Two things: What’s ever gone on in a room between founders and VCs is something I’ve only been able to imagine. More to the point, the world of startups can feel veiled, like an exclusive club frequented only by Stanford darlings, Y-Combinator wunderkinds, and overly confident, ex-McKinsey consultants whose MBAs make them think they’ve got what it takes. So it’s nice to get a peek at some real examples of how a company which grew to be a household name pitched itself at the earliest stage. I’m totally stealing this post idea from Nick Gray, who came across these slides by way of Motherboard, who originally offered these slides in the form of a legal filing. I’m also creating this post to make myself parse the information herein. Also, go read Nick’s blog and sign up for his newsletter; he does some cool stuff. A Bit Of Peloton Background Before seeing these slides, I had never delved into the who/what/when/where/why of Peloton. I’m not setting out to write an investment memo here, but I was wondering about the basic background of the company. So here are the basics. (If you want to get to the slides, do skip ahead). Peloton was co-founded by John Foley, Tom Cortese, Hisao Kushi, Yony Feng, and Graham Stanton. John Foley has served as the company’s CEO since its inception. Before starting Peloton, Foley had leadership roles at various tech and e-commerce companies, including senior roles at IAC, serving as CEO of Pronto.com, and serving as president of Barnes & Noble. Foley and his wife loved boutique fitness classes, but found it difficult to attend them regularly given their busy schedules. This led to the idea of bringing a high-quality boutique fitness class experience into people’s homes. Tom Cortese served as the COO and was instrumental in building the company’s technology and operations from the ground up. As of 2023, he is the Chief Product Officer. Hisao Kushi served as the company’s Chief Legal Officer. Yony Feng was the CTO, focusing on building the company’s software and hardware platforms. Graham Stanton took on various roles, including focusing on growth and user engagement. Foley, Kushi, Feng, and Stanton have since gone on to found DTC rug startup Ernesta. Peloton Pitch Deck Slides These slides are the original slides from Peloton’s very first pitch deck in 2011. Ever have trouble deciding on a business name? It’s okay. “Peloton” was a place-holder. Best of all worlds: working out with others, an instructor, and a fancy spin bike. Put another way: being guided by an expert in a fun, healthy activity, in a pro-social way. There’s low cognitive effort up front (read: you don’t have to worry about workout programming), real time social proof and motivation, and just pure fun in the mix. I’ve lived most of my life in the greater NYC area; the spin boom was very noticeable, even at a casual glance. Being a fitness instructor was never quite something to boast about…unless you were Jane Fonda. Interesting how the Peloton peeps identified and incentivized a dynamic here. Performance on part of the users was framed as something to gamify, too. (p.s. lil typo in there, eh?) The music industry is a mess that I don’t understand, and I wonder how much trouble Peloton ran into when it came to securing rights to songs, or how much they had to pay. A screenshot of the app which shows classes that are live, or going to go live soon. The UI is obviously minimal, but it does the job! A screenshot shows a “My Friends” view – complete with a “Join Class” button – intended to let a user see which friends are riding, and allow them to join. Right away you can put yourself in a user’s shoes, imagine a spike of interest upon seeing your friends in a class that you can join with a mere tap. Funny how motivation as an adult can look a lot like that on a playground – we often want to do what our friends are having fun doing. Presumably a preview gallery of Peloton instructors…I like the mishmash stock photo vibes here. A screen which shows data including work and power units, as well as viewership overlayed atop each instructor. An additional screen shows a leaderboard in the top right. Simple gamification seemingly went a long way. Here comes the market data. As of 2022, the global market for physical fitness equipment was in excess of 16B, so the above information tracks. Mr. Wonderful voice: “Do you own the patent for this?” This slide lists – or hints, i.e. “let’s talk” – at all of the things that can be considered proprietary. This slide depicts “Phase 1,” integrating proprietary software with off the shelf hardware. This slide depicts “Phase 2,” whereby custom hardware is developed/introduced. This slide depicts Peloton’s R&D setup for prototyping and iterating quickly. Gotta go fast! That’s all!