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- Peloton, the buzzy exercise-bike startup, filed for its IPO on Tuesday.
- Peloton’s IPO documents include a letter from CEO John Foley, who writes that Peloton "sells happiness" at its most basic level.
- Foley’s reasoning is that doing exercise on a Peloton bike releases endorphins, which makes people feel happy.
- The letter downplays the fact that, fundamentally, Peloton sells $2,000 indoor bikes and describes the firm instead as a "global technology platform" and a "media company."
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The the firm revealed spiraling losses of more than $500 million in its results.
Foley writes in his letter to potential investors and Members (or customers) that Peloton doesn’t just sell connected exercise equipment — it sells happiness.
"It is no secret that exercise makes us feel good. It’s simple science: exercising creates endorphins and endorphins make us happy. On the most basic level, Peloton sells happiness," Foley writes.
He goes on to describe how he founded the company in 2012 because he and his wife found it difficult to get to the exercise classes they wanted because they both worked and had two small children at home.
Notably Foley goes to great lengths to describe Peloton as anything but a fitness company. "Peloton is so much more than a Bike — we believe we have the opportunity to create one of the most innovative global technology platforms of our time. It is an opportunity to create one of the most important and influential interactive media companies in the world; a media company that changes lives, inspires greatness, and unites people," he writes.
The language is in keeping with other buzzy US firms that have filed to go public recently and describe their businesses in similarly grandiose terms. WeWork, the office-sharing company, described itself thus in its IPO prospectus recently: "Our mission is to elevate the world’s consciousness.
Here is Foley’s letter in its entirety:
Dear Prospective Investors and Peloton Members,
At Peloton, we believe that better is in all of us.
It is no secret that exercise makes us feel good. It’s simple science: exercising creates endorphins and endorphins make us happy. On the most basic level, Peloton sells happiness. But of course, we do so much more. Our connected fitness experiences make it easy for our Members to get engaging, social, and highly effective workouts with world-class instructors anytime, anywhere. As a result, our Members work out 80% more than non-Peloton Members.(1) And while the health benefits of regular physical fitness are well documented, the Peloton experience transcends health benefits alone. The happiness our Members experience enables each individual to be a better version of themselves, so they go on to inspire others. And that leads us to Peloton’s mission: to better ourselves, inspire each other, and unite the world through fitness.
I founded Peloton in 2012 to solve a challenge in my own life. My wife, Jill, and I knew great fitness experiences made us feel like better versions of ourselves, but there were countless barriers to working out regularly. We loved going to boutique studio fitness classes like cycling, running, boot camp, and yoga. We were addicted to the fast-paced energy, the motivational instructors, the thoughtful programming, and the way exercising with a group pushed us harder. These classes left us feeling energized, refreshed, stronger, and ready to take on anything. However, with demanding jobs and two small children at home, just getting to the gym became harder and harder. Classes with our favorite instructors sold out quickly and were prohibitively expensive. We also had to accommodate someone else’s schedule at someone else’s location. And we were often left without time, without options, and without the feeling of "being our better selves" that we sought.
I figured that there must be a way to make these workouts more convenient, more affordable, and more accessible. There had to be a way to bring fantastic, high-energy, instructor-led group fitness into the home, to be experienced on my time, any time I wanted. And my hunch was that if I could make it possible, others would want it as well.
With that spark of an idea, I looked for brilliant, creative, empathetic, high-integrity partners who shared my ambition and weren’t afraid to tackle complicated business and technology challenges. I was lucky to have several friends who fit the bill in spades: Hisao Kushi, Tom Cortese, Graham Stanton, and Yony Feng. All of my co-founders are still thriving at Peloton, each in a senior role and each an even stronger friend.
To create Peloton, we needed to build what we believed to be the best indoor bike on the market, recruit the best instructors in the world, and engineer a state-of-the-art software platform to tie it all together. Against prevailing conventional wisdom, and despite countless investor conference rooms full of very smart skeptics, we were determined for Peloton to build a vertically integrated platform to deliver a seamless end-to-end experience as physically rewarding and addictive as attending a live, in-studio class. In Peloton’s infancy, our lean founding team operated from a one-room "headquarters" with heavy black curtains that cordoned off a makeshift cycling studio, equipped with a modest six bikes and a used camcorder. We problem-solved our way from streaming live cycling classes to one hundred Members, then to one thousand, and now to over a million Members worldwide. It took a proverbial village to build Peloton, and that once-small village has grown into the community that is now the heart of our brand.
From the very beginning, we have always put our Members first in everything we do, and they never cease to amaze us. Through connecting on the Peloton Bike, Tread, and Digital App, our Members have created one of the most supportive, optimistic, diverse, and inclusive communities in the world. Peloton Members are teachers, professional athletes, active military and veterans, healthcare providers, firefighters, policemen, famous actors and musicians, and even former Presidents. They are teenagers and senior citizens. From diverse life experiences, all gender identities and sexual orientations, countless nationalities and ethnicities. We are proud of our community of Members but even prouder of the way that they have united together in support of each other.
Every day, I receive personal emails from our Members. The most consistent message I receive: "Peloton has changed my life." Astonishingly, four out of five Members were not in the market for fitness equipment before they bought the Bike. They were in the market for improving their lives, just as Jill and I were back in 2012 when we started this company and began this journey.
Seven years later, it is very clear to me that we have an immense opportunity in front of us at Peloton. Peloton is so much more than a Bike — we believe we have the opportunity to create one of the most innovative global technology platforms of our time. It is an opportunity to create one of the most important and influential interactive media companies in the world; a media company that changes lives, inspires greatness, and unites people. And it is an opportunity to create one of the best places to work in the cities where we operate — we prioritize culture as much as any other business objective.
And to be sure, we are not taking these opportunities lightly. William Lynch, our President; Jill Woodworth, our Chief Financial Officer; Kevin Cornils, our Managing Director of International; my co-founders; and our extended senior leadership team: all of us feel an immense responsibility to deliver on these opportunities, and we are ready. We have worked our entire careers for this very moment.
Speaking for the entire Peloton team, we are incredibly grateful for all of our Members from all different backgrounds who love Peloton and have welcomed us into their lives over the past several years. We are truly humbled by your passion for our shared mission.
Today, however, we look forward. At this important moment in our journey, I am honored to invite you to join Peloton.
Founder and CEO
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