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The ClassPass Paradox: Partner or Competitor

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Stephen TharrettStephen Tharrett

Over the past year, ClassPass, an online subscription portal that extends consumers the opportunity to engage in unlimited fitness classes a week at over 3,000 studios, has gone viral, capturing the attention and engagement of numerous club/studio operators. With its announcement earlier in 2015 that it had raised $40 million in Series B funding, bringing its total raised to $52 million since launch, its Founder and CEO, Payal Kadakia, indicates the company now has a market cap of approximately $200 million and growing.

One could say that ClassPass is the Cinderella story of the fitness industry, not to mention one of the tech feel-good stories of the year. Accompanying its incredible success in the financial markets has been its equally successful enrollment of clubs and studios across the country. Presently, ClassPass has enrolled over 3,000 studios and clubs in over 33 markets and booking over 1.5 million reservations a month according to a February article that appeared on Those numbers are likely to grow significantly as it pursues its goal of being in at least 100 markets in the next year. At the most recent IHRSA Convention in Los Angeles, ClassPass was all the rage, garnering a significant amount of buzz.

Mark WilliamsonMark Williamson

The Benefits and Risks of ClassPass

Like any innovative new business model that promises to be your partner in success, it's worth the time to assess the benefits and risks. In this white paper, we will explore the ClassPass story, what it offers the club and fitness studio industry, what possible hidden risks are and stories from other similar business models that can possibly shed light on what ClassPass can mean to the future of a studio or club.

What is ClassPass?

According to its Founder, Payal Kadakia, ClassPass is a monthly membership offering that extends consumers a unique opportunity to work out at multiple clubs and studios, and for operators, brings them enhanced market awareness and traffic. At its core, ClassPass is an online portal (website and mobile application) where consumers can subscribe for $99 a month and gain the ability to reserve space in an unlimited number of classes a month (initially capped at 10 classes a month) at multiple clubs and studios in 33 markets across the country and internationally. By purchasing a membership subscription for $99 a month, a consumer can go online and reserve a spot in a class from among various clubs/studios (e.g., barre, dance, Pilates and yoga) in his market who have enrolled in the program. The only caveat for the consumer is that he is limited to three visits at any one particular studio in a month.

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