“Passion is key. Be obsessed with the solution you’re offering,” shares Ed Buckley, who transformed the fitness industry through creating a flexible corporate wellness program. Tune in to Million Dollar Monday to hear the story of Peerfit and key advice to growing a company through networking and fundraising.
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“Passion is key. Be obsessed with the solution you’re offering,” shares Ed Buckley, who transformed the fitness industry through creating a flexible corporate wellness program. Tune in to Million Dollar Monday to hear the story of Peerfit and key advice to growing a company through networking and fundraising.
Chapter Summaries
Key takeaway's
Resource Links:
CONNECT WITH MILLION DOLLAR MONDAY!!
Yeah, I think passion is the key, right? You've got to be passionate if you're doing this because you have a degree in entrepreneurship or you think startups are cool, you are doomed to fail. You have to be obsessed and passionate with the solution you're trying to go in and implement, or the disruption you're trying to bring to an industry.
Greg Muzzillo :Hello and welcome to Million Dollar Monday. I'm your host, Greg Muzzillo bringing you real successful people with real useful advice for people with big dreams. I understand big dreams. I turned an investment of$200 and a lot of great advice from some really successful people into my big dream Proforma. That today is a half billion dollar company. Well, hello and welcome. Million Dollar Monday. I have a very special guest today who is passionate about fitness, something I also want to be more passionate about myself and somebody who is the founder, chairman, and CEO of a company that has won many national awards for best company culture, best leadership, has won a regional Emmy award, best places, and workplaces from entrepreneur,USA today. And I'm excited to welcome chairman and CEO of Peerfit Ed Buckley. Ed, thanks for joining me.
Ed Buckley :Thank you for having me. Absolutely a pleasure.
Greg Muzzillo :Tell us What is Peerfit. Number one, and then where did the idea come from?
Ed Buckley :So at Peerfit, we help employers and health insurance plans pay for their members to go to fitness experiences. So think about, I have Aetna and Aetna pays for me when I want to go to boot camp or I want to go to cycling class, or I want to go to my local big box gym. Whether it's here in Tampa or I'm traveling to New York city and I want to take a class, right? So we built that mechanism that allows them to do that. So it's pretty painless. I'm just on my phone, on my app and say, oh, there's a great boot camp class today. Boom paid for. It's automatically paid for, and this case, right? Aetna is my health insurance plan, but we've worked with a number of different ones and we've expanded that to not just be employer side, but also on the Medicare side. So people that are over 65, can I have a more modern, set of fitness experiences to go to for the longest time You know, you heard the silvers and the silvers were nothing, but the gyms, the gyms, the gyms, well, what about all these boutique locations? What about streaming? What about, you know, that's what we kept asking was, well, that's the same network. It's the same approach. It was 20 years ago. Certainly the fitness have evolved how have our offering for seniors evolved? So we got into that space about two years ago. So we now really serve, you know, from the day you turn an adult to the day you stop being able to do anything physically active. We got you.
Greg Muzzillo :So educate me a little bit. So you're saying that there are insurance insurers that will pay for their insured to go work on their fitness.
Ed Buckley :Absolutely. It's really about being physically active and going with your peers, right? The mental, emotional, social health. It's not just about the physical activity, it's the peer in Peerfit, right? We want you going with other people. We want you going with your peers. And I think the worksite wellness industry, which was coming into be, you know, in Vogue, in the early 2000's was very, analog. It was offline, it was clunky. And so for us coming in, you asked, you know, how did I get into it while I was on the fitness side of the house, right? The gym side of the house, the, the instructor. We knew that there was something there, from an intervention perspective, right? Can you get people into group fitness and good things happen, right? Get out of the way and good things happen. So we knew at that point, really what we needed to tackle was the access point, right? Having a membership that can go from place to place, having the money, travel with you, going from place to place, making sure the signup wasn't, clunky when you go from all of these different places and making sure that you and the five people that you work with, you know, Greg's got one membership, Ed's got a member, one membership, erase that we all have the same universal one. So there is no friction. If you want to invite me somewhere, I can go.
Greg Muzzillo :Wow. Okay. So you have this idea, you've described now what the company does, where does that idea come from? How did, you sort of get that idea? And then when did you sort of get the idea to turn it into a business?
Ed Buckley :I was teaching group fitness at the time, and I had just realized how powerful classes were, how sticky that they were, that people joined gyms and left gyms because of the instructor or because of the class. And so the idea was, well, then people probably would love to cherry pick the best classes around town. They need flexible access. That was the initial thought, how do we make it really, really simple to get the decision-making and the access on flexible fitness. Then as we went into it, we always assume that corporate wellness or worksite wellness dollars would be a piece of the business, but it turns out that it was the business. That was the piece, you know, you can't do all things to all people. You got to find one lane and run it. And especially when you're getting that early traction. And that was the catalyst of growth was to, go down that lane from a distribution perspective. And, you know, we've, been rocking and rolling here for many, many years since we made that change.
