Classpass Founder: Quitting My 9-5 Led To A $1 Billion Business: Payal Kadakia
Guests: Payal
Full transcript · Read the full conversation in order, with its original context.
Contents1 chapter
§01Transcript — part 1§01Transcript — part 1
I think society says success is: get this job, get married, get a house. What does that do to you? It just really makes your life feel small.
The founder of ClassPass monthly fitness program, a billion-dollar founder, Payal Kadakia.
When I would watch my parents not really fit in, it sort of made me realize maybe I don't fit in. Then to be told I smelled or I didn't belong somewhere... everyone wanted to box me into something, and I just refused to be boxed.
We spent half a million dollars building a product that didn't work. Was I exhausted? Yes. Was I lonely? Yes. I missed family things, I missed weddings. I was just not around. I have learned at this point that time means more to me than money. I want to make sure my priorities are more reflective of the human I want to be in my life.
If you go towards purpose, I guarantee your life will be more fulfilling.
Do you believe that everybody has a purpose beyond the nine-to-five?
I do.
How do we find it?
So, first of all...
So without further ado, I'm Stephen Bartlett, and this is The Diary of a CEO USA Edition. I hope nobody is listening, but if you are, then please keep this to yourself.
When I read someone's story, one of the first questions I try to answer when I'm reading through that, especially their early years, is I'm trying to identify what it is that made them either an anomaly or hungry. I have a kind of a thesis that much of people's drive and their ambition, especially the people that I sit here with, comes from some kind of pain or trauma or early experience that molded them. So my question to you is: what made you hungry?
When I was younger, I got to taste something that was so magical, which was dance. It was this place in my life that wasn't about the physicality of actually dancing; it was the ability to make other people feel through something that I did.
To be able to realize that as a human being you can have that type of influence, power, and connection to other people—and to feel that when you are four or five years old—was just this magical experience for me that, honestly, nothing else in my life could compare to it.
Once I uncovered that, I always wanted to feel that in anything I did. I strived in all the work I did, in all of the different careers I've had in my life and the different art I've done, I've strived always to go back to that intention of how do I give to others and make them feel something in their life. That's really been this anchor for me, and it's purpose at the end of the day.
And that started at five years old?
Yeah, when I was really young.
With a dance at a wedding?
Yeah, it was just a random dance performance that for some reason I started dancing and everyone started watching me. It wasn't anything that was a structured performance by any means; it was very much just this organic thing that came out of me, and I really just loved it.
I realized, actually, in a deeper way that the other part of the hunger came from when I danced and felt that feeling, I felt like the most authentic version of me. I realized that I was in so many settings where I didn't always feel like I could be me.
Whether that was being an Indian girl in the middle of a town where no one looked like me, or sometimes being with my Indian community but being in a town where I was a cheerleader and I didn't fit in there, I realized that so many parts of me never felt whole. I was always showing up with one little strand of me here, one little strand of me there. I felt when I performed and danced, especially Indian dance, I felt like the most whole version of who I was.
The resistance you felt and the struggle you felt of trying to, I guess, conform to two different communities at the same time—tell me about trying to be an American in a town where there's 300 people at your school and you're the only person of Indian heritage. How is that?
I think one of the most interesting parts of it is so much of this comes from the parents, not really from the kids. When I would watch my parents not really fit in, it sort of made me realize maybe I don't fit in. It was sort of this interesting way to look at my parents and know that they felt uncomfortable, and then look at myself and be in different settings and realize: wait, I don't look like everyone else.
Then to be told I smelled, or my food smelled, or I didn't belong somewhere because my hair color was different, was just a very interesting place to be.
Kids said that to you?
Yeah, I talk about it in my book, but there were some really harsh moments. When you're young, you're impressionable; things can scar you for a very long time. I think for me, the goodness was that I did have this place of dance that made me feel grounded and made me feel whole.
If I didn't have that, I think the trauma that I was probably going through by not fitting in would have just burned a hole so deep in me that I'm not sure how I would have been able to recover. But I had this light. I think that's going back to what you were asking; it was the light that I saw that there is something beautiful out there for me to go and do for the world if I can just hang on to it and fight for it.
It was a fight for me to even hang on to whatever my identity was. We talk about our identities in all these labels, which I really don't love—whether it's Indian-American, CEO, whatever all these labels are. It was really, I think, my whole journey in my life was a fight to be myself in any setting and not have people tell me what to do.
We all struggle with that in our whole lives, and it is probably why I had to be a CEO because I don't like anyone telling me what to do. But it really stemmed because, I think throughout my life, everyone wanted to box me into something, and I just refused to be boxed.
Did your parents want to box you into something?
Of course. My parents sacrificed everything to come to America. They obviously wanted my sister and I to have successful careers, which amounted to a few different industries: be a doctor, a lawyer, engineer, or then the other part of it was get married at a normal age where you could cook for your family and be a good wife.
These were the expectations that were set in my life. I think that's really the hardest part: when you are constantly brought in your life to saying that you need to live by the expectations of others, you end up either rebelling or you conform.
I always wanted to make my parents proud, so I knew I did what I felt was at the core part of the value. For example, if it was getting education, I thought that was important too; I wasn't going to sit there and rebel from getting education. But there came a point in my career trajectory where I had to say, "Okay, I have checked every box in this. Now I have to do it my way, with the way I really want to feel, and not conform and rebel." I think that's really the whole formula of people knowing when to rebel and when to conform.
You referenced that you were looking for a different feeling after checking those boxes. What was the feeling you had when you were doing that job?
I had trained myself my entire life to do well when people told me to hit this mark in my life. That's how I developed the skills in my life to always propel myself and execute and make sure that I was able to be responsible and move forward in everything I did. But I felt no deep fire or passion or love towards it. I wasn't jumping out of my bed to go to my office to go and work for my clients. I was doing what I had to because I knew it was expected of me.
You must have friends that are living a life that is expected of them. You can start to see as the years go on the consequence of living a life that is expected of you. What would you say to those people, and what lessons have you learned about living a life expected of you?
That's not the way to have a fulfilled life. You can have a life and you can probably check all the boxes and make your people proud in your life, but you're going to be on the other side of it and feel empty. That feeling of emptiness is the worst feeling anyone can ever have.
