Ep. 561 - FAN FAVORITE | Mindbody Former President & CTO Sunil Rajasekar - How To Build a Legendary Culture Now

Summary

Podcast Summary

Second in Command with Cameron Herold

Episode 561: FAN FAVORITE | Mindbody Former President & CTO Sunil Rajasekar – How To Build a Legendary Culture Now
Date: March 12, 2026
Guest: Sunil Rajasekar, President & CTO, Mindbody
Host: Cameron Herold

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Episode Overview

This "fan favorite" episode revisits one of Second in Command’s most impactful conversations, featuring Sunil Rajasekar, President & CTO of Mindbody. The discussion covers scaling a purpose-driven tech business, building enduring corporate culture, avoiding burnout, the impact of COVID-19 on wellness, attracting and retaining top talent, and the evolution of the Mindbody platform (including the acquisition of ClassPass and the launch of Mindbody Capital). Sunil speaks candidly about career lessons, intentional leadership, company transitions, and synergizing teams through mergers.

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Key Discussion Points & Insights

1. About Mindbody: Platform, Mission, and Global Reach

• Two-Pronged Platform:
  • B2B: Comprehensive ERP-style software for wellness businesses (gyms, salons, etc.) to manage appointments, staff, payments, marketing, and now capital.
  • B2C: Marketplace app for consumers to discover and book wellness services internationally.
• Organic Global Adoption:
  • Offices in the US, Australia, UK; product used in almost 100 countries—spread driven more by customer demand than direct expansion ([02:31]).
• Multilingual Support:
  • Mindbody supports multiple languages, an early priority ([03:13]).
• Personal Connection to Mission:
  • Sunil felt drawn to Mindbody for its larger mission: “being able to connect the world to wellness” ([04:15]).
  • Belief that access to wellness should be universal, “not exclusive” ([06:17]).

2. Sunil’s Burnout Story & the Role of Wellness

• Early-Career Crisis:
  • Sunil recounted flaming out in his 20s due to relentless work, social life, poor self-care ([09:10]).
  • “I thought I was invincible … my body told me I wasn’t.” ([09:23])
  • Led to severe health consequences (IBS, major weight loss, forced sabbatical).
• Turning Point Book:
  • "The Mind Body Connection" by Dr. John Sarno resonated powerfully and catalyzed new wellness routines: daily meditation, exercise ([10:42]).
  • “That book was a game-changer for me and helped me get back on a good path.” ([10:50])
• Shared Experience:
  • Host Cameron relates his own stress-induced IBS and redlining ([11:42]).

3. Career Journey & Leadership Lessons

• Why Mindbody Hired Sunil:
  • Authentic motivation, relevant cross-marketplace experience (enterprise, SMB, consumer tech), personal culture fit ([12:41]).
• CEO Transition:
  • Transition from founder Rick Stollmeyer to new CEO Josh; strong pre-existing relationship with Josh made it smooth ([14:23]).
  • “It felt very natural… a continuation of what we had already built.” ([14:57])
• Advice to Younger Self:
  • “Don’t burn out.”
  • “Don’t forget to have fun and be grateful… Live in gratitude.” ([41:54])
  • Sunil’s daily gratitude exercise: mentally listing blessings every morning ([42:00]).

4. Scaling Product & Business: The Tech Behind the Scenes

• Product Sophistication:
  • Outward simplicity (“applesque” UX) masks deep backend complexity; 20 years of accumulated features, legacy systems integrated with new ([15:48]).
  • “There’s a lot of complexity underneath the covers” ([15:50]).
• Pivotal Moments in Company History:
  • Early cloud adoption pivotal to scaling and accessibility ([17:12]).
  • New chapter: acquisition of ClassPass, expanding consumer options ([18:55]).
  • “We are going through one pivotal moment now… We just announced the acquisition of ClassPass.” ([18:55])

5. Business Model, Revenue, and Market Position

• Revenue Split:
  • Approx. 70% B2B, 30% B2C, especially post-ClassPass ([19:36]).
• Market Leader Status:
  • “We are the most full-featured platform… most market share” ([21:26]).
• Business-in-a-Box Vision:
  • Aim to streamline so wellness entrepreneurs need just one platform, similar to Uber’s “plug-and-play” approach ([23:18]).

