience and then how do we create more of a sticky environment and how do we help our franchisees have more content that we're providing to help showcase what an amazing workout F-45 is and the community how amazing the community is one of the first things I fell in love with I I thought it was just incredible that people take photos in front of our signs like they do with Disney, right? You know, or in Apple. So I just you know it's when you have that kind of commitment and community um you know how do we build that and really um take advantage of it quite frankly to to build more people into the system and get the word out but you know and then again you know doing the things like staying in stock on on apparel you know the simple things we're we're gonna fix and create more revenue streams for our franchisees with the sports nutrition products apparel other deals that we're working on you know we need to create more revenue streams for them which will be an easy organic move for us. And you know you look at other competitors and you know bringing my retail experience to the party we're gonna give them a lot more opportunity to do well. And then we're gonna have to do more things that are just basic stuff like stepping in early on and making sure that you know we we have a real estate strategy which we've locked in already which we're not oversaturating and we're not being just greedy and saying sell, sell. Now you know, because my mentality marching orders to the team is uh two things. Number one, you know I I'm okay to shrink to grow. So you know if we need to lose unproductive you know problematic locations to add more value to the existing locations I'm fine with that. And then moving forward you know we have more parameters around properly opening studios both from training the setup to ensure that we have the the demo profiles locked in and you know the the the amount of uh you know uh population around each studio so we're gonna be very tactical and smart about you know growth and and how we move forward we're not just gonna sell and forget you know and then the other thing we need to do is spend a lot more time you know we're we're gonna hire about you know call it 10 new um on-screen trainers and and out in the field trainers so they're gonna be a lot more feet in the studios you know looking at what's going on working with the studios spending more time with the trainers um because really the trainers are the backbone of the organization right so those trainers have to be good and when you have great trainers it makes a world of difference the members you know uh respond um and the workouts are better and you know they're just not you know there to yell out yeah you have five seconds left to actually tweaking and helping supporting and high energy and that's really where the magic is for us um so we're gonna really put our back into how do we create more um field support people um and how do we create them or just hiring of them and sending them out and then really going after that whole um training element of the business and then we have sign kits and we're doing more things to take advantage of our our branding because F-45 is very well known in in Australia and New Zealand for example but still here in the US we have some brand identity um issues that we have to keep building on and part of that is the marketing and part of that is our signage and window signs and things like that that we're rolling out now you know and you know we don't even take advantage enough like in our studios to showcase Mark Wahlberg. You know we'd have to pay a lot of money to have Mark you know in our windows and he's a big investor and believer and loves the brand so you know we're gonna get some signs up and we're actually going to tell people who we are in our sign in our sign kit as well. So when you see our our studio and maybe we're not open for a class um you know you'll be able to at least see something that tells you who we are because unfortunately one of my first arguments with old manager was F-45 by itself doesn't mean a lot to most people. So you know I want to you know always include training and start telling our story you know every opportunity we have yeah I love it.

And let's let's get into the product innovation.