I think people come to it at different points in their life. They either come to it when they're 20 or they come to it when they're 50, and that's because they haven't done the work to actually ask themselves: what are the expectations you want for your own life?
That's the problem; I think we're never taught that. No one's ever asked us what we want for our own lives. I think society goes and tells us, "Okay, success is get this job, success is get married, get a house, have kids." Especially for women, it's even a bit more of a closed road. What does that do to you? It just really makes your life feel small because it makes you feel like you can't get past it to go and live for your dreams.
Ultimately, I've been there in my life where I have felt like the road has closed in, and it's left me feeling hopeless. That's the worst place in the world to be—feeling hopeless. The best thing you could do is feel like you can go and do anything, change the world. I think the more you taste it, the more you want more of it in your life.
At that phase in your life, were you battling somewhat with your North Star—that light you referenced earlier which was dancing—but also your nine-to-five? Tell me about that battle and how dance ultimately ended up winning.
I remember always having this bounce in my step. I would walk to work in the middle of New York City choreographing in my head, listening to the song I was performing. I in a weird way was embodying this life of what I wanted to be. Then I would get to the office and I would do my work. Once again, I love the Steve Martin quote of "be so good they can't ignore you." Whatever work I've done in my life, I will do 150% if I say yes.
But I knew that something was wrong. I didn't want to live like that. I didn't want to feel like I was hiding so much of who I was. As my nine-to-five—which, by the way, in consulting isn't a nine-to-five, you work like 80 hours a week—as I realized that if I wanted to commit to that career path, that 80 was probably going to go to 90, was going to go to 100, was going to be traveling, and I was going to have to say no more and more to the thing I loved.
I just realized I wasn't willing to make that tradeoff. I think that's sometimes the hardest thing people have to think about: what are you sacrificing and what's the tradeoff in your life that you're making? I just wasn't willing to make it at that point. I had done so much in my life where I felt like I had achieved, according to everyone else, enough to start taking a little bit of a path to being rebellious. I think that's really when I started to do a lot of work to say, "What can I do to bring all parts of me to the table?"
When you make that decision to leave Bain & Company, the management consulting firm in New York, was there a series of catalytic or pivotal moments near the end of your time there that made you think, "Forget this"? I read about a meeting you had, a performance review.
That is literally the opening of my book. A few things happened, I would say. First of all, most people stay in consulting at this job for about three years, and then you go off to business school. It's sort of the usual route people take. I was in my third year there, and a few people can kind of stay on and just continue there. I really wasn't interested in going to business school at the time; I wanted to live. I wanted to be in New York City and feel the energy of it.
In my third year, I had a performance in the middle of Times Square for this big unveiling of Aishwarya Rai's Madame Tussauds statue. That was an important thing, and Aishwarya Rai is one of my icons, especially as a dancer; she's a huge Bollywood actress. The week before, a client meeting gets scheduled at the same time as my performance.
My clients are big clients; these are Fortune 500 companies. These aren't small clients by any means, and we're meeting the CEOs and CFOs of the company. I remember talking to my boss saying, "Hey, I really want to go to the performance. I'm not a big part of this meeting; is it okay if I miss it?" We talked about it really briefly; it wasn't a big deal. I didn't feel bad about it. I went to the performance, and it went well.
A few months later, we're sitting down talking about my review, and she's giving me feedback. She says this thing to me which just triggered me, and it was: "Is this the job you really want? Because I don't think that you want to be a consultant." I took that in my heart as, "Oh my God, she doesn't think I'm good enough."
I just went through how throughout my life I've been taught to be Type A, everyone tells me I've done a good job. So my initial reaction to her saying that to me was, "I'm going to prove to you how good I am." That's the natural Type A reaction, to say, "No, no, what do you mean? I love this job, I really want to be here."
The more I started thinking about that, the more I realized she was right. I didn't want to be there. It was not the life I wanted, it was not the career I wanted, and that's when I decided to start looking at other jobs that would give me a bit more of the flexibility I wanted in my day-to-day but still pay the bills.
And that's when you moved over to Warner Music Group?
I went to Warner Music Group.
There's this really interesting balance that I see in you, which clearly shifts in your life, where you feel like you're—correct me where I'm wrong here—but you're quite a good conformist in terms of expectation, and then slowly rebellion starts to creep in. It just had me thinking about what is probably the right balance of conformity and rebellion in our lives.
Because conformity makes sense in some regards; you can't just be a total rebel, or we'd all be living out in the desert or something. But just the interesting balance I see in people like you that I meet—a lot of them start as kind of conformists or a little bit more people-pleasing, especially first-generation immigrant families, and then that fails them in terms of fulfillment, happiness, and mental health. Then that's where the rebellion starts to...
I think that's the key. It's rebelling for the right reason. I always believe that I was rebelling for purpose. If you're rebelling for purpose, I think it's exactly... it's justifiable. Dance wasn't something that was just, "Okay, Payal, go and do this because it's a hobby." It was this place for me to bring together so much of my trauma, actually, from when I was younger.
My dance company was this Indian-American dance experience, and it was about me bringing together the Payal who got made fun of with the Payal who danced at her Indian festivals, and bringing all of me together to say, when the world doesn't want to accept the different parts of who I am, I'm going to show you what it can look like.
That's really a big part of what I realized in my journey: when people have told me parts don't fit together, I find a way to put them together and show you even a more beautiful experience. I believe even ClassPass was really the epitome of that too in my life—bringing parts of me together that I would never have been able to bring together in any other way. I think so much of when we're rebelling, it's about fighting for something. I wasn't trying to rebel; I was fighting for my passion. I was fighting for my purpose. Isn't that what life should be about?
When you leave Bain & Company though, is there a part of you—because that expectation is heavy—is there a part of you that whispers in your ear and goes, "You failed"?
What was hard was all my colleagues who at that point had gone to Harvard, gone to Stanford. I was comparing myself to them, and I felt like I was taking a step back compared to what they were doing. But one of the other important things I learned during this time—and I think this is an important part for all of us at any phase, especially when we're going through these transitional times—is I also embraced a new community.
