John Foley & $8 Billion Peloton

The at-home-studio workout

Robert Lee
May 28 · 5 min read
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Source: Peloton

This gave Foley the idea to bring the studio to the living room for those who didn’t have time to go to the gym.

Foley, who attended Harvard Business School in his first round of investment raised $350,000 from a dozen Angel Investors from his extensive network. He then added another $50,000 of his own money and then got to work on Peloton.

Peloton’s target audience are ‘the money suburbanites of the world’.

Peloton disclosed overall sales of 577,000 machines and 1.4 million members. Of the total members, 511,000 pay a subscription fee of $39 a month and another 102,000 members pay $12.99 a month. The large volume of customers Peloton has attracted show that an audience clearly exists even at its more expensive price point. The bike is Peloton’s flagship product and is among the most highly rated at home pieces of gym equipment on the market. It’s a stationary bike with a large touchscreen attached. It runs a custom version of Android that only lets you view live or on demand cycling classes.

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Source: Peloton

Rumour has it Peloton are currently working on a rowing machine which is meant to be revealed in 2020.

Peloton went public in 2019 with their IPO price at $29 per share. However, their offering wasn’t quite as positive as hoped with the price opening the next day at $27 and dropping to as low as $25.76. 11% lower than the initial price. However, Peloton still managed to raise $1.16 billion through this offering. This gave the company a valuation of around $8 billion. Fundraising hasn’t always been without its hick-ups though.

Peloton is without doubt an innovative, exciting and successful venture. But there’s always a but.

Firstly, Peloton put a lot of emphasis on its wide variety of music and its ability to pump out music through its own high quality sound system. This was to create the studio feeling and get the rider really engrossed in the workout. Unfortunately, most people either have a good sound system or Spotify or Apple Music and have their own playlists for the gym. The customer has what they need from a music perspective and they’re not paying the Peloton membership fee for the music.

Source: Youtube

What can be learned courtesy of Peloton?

Well, sometimes if there’s a problem you just got to push through it yourself. If there’s no product that fits what you need…invent it yourself. If your goal is to become one of the top companies in the world then an IPO may be a great way to boost publicity and fans. Finally, the idea of using famous faces can work for any sized business whether using influencers or celebrities and getting endorsements for your business adds another level to your marketability.

And that is the Peloton way…that is their story.

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Robert Lee

Written by

I enjoy writing about the latest gadgets & tech. Plus stories about entrepeneurs, lifestyle interests of the day etc. Spread the love

The Startup

Medium's largest active publication, followed by +734K people. Follow to join our community.

Robert Lee

Written by

I enjoy writing about the latest gadgets & tech. Plus stories about entrepeneurs, lifestyle interests of the day etc. Spread the love

The Startup

Medium's largest active publication, followed by +734K people. Follow to join our community.

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