Greg Muzzillo :Well. So was part of that calling up insurers and companies and gyms, et cetera, to find out if they liked your idea was part of that just vetting the concept.
Ed Buckley :Yeah, definitely calling gyms for sure. In the early days we thought this was going to be a direct to consumer solution. So, really we were doing all of these different pilots with people. Did they like flexible fitness? How would they consume flexible fitness? So I would say the first three years of the business was us running different pilots with people, different types of flexible fitness, convincing the gyms to let us do flexible fitness. Cause you have to imagine we were going to them and essentially asking to do the one thing gyms have always hated doing, which is not locking somebody into a membership. That's what they wanted. So it was a difficult proposition in the beginning, but you know, we did it for about three years and the aha moment was when we were doing an interview with a customer who just said, this was a really cool novel thing for a month, but unless I get to have it every single month of the year, I still have to keep my gym membership because this is only temporary, right? This is only temporary. And that's when it was like, this should replace the normal status quo. Right? And then we received an investment from Florida Blue, Blue Cross Blue Shield of Florida. And they, told us, they said, we know you're direct to consumer humor us go sell this as a benefit, go, talk to employers. And we had a couple initial conversations and they loved it. Right. It was direct to consumer grade kind of quality and feel that if they could offer it there, people would love it.
Greg Muzzillo :So tell our listeners and me too, how do you go from an idea to getting some awareness from Florida Blue to getting some money from them? How does that happen?
Ed Buckley :Yeah. I don't know if there's a repeatable, hey, just do this right. But what worked for us was we, were scouring the internet and, and talking to everybody where are there startup events? Where do you get to meet local investors, reading stories of other entrepreneurs and how they raised money and just talking to everyone about our idea and the way we got there is classic like on-paper networking. We would just be sharing this amazing idea just to, because we were energetic about it and trying to hear input from people. And someone would say, you know what? I've got a friend who invests in early stage startups, you should meet them or, you know, but you think it took a thousand of those conversations before we finally had that. But once you get the first person in your network that is somehow connected to investors, then almost everyone is now connected to investors. So it took me three degrees to get there. And then from there, it's just literally talking to them about your idea, talking to them about your passion. You know, then someone says, well, Florida Blue is going to do a program to support early stage startups. Have you met with them? Go through the application process. So it was just literally a series of trial and error going through networking,
Greg Muzzillo :Trial and error and networking. Talk, talk to us about approximately how many people did you approach talk with, reach out to before the whole Florida Blue thing happened?
Ed Buckley :Yeah. I want to set aside an amazing example. Years later after I had raised a lot of this money, right. We raised$50 million. Now. It was probably at this point when we had raised about 30 million and I was speaking on a panel here in Tampa and there was someone on stage. And she was talking about how unfair raising capital is. And she went to 10 different investors and still hadn't raised money. And so this whole system must be rigged and I just was laughing because at that point we'd already raised 30 and still for me to raise money. I'm like, I still have to do a hundred meetings, right. To do that. The expectations, the reason I tell you that is like to set your expectations is you're not going to have 10 meetings. And it's like, where's my money. You know, at that time, I want you to think about, I was a grad student from middle-class family, no connections to business people or fundraising, like none of that. So I was starting as, as kind of like from scratch as possible. I mean, I literally talked to everyone. I knew for six months, just about the idea of not asking for money, just talking to them about the idea before we finally got someone who said, oh, well, you know, there's this now, now granted Florida at that time, think we're talking about like 2012, right? What we're talking about versus 2021 today, the amount of sophisticated institutions doing early stage investing is 10 X today. What it was then there was mainly a couple of individuals, but things that were early stage in meant, you have to have at least 5 million in revenue at this point that was early stage to Florida. Whereas today, if you've got a good idea, there's tons of different avenues for you. Tons of avenues. So I grew up in a different time of fundraising in Florida, for sure.
Greg Muzzillo :So about how much did you initially raise from friends and family? Just approximately
Ed Buckley :I think over time we did about 300,000 over successive rounds from friends and family.
Greg Muzzillo :Now upfront early, the earliest stage.
Ed Buckley :40,000. Yeah. Yeah.
Speaker 3:Right, right. That's important for people to hear. It's not like getting rich quick. This is just like a little bit of money. That's barely enough to do everything that a business needs to do. And are you able to tell us how much, the Florida Blue put in, in the first round?
Ed Buckley :I think in the first round they put a bout 50,000 or 75,000 somewhere, just south of a hundred thousand.
Greg Muzzillo :So some very small really in the world of fundraising rounds. Tell us when, when was the next, after this initial investment, talk about how you grew the business and then went and kind of got a first meaningful, large chunk of money.