I obviously didn't just define myself by my Bain and MIT friends. I had this huge artistic dance community that was sort of like growing, this Indian-American community that was sort of coming around me. That made me feel whole in a different way. So instead of constantly being around people I felt less than, I went and found a community I belonged in, even though it wasn't the one that I would have felt inclined to go to.
I think that's another important thing, especially when we're exploring these decisions and identities, back to the light thing: sometimes it's not the people we think are going to give us the light who give us the light. Find that new community that makes you shine.
It's such an unappreciated point of resistance for people that are trying to make an adjustment in their life. I hear it so much; people say, "I want to leave X situation, but I'm scared of losing the community that comes with that situation." That could be a city, it could be a job, it could be a partner. Sometimes your lives become so intertwined that you think, "Well, if I lose this partner, if I lose this job or whatever, then I'm going to lose all of these people." That really keeps people trapped.
I agree with that. That's such a good point. You can find new communities, and I think you have to remember that the people you surround yourself with are your choice. I've had different communities show up for me at different times in my life. For me, it was the different communities that made me the entrepreneur I was. It was my business community that helped me build ClassPass, but it was also this girl who was going to ballet classes every single day with my dancer friends who also was thinking about the classes that people need to take in their life. It was that unique combination of my traits combined with the different experiences I was having that enabled me to build what I did, ultimately.
You talk about how you managed to get a job you considered to be more of a nine-to-five where you've got time in the evenings to dance and you end up setting up your own dance company. How do you get from there to that pivotal trip to San Francisco that introduced you to the world of tech?
In those two years when I was at Warner Music Group, I started tasting leadership and entrepreneurship. I started tasting this idea of what life could look like when I was living to my own drumbeat. We put on a few shows in New York City during that time that, honestly, just were so well received from people. The momentum of that, the feeling I felt of my community support—it made me just start feeling confidence in my ability to go after my dreams.
I think this is an important part of the journey that we also forget: it's the confidence in the small stuff that actually builds the confidence towards the big stuff. Because it wasn't Payal just decided to go quit her job one day and start a company. It was the series of small steps. It was putting on a show for 150 people that went well, then putting on a show for a thousand people that went well, then saying, "Wait, let me think about my life in a bigger way."
That's sort of where I was at that moment. I wanted to explore new career paths that I could take, and that's why I decided to go out to San Francisco, and it changed my life.
The point you made about the way confidence is built, I think, is so, so important. Because I think a lot of people think—they see people like you now sat here after all this, all you've achieved, and they think, "How do I get from where I am sat on this sofa in this job that I'm in that I hate to being her?" It seems like such a huge canyon I have to cross that it feels like you must be from another planet. When people see you at the finish line, it can sometimes be quite demotivating. But what you've just said there is, in fact, there's these small... it's a staircase, one tiny step at a time building subjective evidence in yourself that you can do a little bit more than you thought. I'm curious as to what makes people like you take that small step. It sounds like it's you're just driven; this purpose is driving me.
Purpose, 100%. If I wasn't driven to make an impact in the world, I wouldn't do it. I mean, yes, like I could go and get a good job and do all of that and live the expected life and be fine, but that's not fire. That's not me taking my hours of five to ten p.m. after work and reserving studio space and getting girls together or working until two, three in the morning to make reservations for people to get to class. That's a very different "why."
I think that's why I go back always to: how do you find that "why"? What is that light that your life is always about? I feel very blessed that I found something that made me feel a sense of service so young because nothing compares to it. No amount of money, no amount of press or any of that is ever going to compare to the feeling of touching somebody's life.
So many people in my DMs are like, "How do I find my 'why'?" It feels almost like a privilege, doesn't it, for people that have figured that out? There's people that will be listening to this in the morning washing the dishes, driving up and down the country in a delivery van, whatever it is, thinking, "I know I'm capable and deserving of more, but I just don't know what it is." Do you believe that everybody has a purpose beyond the nine-to-five?
I do.
How do we find it? Where is it?
I think at the end of the day, it's already inside you. It's usually ourselves that are unwilling to listen to it. Just ask yourself: what did you love when you were younger? When did you light up? Who are your role models and inspirations? What's that thing you look at for a second longer? Who's that person you want to talk to for a few minutes more and why? There is something pulling you there, and you have to be willing to go down the path of exploring it and trying it.
I think that's really the hardest thing: we put so many blocks on ourselves. And I get it; I mean, our society tells us this is the way to live. It does not tell you to live purposefully and to go and chase your dreams. I mean, yes, we do in the Instagram world of life in quotes, I get that, but the structure of our life is not actually built that way.
And like you just said, I mean, you compared it to the nine-to-five, which is about making money. I have a whole chapter where I talk about money because money is the most trapping thing. That's the reason people aren't willing to do it.
Usually you know it; I always ask people this when they're like, "I don't know": if you had all the money in the world, how would you spend your day tomorrow? That's like a very good way to start exploring. What would you do without one of the biggest constraints that is probably on my mind? What would truly make you light up?
It's not about buying stuff. At the end of the day, anyone who wins the lottery, you know that they can go buy stuff, but that's not fulfillment. At the end of the day, it's a sense of purpose. I think people have to just get themselves in a place where they're trying new things. It does honestly feel like a privilege, and that's part also of why I started ClassPass—because I wanted people to, in a way, live a life that I knew I was.
I was sitting there when I was in my early 20s, and I would spend my weeks performing for a show. I'd perform on Saturday night, invite people to come and watch me dance, and I remember I felt like I had a pep to my life and my step and all of that. I want everyone to have that.
I remember thinking, "Wait a second, like you used to be an athlete, you were training for the Olympics, you were this amazing singer, and you now just show up and go to work all day and don't think about finding time to even explore these things?" So my contribution to that was honestly creating ClassPass. That was part of my very big inspiration for it: how can I give some of that to other people to go and try something and potentially have that same enlightenment in their life so you kind of get out of your path and your routine and meet a teacher that will inspire the growth in you and that reflection in you? Because most of the time, the hardest thing to do is to ask yourself what you love in your own life.