I mean we we we've talked about a couple times here but uh FSA uh vibe am I saying that right yeah we're working on a name for the US because we can't use it here vibe but that's what's in Australia now in New Zealand but uh we're we're getting close to a to a good name it's tough to find a name that's not used um that's meaningful so we're getting close though but for now it's a good working name and and what what's different about those concepts for those that don't know in the traditional F-45. Yeah so it's it's PLODIS based so vibe is a high energy think of it as like a spin class you know neon lights mirrors on a ceiling great music high energy you know go go go amazing workout you know it's just the concept's killing it um you know we have a number one location in Singapore um and just big growth potential we pay a lot of money for it out of Australia and then you know the lack of execution um again came up and just we bought it and kind of let it sit there and just kind of half-assed it if you will um with with how to roll it out and execute so I'm really focused on blowing up both these concepts because as you said earlier Pilates is red hot we have two great concepts and FS8 um is extraordinary workout you know it's Pilates it's toning it's yoga all combined um so it's just fantastic workout we just tweaked the workout again we're internally we're calling it 2.0 um and we're working on keeping um everybody in one station on their reformer and a mat next to them rather than coming off the reformer going back to the class so it's the and we've tweaked the workout and tested it and it's through the roof as far as how everybody's responding to it. So we have two very unique different workouts in the same um category the Pilates concept but um you know think of Vibe as more like Miami New York you know high-end energy you know really trendy hot brands and FSA could fit in there as well obviously but also um you know in Kansas City you can put FSA you know in Pittsburgh you know very easily you know and or you could have both concepts in the same cities because it's a different experience. So it's uh it's very I'm um I I believe in in three to five years we could have more FS8s and fives than F-45 in total. You know at least they're both gonna all three of them are going to grow uh you know but I'm very excited about it and I I just people love the the workout so that's that's amazing to have that gold mine that we're sitting on that now we just have to you know start getting them out there and already we're opening we'll we're gonna open up a vibe which will be under a different name in in um in New York and Manhattan so I'm very excited about that because that's the perfect you know venue for us to showcase this amazing concept um and that'll be kind of where we take people through and you know because we're in almost 70 countries you know that that's you know New York is very visible obviously so that'll be like our showcase to that in Singapore to show people how amazing vibe is and FSA you know um we have about you know 43 locations now um you know we're we're turning that around and we already have a waiting list if people want to open up those locations so pretty excited about both of them you know and then you know the the big vision is to have you know two concepts together with the retail store in the middle so think of F-45 on one side and a uh FSA to vibe on the other side you walk in and that way there's always activity going it's always you know you know people there and and then we have deals if you belong to both like we're going to do in our HQ um you know studios you'll have um you'll have a pass to do both you know at a different rate um so if you you know you want to do Pilates one day great you want to do you know the F-45 it's right next door so that's uh going to give us better efficiencies with our real estate um it gives us better marketing horsepower um and really creates more of a hub um that's gonna be very exciting right on you know for your for your traditional F-45s Tom where um globally like where are you seeing the most traction?

I don't necessarily mean in like you can touch on like unit sales but um you know like the health of the franchises like where where is it being done the best?

Yeah I you know listen uh Australia is an older market more mature which has its own little you know nuances that you have to deal with but that doesn't mean it's you still can't grow and do very well there. So um we're just kind of spent some high um energy setting a team down there right kind of like in February March for about four months we had a group of people down there. We spent a lot of money on marketing down there. So you know the whole APAC market we need to continue to focus on and grow. So we're you know kind of you know it's kind of amazing it's an Australian based company and everybody just moved here and kind of you know turned their back on Australia a bit so you know that's what we're we're countering. You know just blew my mind didn't make any sense obviously you know to do that. But you know every again we're fixing it we're committed to the whole company we're committed to um supporting each country if we're going to go into a country we have to have the support you know elements built around it you know from translating to just having people that can go visit the markets you know you need to inspect what you expect. So we need to have that mentality. But you know the growth you know the greenfield opportunities clearly you know in Asia we see huge growth opportunities places like even Switzerland you know you know when you look at the statistics of gym membership believe it or not Switzerland's number two I believe you know it's right up there in the top three at least um so yeah we have a lot of opportunity in other you know in every country especially now we have three great concepts but again uh you know North America is a big greenfield opportunity for us just because of the population and the lack of density that we have for for our studios and even in the you know the markets where we're pretty dense with F-45 now we have our pilot concepts that we can roll in and a lot of the operators will now want to have another opportunity for revenue stream with those concepts you know and unfortunately now with with what happened with COVID you know construction costs are still um high but they're coming down so we're helping them manage that and then we're scrubbing everything with our RPs for everything we touch um that provide to the franchise group to get them better costs on everything. So we're really working to get their ROI you know back to them faster by giving them a better you know footprint and model to work with and again giving them more revenue streams to work with as well.

Yeah um as I want to make sure we respect your time I do have kind of some more fun questions for you I guess for lack of a better term but what's it like to work with Mark Wahberg? I mean is he is the is he the guy from TED 2 or is he more serious and business like I mean I know his work hour team is ridiculous. The guy's up at like three or four in the morning right I mean at least that's you know the the story that's told everywhere in the world about Mark Wahlberg but you've worked with him a long time.