Ed Buckley :So after we finished this program with Florida Blue, we raised approximately a million and a half dollars. I think it was about 1.5 and Florida Blue participated in that because we came out of their program and was awarded the top innovation so, top of our class. And so that guaranteed us getting t hem participating in a r ound. And we really actually, we raised, I think of the 1.5 w e raised about the first third of it and then just hit a like, wall. We just didn't get traction from people. And it was months later, like we're just out fundraising, you know, hat i n hand trying t o, t rying to meet people. And then, you know, we meet the group that is now the Florida Funders team here in Tampa, Mark B lumenthal, Lance, Lee Arnold, that group believed in us. And next thing I knew they g rabbed, a hold of us and helped us raise the remainder of the money
Greg Muzzillo :Mark's a great guy. Mark has been on Million Dollar Monday, and he was, he was a lot of fun and we probably could have done three shows together right because of his experience, so tell the group, listening, who is Florida Funders because they probably don't know.
Ed Buckley :So there is a, group, headquartered out of Tampa and it is a novel idea, which was, there was no early stage investing in Tampa. And so their first iteration was let's just do kind of organize crowdfunding. That version was successful. So then they went up and said, well, why don't we raise a formal fund to sit next to that crowdfunding. So we'll then say we have a million dollar fund. That company is going to put in 50, the first 50 grand. Now pass the hat and you guys raise the other 250, that then was successful. So they've gone out. And I think they're fun to now is, you know, 20 million,$30 million. And so they really have all shapes and sizes. They've been in a lot of different deals, but they helped make early stage funding and Florida a thing. Because as I mentioned, you know, six, seven years ago when I was raising money early stage meant you had to have 5 million revenue before anyone would talk to you.
Greg Muzzillo :Yeah. Yep, yep. And probably most towns today, most major towns would have a group of angel investors or whatever they're called that have some sort of organized or semi-organized, there may maybe even unorganized group of folks that are always on the prowl, looking out for great ideas to invest in. How would you advise people listening from wherever they might be? How could they go find that local group of folks?
Ed Buckley :I think to your point, even the disorganized ones, it seemed to have a website, right? Or a Facebook group. So typing in, you know, your city, Tampa, early stage funding, Tampa angels, Tampa startups. You will find them go to a handful of these startup events and just ask who are the funders in this town who's really worth talking to? And can I get an intro? It doesn't take too much digging to find them nowadays.
Greg Muzzillo :As we close out our time together, what big pieces of advice would you have for those folks that are where you were not that long ago? Aspiring entrepreneurs, very early stage entrepreneurs.
Ed Buckley :Yeah. I think passion is the key, right? You've got to be passionate if you're doing this because you have a degree in entrepreneurship or you think startups are cool, you are doomed to fail, you have to be obsessed and passionate with the solution you're trying to go in and implement or the disruption you're trying to bring to an industry. That's the first thing. Other than that, you just got to strap in and ride the roller coaster because you have very little control day to day, other than how you react, how your own emotions, you know, are, fluctuating from day to day, minute to minute. But if you're passionate and you're just moving forward every day, the good things are gonna happen.
Speaker 3:Yeah. All right. One final question. Cause you mentioned the word rollercoaster and I agree with that. Right? Strap it in. And these high highs, those are fun. Right. And whatever the high five moments are where I'm sure you and your buddies all high five each other about fundraising rounds or new customers or whatever it might be that key hire or whatever. Talk to us though, about what pieces of advice do you have when that rollercoaster goes this way? And you're trying to turn it back back up. What key pieces of advice for the bottom of the rollercoaster?
Ed Buckley :Well, there's two things that kind of rub against each other at this time, which is if you're really passionate and you're fairly competitive. When you take a loss, it almost energizes you more than those high highs, right? The highs are almost uncomfortable because you spend so much of the time at the bottom of the rollercoaster. So you kind of are expecting it. So when you have the loss, you're like, okay, I now have an enemy against art. I failed here. There's a clear thing we need to solve. Right. It almost galvanizes you during that time. But unfortunately the other side that rubs against that is your mental morale is down because you just got kicked in the stomach or your endorphins had been riding high for three days. And right now you've got to work without those endorphins because something bad has happened or unfortunately, negative pressures coming in from your board, your investors, the media, you know, whatever it is. So it is at one part you're almost a little bit more motivated and focused, but the other is you've got heavier baggage during that time.
Greg Muzzillo :Yeah. It's a wonderful journey though. And I love what you said because what you're really saying is of course we all know the high highs are fun and they're exciting or whatever, but you're saying embrace the low lows and see them as opportunities to get galvanized, to get excited and to figure out whatever it is that gets you back to grow. And you're going listen to it. It's been a lot of fun spending time with you. Your energy and enthusiasm is contagious. I'm sure it builds over into all phases of your life. It's been a lot of fun spending time with you. Thanks Ed.
Speaker 1:Thank you so much. I appreciate it.