When was the moment—because I read in your book, there's certain pain points we encounter where we realize, "Okay, I can solve this problem," and the manifestation of the solution is this app or this website. What was the problem that you encountered and when that made you think ClassPass is the solution?
I was, once again, training in ballet at the time. I had my nine-to-five, but every day after work, I would go and train in ballet. I had been going to the same teacher for about six months at the time, and I wanted to try a new class. It was just like a very simple thing I wanted to do.
I get onto my computer, I start browsing for this class. Two hours go by; it was just this terrible experience from an information standpoint—from not knowing what class to take, if it's close enough to me, what time it starts, how do I register.
That's when I started looking at other models that existed. So there were things in the US like OpenTable, SeamlessWeb, that had just made this type of information so accessible and so easy and convenient for customers that I started thinking, "What if I could do this for classes and therefore get people to get an hour out of their life that was out of their routine to go and do something fun and exciting?" So that was really where it started.
Let me caveat that. I had come back from San Francisco 36 hours before that, and when I was in San Francisco, I had met a bunch of entrepreneurs. This was my first time ever meeting entrepreneurs. So going back to even the whole "trying new things" conversation, it was really important for me to take that trip to SF.
I had been sort of stuck in New York City; I had been living the crazy dance life, the crazy nine-to-five life, and I had no time for anything else. So I wasn't trying new things, and I needed an epiphany, I needed something to change because the two roads I was on, they were going to crash at some point and it wasn't going to work.
I decide to go on this trip, meet a bunch of entrepreneurs, and I come back thinking, "What if I could be an entrepreneur? Let me give myself two weeks to think of an idea." That's literally the mindset I was in when I encountered that. So 36 hours later, I happen to be searching for this ballet class, and that's... it was just during this perfect period in my life.
Honestly, this is when I sometimes think: does the universe make us do these things? Because what are the chances of all that happening at the same time? But it did. I really remember in that moment thinking, "I know I'm the right person to build this because of this background I have, the communities I've been in and around, the experience I have. There's probably no one else who cares as much about dance who then also went to MIT and Bain."
That is extraordinary. A lot of people will encounter things—I'll encounter things today. I might sit on a chair and be like, "This chair could be better," but then I'll carry on with my day. I'll open the fridge and go, "This fridge could be better." But that feels like the pivotal moment which a lot of people listening to this, they'll all notice things, maybe they don't even notice them because there's something in when you start looking... in your case, you were actually kind of looking for a problem to solve. But it takes a certain character makeup to say, "I can be the one to solve this." Also a little bit of delusion if you look at the stats.
Fair. That's a very good point. I was definitely delusional at the time in thinking that. But you know what it was? It was more of "I want to try to solve this problem." Regardless, because it felt so tied to everything I had done in my life. I had literally fought to dance every year of my life up until that point. Why not bring the fight to everyone else?
That's how I felt. I was like, "I've already been doing this; let's just go and make this happen." And by the way, I also used my left brain, which is my analytical side, to go and do the market research. I was able to raise money. I definitely did this in the practical way too, and I was making sure that it wasn't just some crazy dream.
There was substance to it, for sure. I wouldn't have been able to raise the capital I did; I got into an incubator. It was a good idea in the way... and it once again, it stemmed from a really deep "why" in me, and that was the most important thing. I think that's when we can talk a little bit about the failures and the points where the product didn't work.
But I was never obsessed with getting a product to work; I was obsessed with solving a problem from day one. It's: how do I get people to class and not make it so hard for people to get to class? Why is it important for people to go to class? Because then they can feel what I have in dance in their life. It was just such an important mission for me that I could just never stop on it, and every day it fueled me because it was just so real for me to say I gave this to someone.
Even today, we've booked like 100 million hours of workouts at this point, and when someone comes to me and says to me, "I just went and worked out because of ClassPass," it brings me joy because that's an hour of their life that was like what dance is to me—that I gave them out of their routine or expectations or the way society wants them to live that they did for themselves. That is such a gift. I think in my life I knew fighting for that was always a win whether it worked or not.
But what if it didn't work?
If it didn't work, I had a backup plan. When I say I had a backup plan, I mean I went through my finances, and my dad and I were very clear about how much money I had saved at that point to say I had three years to build this. I had three years before I ran out of my own cash. And you'd been a saver.
I had saved. So that's the other thing is, because money can be the biggest hurdle in going after our dreams, and if you know you're a dreamer—and I think I've always known I was a dreamer, whether I was going to spend my money to build a company or build or put on a dance show, I knew I was always a dreamer. And so I didn't care to spend money on the smaller things in my life. I just didn't travel, I barely went shopping.
These are decisions I made. I think it's so important; I'm not saying that because I want other people to do the same. It's about you knowing and thinking about it in a very deliberate way of how you're spending your money. I was building up a savings; I didn't know what I was going to spend it on, but then when this idea came and I got to sit down, I had three years to go after running towards something.
Were you scared at all?
I was excited. I mean, it was an adrenaline rush. I mean, there were times where it was terrible and challenging and sucked, but I wasn't scared. If I was scared, I wouldn't have done it. I think if my fear trumped my confidence, I don't think I would have been able to quit my job and go for it.
When you quit your job and go for it at Warner, you have a meeting with the chairman. You're 28 years old; he says something interesting to you. I think people will say to you "Oh, the luck," but actually it's very much the opposite because he said that he would invest.
So I mean, this goes perfectly with what we were just talking about. It's really... the reason I didn't get scared is because more and more opportunities and doors just kept opening for me. It was almost like the universe just started guiding me in the most beautiful way towards the mission, towards the purpose, towards the answer in a way that I felt before I was blocking it.
The second I decided to go after building this company, one of the biggest things I had to do was quit my job. On the day I quit, I decided to write an email to people I had worked with in my company—some executives—and the vice chairman of Warner Music Group says, "Hey, come to my office, I'd love to hear what you're building."
Go up to his office—probably the second or third time I've ever met him in the two-three years I was there—tell him about my idea. He says, "Great, I want to invest." Literally writes me a check for $10,000 and gives me an introduction into a big incubator that was in New York City. I just remember thinking in my head, "This was the scariest door I'd ever closed in my life—quitting my job—but I'm literally walking out of here with a $10,000 check towards my next thing."