6. Innovations: Mindbody Capital and ClassPass

• Mindbody Capital:
  • Provides cash advances based on future revenue—no application, no credit check, fixed fees; fills key funding gap for small businesses ([25:04] to [27:04]).
  • “It’s a cash advance based on your future revenue... There’s a fixed fee no matter what” ([26:05]).
• ClassPass Acquisition:
  • Synergy between DTC (ClassPass) and B2B (Mindbody) to expand consumer access and business growth ([36:11]).
  • “We are approaching it with a different lens—help these SMBs... that’s who we are going to continue serving.” ([38:44])
• Merger Approach:
  • Blending teams where efficient (e.g., finance), but integration guided by what best serves accelerating business value ([39:53]).

7. COVID-19: Challenges, Resilience, and Industry Creativity

• Severe Impact:
  • COVID shut down nearly all Mindbody client businesses overnight ([32:17]).
  • Leadership managed by focusing on customer and employee fears, operational pivots.
• Industry Resilience & Creativity:
  • Clients began outdoor, virtual classes; Mindbody quickly launched virtual class platform in response ([33:23]).
  • “Wellness isn’t optional… It’s at the same level as education and healthcare… People find a way” ([34:10]).
• Growth Outlook:
  • Predicts post-COVID boom for wellness: “We’re not just going to rebound… it’s going to be much higher than pre-COVID.” ([34:55])

8. Talent Wars & Culture

• Attraction/Retention Strategies:
  • Competes against tech giants by emphasizing mission-driven work: “missionaries, not mercenaries” ([30:12]).
  • Acknowledges some attrition, but strong talent remains due to belief in mission ([31:42]).
• The Importance of Culture:
  • Discusses building a multigenerational company and legendary culture through shared purpose ([06:17], [31:42]).

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Notable Quotes & Memorable Moments

• “All of us in tech want to do interesting work... but we also want to have big impact. Mindbody gives me—and us—the opportunity to do meaningful work.” — Sunil Rajasekar ([04:15])
• “Wellness… should not be exclusive. How do we make that available to all 7.7 billion people in the world?” — Sunil ([06:17])
• “When your mind doesn’t know you’re heading down the wrong path, your body will tell you… that’s what happened to me.” — Sunil ([09:23])
• “We attract missionaries, not mercenaries—and that plays to our favor.” — Sunil ([30:22])
• “You can do both: be a badass in business, go after aggressive goals…and also be empathetic and kind, like Buddha.” — Sunil ([43:19])
• “Don’t forget to have fun and be grateful. Live in gratitude.” — Sunil ([42:00])
• “Wellness isn’t optional. It’s at the same level as education and healthcare… people are going to find a way.” — Sunil ([34:10])

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Timestamps for Important Segments

• Introduction & Guest Overview – [01:13]
• Mindbody Origin, Mission & Sunil’s Motivation – [03:38]
• Burnout & Personal Wellness Journey – [09:10]
• Leadership Transitions & Culture – [14:23]
• Product Complexity & UI Philosophy – [15:48]
• History of Mindbody—Cloud/Marketplace Evolution – [17:12]
• ClassPass Acquisition – [18:55]
• Business Model & Revenue Split – [19:36]
• Uber Analogy & Business-in-a-Box Vision – [23:18]
• Mindbody Capital Explained – [25:04]
• COVID-19’s Toll & Adaptive Leadership – [32:17]
• Post-COVID Growth Vision – [34:55]
• ClassPass Integration Approach – [36:11], [38:44]
• Talent War & Retention – [30:12]
• Advice to Young Sunil & Gratefulness Ritual – [41:54]

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Tone & Takeaways

With humility and candor, Sunil details both personal and organizational challenges—offering actionable insight on leadership transitions, surviving and learning from burnout, and architecting scalable, missional company culture. The conversation balances strategic business analysis with philosophical reflection, echoing Mindbody’s ethos: “Connecting the world to wellness.” Listeners gain a window into how legendary companies are built—through resilience, purpose, and a refusal to separate wellbeing from workplace excellence.