What's the guy like yeah listen I wouldn't be working with him probably 13 years and you know when I left GNC he pushed me to leave to kind of work with him and to vet all his business stuff and you know investments and things like that. And you know I've been working with venture capital and private equity groups you know um and Mark's you know very serious dude man he he everything he's he just is so hardworking and so committed to everything it's it's it's a new level. He's busy all the time he he's never rests his workout commitment's been you know obviously famous in his schedule when he's working on movies you know he is um he he's his commitment to like when he's you know says he's going to do something he walks through walls and people to get it done. And that's my mentality. So it's a great fit for us to be very strong willed and then motivated and just uh you know don't take no for an answer and make it happen. So it's been great. You know we started performance inspired nutrition together you know uh that was our first project and it took off you know it it started off as maybe almost I don't want to say a hobby but it started off as something to give back to charity and you know to sort very organic so we can draw the quality of the supplements and for you know him and you know all of our professional athlete partners and things like that. But you know uh Drama Green's a partner for example and you know Adrice and D. Chapeau as a partner. But you know we wanted something that we knew is was natural and efficacious. So um but you know his standards are high. You know he's you know I've been grew up in the business as you know but you know he tastes everything and you know he demands to try everything. We have to you know I probably have $10,000 in FedEx bills just FedExing everything to him to try you know we're coming out with new products all the time. But you know he's very serious but he's also a great guy. I mean he's you know he's he's just like most people he's he's he's you know serious when he has to be serious and he's he's dead serious when he's serious and he's also you know you know fun guy he's just very genuine you know and he's um he's a good friend and he's a good business partner because he um he really um is a guy you can trust and he's a guy that you know he says he's gonna do something with you it's done.

Yeah I love it. You know what's something that you brought up earlier too and I I've heard it from people that work with you is uh the concept of servant leadership is really important to you.

Um you know what exactly does that mean to you and how did how does that actually play out on a day to day yeah I mean you know it it's just my mentality of I understand my role in the world is just to not you know I don't have an ego. Like I've listened I've had a great career you know I've done very well and I'm and I also I always feel very um you know Humbled by it. I think, you know, listen, I know I I bust my ass. I know I work harder, most people. You know, my whole world is, you know, I'm always engaged. Like I'm I'm on social media, I'm commenting on things. And my you know, my relaxing time at home is with my iPad, reading emails and responding to social media and things like that. You know, it's my iPad, my phone, and my remote next to me at all times, and my iPad's never off my lap, as my wife always says. You know, but that's my that's what I like to do. You know, I mean I do other stuff, obviously, but I'm talking about just generally any night I'm home. Um, you know, so my my subservient behavior is based on the simple thought that I feel lucky to have the opportunities I have and meet the people I I meet and work with. And I think that translates over to people that they understand that, you know, listen, I'm pretty jaded too. Like I met a lot of great people, partners of amazing people like Mark. Um, I feel you know, for me, it's you know, it's all about the person, you know, it's all about the opportunity. If the person is a quality person, I could care less. You know, if the business isn't right for us, we say no. Um, but when the business is right for us, like we're all in. You know, it's there's just no gray area, like it's all in or not. And people die trying, and I tell the team, like, F-45's easy, we're not gonna fail. We don't fail. Um, and it's not that we're not trying to fix Blockbuster. You know, um, this is why we're here, this is why we put real money into it. Um, this is you know, that we can do better than the competition. Um, we can get anything fixed, and we can get you know everything done that we want to get done. It just takes you know the right people and the right strategy in which we have. Um so it's it's it's done all the time. That's how people make money. It's just sticking through the bad times. You know, listen, it's it's easy to be a great captain when the Caesar calm. You know, you know, it's when things are tough and you're transitioning and working through uh those are the people that when the Caesar calm again, those are the people that enjoy the benefits of you know riding it out and stick and putting their you know their commitment to what they believe in. Uh, because it's easy to jump ship. You know, listen, you know, I'd I'd be working in a cube somewhere if I if I didn't do the things that I knew were tough to do and suck it up and you know, you know, like I mentioned, venture capital buys a company and you know, you're put through boot camp every single time. You know, a lot of people left. And guess what? I'm only one of two executives that survived the leverage buyouts at the end of the day, myself and the CEO. Um, and we made a lot of money because you know we stuck it out and we did what it took to to win, and we provided a lot of value. And that's what I always stress to everybody. You know, hanging on is one thing, but you have to hang on and add value, otherwise, you know, you're not going to survive. You know, you have to think about how do I constantly add value. And that's the way I think. So I'm subservient because my people need to do well for me to do well, the franchisees need to do well for me to do well, and for the company to do well. So it's it's that simple. Um, and you know, my ego doesn't come into play if I have an idea and somebody can be, you know, a member, a random email or something I see on Reddit, and like I'm happy to back off my thought and idea and say, you know what, that makes a lot more sense. So I mean being subservient also means not having an ego that drives bad decisions. And you know, I'm famous for being very direct um about my thoughts and speaking up, but I'm also quick to say, you know what, maybe I'm off on this. You know, I'm happy to listen to your suggestions or and read what the polls say um or whatever we're looking at, you know. So um I think it all comes into play. Um, but you know, at the end of the day, everything I do is driven to make everybody uh more successful, and that's really how it's played out for me in my whole career.