Why do you think he gave you that check?
A few things. One, so he was a former Bainie, so once again, reputation does follow you. This goes back to everything I was talking about in the sense of: it's always important to do good work because if he had ever heard, "Oh, Payal's not good," I mean, he knew that I was a good worker no matter what I did. Even though I didn't love my job, I always did good work, and I know that reputation followed me and he knew that.
We call that Invisible PR around here. It follows you, shows up years later.
Right, exactly. I think that was one of the big things. And then two, this was also an ecosystem where entrepreneurship was a thing. But I mean, at the end of the day, he believed in me. This is one of my favorite things that happened on the day I quit: I would go and tell people—especially people I had worked with who were much older than me—that I was quitting my job. Here I was, 10-15 years younger than most of them, and I remember everyone looking at me almost thinking to themselves, "I wish I had the courage to do that."
So I think you forget, me quitting that day was such a sign of courage and my capability, and I didn't even realize it at the moment. But being able to make such a bold decision at that age was a huge thing for even my vice chairman to see—to say, "Wow, like this girl is going to go for it." That was probably one of the first hard decisions I had to make in my life; I had to make so many more. But to sort of have that control over your life, your thoughts, your dreams is such an important way to live.
I asked that question about why he invested because in my time at my company, I probably had just over a thousand employees and there was two occasions where someone said they were quitting and they were leaving to start a business and I went, "I'm going to invest in your business." It was purely based on one thing: exactly what you've described, which was their Invisible PR. They might not even have known that I knew, but they were great. They always did great work.
That's why you have to always do good work. It's such a... and I think in this day and age people don't feel it as much even though it might be a job you don't love. We all have to kind of in a way like you have to earn your... what is it called? You earn your stripes. I remember earning my stripes to take the leap for my dreams, whether that was in money or skills or... and I don't regret any of that.
When people ask me how did you do it, I spent a lot of... it goes back to the whole conformist/rebellious thing. I was earning my stripes so then when I felt like I could leap, I had built the parachute in the plane. I wasn't taking a leap without anything around me; I had built a great structure that was going to then let me take the most rebellious of leaps what that came towards the mission.
I didn't have to rebuild all the stuff that was about my life and like worrying about money. This is also an important thing: when you are starting a company, if I'm worrying about paying my bills and if I'm worrying about like do I have the skills, then I'm not worrying about the most important thing, which is can I get someone to class? The number one thing for me to focus on was my business, not anything that was going on outside of that. And that's why I think it's setting ourselves up to succeed when we are leaders, when we are entrepreneurs, to be in a place where we're not worried about the peripheral constraints in our life.
Let's go to the start then of this ClassPass journey because I'm really compelled by... much of the reason I start this podcast was because I wanted to shine a light on the tough times in business. I know when you're starting a business, especially a business in tech, it can be really, really difficult because you're sort of jockeying and pivoting to find product market fit and to figure out what your customers want and how to deliver it. When you started, you quit your job in 2011 and then you go through a long phase of trying to figure out how to get people to use this thing, how to market it and all that. Talk to me about that nightmare.
We went into the market with a very clear product idea and it was a replica of what had worked in another industry, so OpenTable which allows you to book restaurant reservations—it seemed like the right parallel to what we were doing: go on search for classes.
But what I didn't realize was that there was a very big missing part in it—and I'll spare everyone the little details of it—but everyone has to eat, everyone does not have to work out. Working out usually is something scary for people and it's more of an aspirational thing; it's not something that you have to do every single day. So they were sort of on different planes of people's psychology, which really became the biggest bottleneck to what ended up happening because we spent a year, we spent half a million dollars building a product that didn't work.
Even though I had all this momentum, all these beautiful doors were opening for me and they were, and I had a lot of great what I now call false signals of success like followers, press—we ended up on the cover of Ink magazine without launching a product. All these things made me feel like I was succeeding because this is what success looked like to everyone else.
Then I launched my product and no one went to class. No one bought a class, no one was transacting; it was crickets. It was just a really... this was the hardest probably few months of the entire trajectory because I had never really faced failure in my life. I had tried to make sure that this would go well by doing everything that I knew how to, which was let's get the press, let's build a beautiful product, let's get as many email addresses as possible. Those were the obvious things that seemed like you would do when you're building a company.
But I had forgotten to really ask myself if I was solving the problem I set out to. I really think back to that moment and even though it was the hardest, that moment is the reason I became a real entrepreneur. I don't think I was an entrepreneur before that day. I was excited about solving something, but the day I failed was the day I became an entrepreneur because that was the day I really had to think deeper about creating something in the world that didn't exist.
I think it's so easy to follow the blueprints of everyone else and realize that entrepreneurship is actually about having no plan and having not following anyone else's ideas of what success is. It's about figuring out what is it to solve your mission or your business model that you're going after. That woke me up, and it was a month-two-year period where we were trying to be comfortable.
It was this comfortable place we were in because we had raised money, we had just come out of Techstars, but it was not going well. I knew we were going to run out of cash if we didn't figure out something in the next few months. We sent this email literally telling people to go to class for free, thinking, "Okay, this is going to work. We're literally paying for the classes; people have to go."
And still no one went. And that's when I realized we had just gone the wrong direction. I needed to circle back up, I needed to break what we had built, just think a whole new way, re-energize my team around going about solving this problem in a completely new way, not worrying about what we had done but worrying about where we're going to go. That flipped everything.
I have been there now so many times where I've been okay with throwing away our past. People don't know this, but ClassPass has changed its name three times. It wasn't called ClassPass. I've thrown away names, I've thrown away product ideas—we've thrown away a lot of stuff. We've changed our pricing, our plans, and it's because it's not about that; it's about solving the problem in the world and moving towards that in your mission.
So many entrepreneurs though—and this is probably the mistake I made when I was 18 and started my first little tech company—was they get romantic about their initial hypothesis being correct. It's like you've got this square-shaped thing and you're just trying to force it into this triangle because of your ego and there's so much relying on it and you know the runway, you're running out of cash, and you just maybe I'll just push harder. Then all these vanity metrics can be kind of confusing—we've got lots of traffic.
False signals of success, yes.
No one's buying anything but we've got traffic and as you just said, I'm on a magazine. But then certain entrepreneurs I think that have the humility to say, "In fact, it's not about being me my hypothesis being right; it's about creating a product market fit." What was the moment when you started to get closer to that product market fit?
One of the things I love saying about that is to be mission-obsessed, not product-obsessed. I learned that through that journey. But we started then putting this Discovery Pass out there. So what we did learn is that we started finally actually going and talking to a lot of the studio owners and talking to customers. I think one of the things that happens in tech sometimes is you sit behind the tech that you don't go talk to real people.
It was funny because I was in a tech incubator, so we showed up, we were working from like 6 a.m. to 10 p.m. every night but sitting in an office. We weren't actually going to class and talking to studio owners and all of that. So once we started flipping that, we started realizing that a lot of the studio owners, they were offering a free class for people who were new, they want new people in the door.
And then customers, they knew about all these places but they had fear. So we're like, "How do we break the fear?" And so we started building this product, our second product which also doesn't exist anymore; it was called the Passport, and it was a Discovery Pass where you could go and try 10 different classes for 30 days. So you could go to like a spin class Monday, pole dance class Tuesday, dance class Wednesday. It was sort of this way for people for $50 to go and explore. This is sort of when we started realizing the whole love of variety that people had when it came to working out and classes, which was the magic of what we actually discovered in our second mistake of a product: that people loved variety.
How did you learn that?
Well, people started loving this pass. They started loving the 30-day pass, and then they tried to actually buy it over and over again for the next month. And you weren't allowed to because it was like a one-month product; we had literally gotten these classes for no money. It was very much a "do this for a month and then you're going to go find your favorite studio and buy a pass there." We thought it was lead gen for the studio owners, but it ended up not being that at all. People literally were obsessed with the variety, wanted to do it every single month and not stop.
That's when we started thinking about: what if we become a subscription? We weren't a subscription at the time; it was just this one-month product. We then started experimenting with this idea of a class pass. It wasn't even ClassPass at the time; it was a class pass. And we launched it to about 50 customers in June of 2013, and they loved it. The next month it just kind of kept doubling and then it was exponential growth. And I just mean the sales of that took over our other products, and we just knew that the monthly subscription was the way to go and that that was the way that this model was going to work moving forward.
And that's two years in, right?
Three years in. Three years in, so three years of stumbling around. I went to San Francisco in July of 2010, and this is June of 2013.
One of the quotes from your book is about failure being a data point, not an endpoint. I wish someone had said that to me when I was 18 because I saw failure as a testament of my inadequacy or something, as opposed to something I should be listening to. Throughout that period though, how was your mental health? As a founder, something again founders don't talk about a lot.
I sacrificed a lot, especially in those three years where we were trying to get the product right and it wasn't working. I mean, I missed family things, I missed weddings, I was just not around. I was literally at work all day long, and if someone on my team needed me, I gave my 150% to my company. So I felt fulfilled because I was doing something I loved.
Was I exhausted? Yes. Was I lonely? Yes. I mean, I thankfully lived with a roommate who is one of my closest dear friends still today, but she was the only person I would see outside of people at work. I was living in this like closed circuit world, and I don't mind that as somebody who has been on a mission before.
The thing though is, at some point, it's a marathon, not a sprint. The dance shows can be a sprint. That definitely got to me, and one of the reasons I even developed this entire goal-setting method was because three years in—so right when I was at this point where I realized ClassPass was going to take off—I mean, it felt amazing, right? I'd spent like three years, I was so focused, I'd literally probably not talked to anyone in my life, and I found myself alone for the holidays.
My sister was away, my parents were in India, and I was about to literally be by myself on Christmas. It was one of those moments for me. I always hated the holidays as an entrepreneur because it was the one time in my life where I couldn't work through my loneliness or work through any of my issues. It was like the one time where everyone would go and do things with other people, and I would be that person who would finally have to realize that I was on my own because I wasn't cultivating relationships at that point in my life. I didn't have time to.
And so it was a wake-up call. My mom may have been pestering me about it for the years before. At that point in my life, I just started realizing: wait a second, like I knew ClassPass was going to take off. I just knew we only had... we had less than a thousand customers, but I had caught lightning in a bottle. Like it was the... it was so magical. I knew it was going to take over the world. It was one of those moments as an entrepreneur I could breathe.
But I looked at everything else and I'm like, "Everything else is a mess." My health was a mess, I could barely work out (which was crazy for me), I wasn't dancing, I was single, I had a few good friends but I felt like I hadn't been there for them. That's when I started really doing this goal-setting because I'm like, "I need to have a bit more... I want to make sure my priorities are more reflective of the human I want to be in my life."
And how, in a practical sense in terms of a time allocation sense, did you get from that place to living more in line with those values of connection, community, love, and health?
So I... the details of what I did on that session the first time I did it are in the book, but I will say this: so in the next six months after I started doing that, I literally met my husband a month later.
Really?
Yes. I decided to do a huge dance show at Alvin Ailey six months later and I sold out a thousand seats at that. So I got to do a huge performance. I literally changed my perspective around love and what I wanted, and I met my husband a month later, which was crazy. And I also set goals around what I wanted to do with ClassPass, I set goals around my health and how I wanted to live and work out on a daily basis.
And I did all those things. And I remember—this is always my favorite moment—six months later, I was flying home on a plane, and when I first did this goal-setting method I had written it on a post-it note because I was on a plane. I was on another plane ride because I was always traveling, and I took it out and I looked at it, and I had done everything on my dream list.
Sometimes just writing down those dreams is the most important thing, but it was just such an important moment because I felt more—I don't want to say the word balance because that has so many wrong intentions with it—but I felt that I was very clear about my priorities and I went towards them. I missed things too, but I didn't feel guilty about them. I just felt so proud of myself for saying "here's what I want to do in my life and I'm going to go and do it" and accomplishing it, not just obviously professionally but personally as well.
There's like an overarching theme here in your journey where the minute you become intentional about something, the doors open. Do you believe in that manifestation?