Awesome. Awesome. Last question for you. And I uh always ask this in the spirit of collaboration, but you know, how as an industry, uh what do you need right now? How can we help you? What's uh if you want people, you know, if people are going to reach out, what's a good reason for them to reach out to you?

Yeah, thanks for that. Um listen, you know, we're we're we're looking to open up a lot more studios. We have a lot of growth potential. Um, you know, um we're looking for people that you know it can also come in and help us with our trainer initiative now to add more field ops people. So if anybody's out there looking to come in uh with you know, really what's uh I consider you know a very lucky opportunity to get in as we for this. I I even hate saying turnaround because the core business is so great. HQ is just really screwed up, but we're fixing that. But you know, if anybody can come in and add value to the things that we're looking for, which is our which is our field support people and trainers, uh we're we're starving for more Pilates trainers. Um, you know, so that's another big um area of growth for us, obviously. And then even internationally, if we have some people that want to be on the ops team internationally, um, you know, we're we're open to that as well. So we're actually adding people and looking for good people with this. Um, you know, but again, everything is going to be um much more balanced for the size of our company, you know, the days of shooting from the hip and overhiring and overpaying and just going crazy with everything are over. Um it's a much more professionally run company, which should give solace to anybody coming on board because now they know that there's there's there's responsible people, you know, real adults running the business now who are very responsible and very you know knowledgeable about how important it is to be a successfully run company for everybody's benefit because um we have we're sitting on goldmine here, we just need to continue to um execute, execute, execute right on.

Well, Tom, thank you. Thank you for joining me today. Um really appreciate your insights and and you know, I and your time. And most importantly, I I appreciate your transparency. I think that's you know a critical um characteristic of good leadership is like, hey, let's just call it what it is, get agree that that's what it is and move forward, right? Um and that's uh that's a key quality. So I I do appreciate that. And if people want to um get a holder view, or if you want them to go specifically somewhere online, uh is there anywhere you'd like to direct them?

Yeah, I'm on Instagram, big deal doubt, and Instagram, you know, an old nickname from when I was a teenager, and um, you know, just follow our our all F45 and I'm on LinkedIn, Tom Dowd. And um, yeah, just you know, listen, follow what we're doing, follow Mark Wahlberg on Instagram and you know, in the you know, even if I have any FSA pages, and you know, just um reach out. You know, I try I'm you know inundated with every day. You know, it's still we're still you know trudging through the weeds here, but you know, again, like I said, every day we're making progress. But you know, love to hear from everybody, love to hear your comments, and um you know, I appreciate your time and for having me on.

Yeah, yeah, it's been great. And uh last thing is uh thank you to Corey Angelin for getting us connected and and making this interview happen. So appreciate you, Corey. And uh that is a wrap, ladies and gentlemen. Calm down.

Thank you.

I hope you enjoyed this one.