100%. And it goes back to having a "why." I think when you don't have a "why," you go aimlessly and you start living life thinking that you want money, thinking you want to be famous, thinking you want power, instead of thinking about like love and passion and purpose. Whenever I have made decisions that are about the former and not the latter, I've never been led in the right direction. If that's something people can take away from this, I think it's one of the most important points is: if you go towards purpose, even if you are rebelling, even if you might be pissing a few people off, I guarantee your life will be more fulfilling.
What were you like as an entrepreneur as a leader and as a manager of people?
I would say I was very much... I had a lot of positive energy. I'm a small human but I show up with all of me. I expect a lot of people. I think because people have always expected a lot from me, so I'm sort of a... when you start working with me, I can very quickly tell if someone's going to sink or swim because I don't tell you a lot but I let you go.
I think to me, that's what I've had to do—is just kind of... I don't want to put a lot of boxes on you. I want you to just show me what you can be at your highest potential. I like giving people that room to be free and then allowing me to see what their capability is versus me saying "you need to be your best in this box that I'm giving you." I've found really great talent in that way.
I've had to learn how to hire for my strengths and weaknesses. That's probably one of the hardest parts when your company grows: you do everything in the beginning and then you have to learn to let go. I've definitely learned that building a tribe around you of great people is the only way to succeed.
You struggled to delegate in the early days?
I've gotten better at it. I've realized that there is no other way to success and to build big things and great things in the world without being able to delegate. So I've become much better at it in my life, and it's the only way I can do what is my magical thing. I've put a lot of thought into that: what part of this company is something that only I know I can do? Everything else that I know someone else can do, I shouldn't be doing.
And is that why you delegated the role of CEO?
Yes, absolutely. At some point a CEO title becomes a lot of managing investors, managing team, doing press. And I was like, "This is not what I want to be doing with my time. I want to be solving the problem, I want to be in with my customers, working on interesting concepts, not spending my day in a bunch of meetings that didn't feel inspiring."
I think everyone's set up differently. You have to know how you work. That's another big thing—is learning the insights of what motivates you. It's the work you do and why you do it that ends up really mattering in any job you're in. I remember there was a point where I remember being so disheartened and not wanting to show up to build my own company. And I'm like, "What is going on?" It was because I hated the work I was doing. I loved obviously my company, but I hated the actual work that I had to do. And so I had to figure out a way to get past that.
When was this?
This was like 2016-17. I mean, we were launching around the world. It was so intense, it was incredible to build that. But I remember I was showing up every day dealing with like HR issues, legal issues, needing to talk to my investors. I wasn't around my customers and I wasn't going to class and around my product, and that's what really fuels me as an entrepreneur and a founder.
Did you have email dread? Like I remember when my company was getting big, there was all kinds of cash flow issues. I used to dread opening my emails. It was like it's going to be some other bullshit from an investor or a contract.
I definitely wanted to make sure that I had more to look forward to, and I think there came a point where I was looking forward to less and less. I think it goes back to what I was saying about: I didn't want my whole day to be like, "Oh, okay, there's like another competitor, okay, we need to worry about this now." I didn't want my days to be about worrying; I wanted my days to be about dreaming.
By the way, you have to obviously as a leader of any of this—it comes with the responsibility. So it's not that I didn't have to worry about those things; there were certain parts of it that I knew I had to worry about, I needed it to be on my radar. But I knew there were certain things where I'm like, "I could hire someone to really work on this and fix this; it doesn't need to take up my time and energy." And that's really where the decision lies.
So all of that passion, all of that love, why did you step away from ClassPass?
You know, I think at some point—and this happens I think for so many founders—I mean, it had been a decade of my life solving this problem, which of course I am so deeply passionate about. And you know, I think the earliest days were when we did the most legwork in actually like figuring out the product nuances that were going to actually unleash the behavior.
I think it just got bigger, you know? For me, I think there are other things I want to do in the world. And there's probably other problems in the world I still need to go and solve, and it's on me to unleash myself to be able to face them so I can move forward towards them and have them even come into my periphery. I think if you're kind of stuck in the past, you don't even welcome the doors that you need to go through to reach your future. And I know for me my future is waiting for me. And it's on me to sit there and walk through the door and go towards it.
And was there a feeling of like a loss of love?
Yeah, I mean, it's a bittersweet moment. It's super bittersweet, right? I always say the hardest day was when I stopped getting my ClassPass email. I mean, think like it was insane; I've had this email for years. It was like my main inbox. And you know, it was definitely a sense of loss. I mean, I think it's for... it's like having a child and watching your child get married. But it's also being able to say they're okay. I did all I could to get them to this point and being proud of that. And that's really where I'm at.
I remember that when I resigned from my company, it went public and I said to the company, "I'm going to resign, but I have one caveat." They're like, "What is it?" I was like, "I want to keep my email." I still have my email.
You know, it's funny that you say that. I think I didn't, going back to the whole... it was just been more noise for me. I think it was a nice break for me. I actually remember creating a new email address and it was like "no mail" and I'm like "What?" and you know, it was interesting because it started making me realize: what do I want to fill that part of my life up with?
What's the answer?
What's the answer to that? I'm sort of in the middle of it still, but you know, obviously lots of dance. You know, I think I probably have a few more big problems in the world to solve. I'm only 39. It's interesting because I'm young. My mom and I always talk about this too, and she's like, "It's interesting because yeah, like I could retire, but there's no part of me that would ever think about that."
The valuation of ClassPass at sale is probably confidential, but I know that in 2020 in the Series E round it was valued at over a billion. It's a lot of money. How does that change things for you?
We haven't exited, so like the company hasn't been sold yet, so it's still private. But I think the reason why that was such an important moment was because of what it... the message it sent for women, especially and me being an Indian woman. Like that was actually the most important part of it. I don't think as an entrepreneur you should run towards numbers like that because what you should run towards is making an impact. The 100 million hours of people's lives is actually much more impactful to my business and society than hitting that billion-dollar valuation. But in my case, I think it's different because I know what that represents to so many other girls out there who can look at something and say, "Wow, if she can do it, maybe I can too." And that to me is a really important part of it.
Your partner and your son, Nick and Zayn. How's that been? You talk about the obsession you've had building ClassPass. Entrepreneurs always struggle in managing their romantic relationships and the other part of their life. What advice have you got for me on maintaining a good romantic relationship and family whilst also striving to build big dreams?
Yeah, and I'll be honest: I think we're all always still learning in the process of it. But I think one of the biggest things I learned is bring them along on the journey. Nick was with me through so much of it. I mean, when we went to launch London, me, one of my co-founder and one of my sales girls came and so did Nick. And we had to go try out about 30 studios in London in about five days, and Nick just went and did some of them too.
It was amazing; we all just went and worked out and he was sort of like checking out studios. He would come to Australia with me, come to London with me, and he was just a big part of the process. I think that's so awesome that he got to live the dream with me. I think as we've had a kid, we've just had to become very clear on priorities. He is a partner at a law firm, one of the youngest partners at his law firm. It's insane what he's been able to accomplish in his career.
So we have to just always be very, very communicative on what we both want in setting goals in "hey, like what do we want to accomplish this year in terms of our lives?" The same way I think about it personally, we have to think about it in terms of what our family wants to do—whether it's school, whether it's traveling. What do we want to make sure we both do as a family unit combined with our jobs and our ambition? I think it's so important, especially for women, to surround themselves with partners and people who will constantly help them stay ambitious in their life because it's one of the hardest things.
What if there's conflict between what the family wants to do and what Payal wants to do in terms of your ambitions and then his ambitions with his career?
You have to talk it out and come up with a plan. To me a plan is the most important thing. And sometimes there is conflict, but you have to try new things similar to pivoting and iterating like on a company. You sometimes both people have to be flexible to be like, "Okay, well like if this current situation isn't working we're going to try something new, right?"
"Okay, like you want this, I want this; what if we try a combination of this for six months?" You just have to be flexible and adaptable. I think the biggest mistake is not doing anything and staying sort of stagnant in a place where someone's uncomfortable or someone's not happy and not helping the other person. At the end of the day, Nick being happy in his life is going to make him the best husband to me and the best dad, and me being happy in my life is going to make me the best mom and best wife to him. We both know that, so it's about saying "what does happiness look like to us individually but then us together as a family?"
Your journey has weaved and up-down, left-right, all of it. It's been a tremendous roller coaster with so many highs and lows and everything in between. You spoke earlier about the importance mentorship has played in your life. Have you ever been to therapy?
I did a little bit of therapy actually at the beginning of last year. You know, I had a baby six weeks before the pandemic and then my company came to a halt. It was just a really crazy time, so I had just gone to therapy to just start talking to somebody because I didn't even know how to make sense of so much of where my mental state was at that point.
I hadn't seen people; I'd literally been a mom for a year living at home. It was just an... my life was so different than it what it looked like pre-pandemic at that point. And so yeah, I have and I recommend it to anyone. It's sort of like a fitness instructor who works on your body; you need to work on your mind sometimes and see what your roadblocks are. We know them like "oh my god, I feel I don't feel strong with my left arm," like how do you get that stronger? We sometimes have blocks like that too.
It sometimes is—for me it's been like—sometimes there'll be a feeling which I can't... where you just know you're out of orientation or something's not right. I think the pandemic did that to a lot of us which destabilized our us in many, many ways. Your journey is phenomenal. It's really, really phenomenal and you're a really phenomenal person for so many reasons. One of the reasons why is just you're just this—from the minute you walked into this room—you're just this like ray of sunshine.
Oh thank you.
And that's why I think I asked the question about therapy in your hard moments in particular because you have a just... an unbelievable smile and you have such an... I'm like "is this person always this..."
But it goes down to... I always believe there's the light. I think the question you started with: it was I just believe there's like goodness to give and service and purpose. And when I'm not aligned with my purpose I do feel sad. Those are my like hardest moments where you know if I didn't care about sharing my insights and stuff I could be someone who wasn't happy, but I do things intentionally and therefore how can you not be happy doing the things that you love in your life?
So beautiful. We have a closing tradition. The previous guest writes a question for the next guest and they don't know who they're writing it for. What is one thing you would do if you weren't afraid at all?
You know, it's interesting. I... like mentally, I don't have many things that I don't feel like I could solve. So it's like not mental. I probably have more physical things because I'm such a small per... like I'm four-eleven, right? It's like the... it's an interesting thing because I feel more physically fearful of things than I do... Actually, you know what I would do? I would run a marathon.
Interesting.
And I love running. I just have never run that many miles.
Are you afraid?
I'm not probably not afraid, but potentially I'd have to work through what's holding me back from it. But maybe there is some fear.
I'm going to pay attention, see if you end up running a marathon. Thank you so much for your time and your wisdom. You're such a breath of fresh air for so many reasons but you're a real source of inspiration and what you've accomplished with ClassPass is just astounding. And your like humility and openness to share the truth about that, not just in the book but here today is going to be liberating for a lot of people.
And the whole... you know, one of the key lessons I come away with, even though I feel like I might have said this if you'd asked me, is just the unbelievable importance of having and following that voice inside of us which is there and all the reasons we suppress it because of external whatever, whatever. As I was sitting there as you were talking I was thinking: you know what as well, the other thing is like even if you try and do something else, whether it's management consulting, whatever, you're never actually going to master it because it's always going to be a tedious job. Whereas you ended up mastering the thing that was in line with your passion, and I think that's a really important lesson to everybody who feels like they're in a situation now that might not be in line with that voice inside.
Right. Be the master of you. Amen.
You're brilliant. Thank you so much for your time.
Thank you. Thanks for having me, Stephen.
Paying extra for tire care is BS. You know, bad service. So at Midas, we're rolling out our BS-free tire guarantee. Included with paid installation and tax on every purchase, you'll pay nothing for flat replacements, nada for flat repairs, and zilch for tire rotations every 5,000 miles. That's zero dollars for all that. So with this limited lifetime tire guarantee, you'll pay a whole lot of nothing compared to what the other guys charge for tire care. That's the BS-free tire guarantee, only at Midas.