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Transcript

[A]

Just a quick note before we dive in. This is actually one of our older episodes, but we're bringing it back because it's one of the most downloaded ones we've ever released. Clearly it struck a chord with a lot of listeners and I know there's so much value packed inside. So whether you're hearing it for the first time or revisiting it, enjoy this

[B]

fan favorite advice number one would be don't burn out. Yeah, I wish somebody had told me that I wasn't invincible. I don't know if I would have listened, but I wish somebody had told me that. I think another thing would be I don't forget to have fun and be grateful and live in gratitude and something that I've tried to do ever since I burnt out and I try to do it to this day. You know, I have a gratefulness exercise that I do every morning where I spend time thinking about all the blessings I've been given.

[C]

Welcome to the Second in Command podcast, produced by the COO alliance and brought to you by its founder, Cameron Herold. In the second in command podcast, we talk to top COOs who share the insights, strategies and tactics that made them the chief behind the chief. And now, here's your host, Cameron Herold.

[A]

Our guest today is Mindbody Inc. S President and CTO, Sunil Rajasekar. Sunil has served as Mindbody's Chief Technology Officer since November 2018 and and as its President since August 2020. With more than 20 years of consumer and enterprise experience, his work is focused on the company's products and technology strategy, consumer marketplace expansion and platform development. Previously, Sunil served as Vice President and General Manager at e commerce giant eBay, leading engineering and product management for the seller experience. He has also served as Chief Technology Officer for Lithium Technologies and is Vice President of Engineering, Product Management of Operations at Intuit. He holds his MBA from the University of Toledo. Sunil, welcome to the Second Command podcast.

[B]

Thank you, Cameron. Happy to be here.

[A]

Yeah, I'm really excited to do this. Strangely enough, I've used your app in a number of countries. I was recently over in Italy and we were like, where the heck are we going to find yoga? And my fiance was like, well, let's just go on mindbody. I'm like, you're not going to be in Italy. Yeah, you are. And it was like dead simple, super clean. We show up and. And the first thing the woman even said to us when we walked, like, did you use Mind Body to book us? Like, yeah, this is just amazing. How many countries are you guys in.

[B]

Now, we are in a lot of countries, so we actually have offices only in a few. So we are obviously in the US we have offices in Australia and the uk, but we are actually used in a lot more countries than just the countries that I mentioned. And it's usually customers finding us on the web and wanting to use a software, wanting to be on the marketplace. So I couldn't even give you an exact count because it's not something that we've been actively pursuing. It's all happened organically, but I would say it's probably close to 100.

[A]

Wow. It's amazing. Are you covering multiple languages and stuff on the platform or is it all just English?

[B]

No, we do have multilingual support, so that's something that we build in. We built in quite early.

[A]

Okay.

[B]

And that's. That's data.

[A]

Amazing. All right, what was it that got you to. To join mindbody? And then after you tell us that, can you just give us a walkthrough as to what mindbody is for anybody who hasn't heard of it yet?

[B]

Yeah. So Cameron, if you're okay, maybe I'll do that in reverse because why I'm here is tied very directly to what mindbody does.

[A]

Please.

[B]

So mindbody is the world's leading platform for the wellness industry. So we have two pieces to our overall platform. One piece is the B2B software. So this is software that a wellness business can use to run and grow their business. So think of it like a ERP type software to run a wellness business. So this allows these wellness businesses, whether they're in fitness or integrated health, or whether they're a salon or a spa, it allows them to set up their classes or set up appointments, take online bookings from their consumers, set up their staff, run marketing campaigns, and we've continued to add more and more functionality. So we just recently launched mindbody Capital, which allows these businesses to use a platform to raise money to run and grow their business. So that's just an example. So we're continuing to add more and more functionality to our platform. So there's everything from software you need to run and grow your business, engage with your consumers, raise capital, manage your payments. So it's really fully function. So that's one piece. Then we have the Marketplace, which is what you were just referring to, that you used in Italy. Thank you for using our software. Feel free to use more of it. And this is a direct to consumer play where we have a marketplace by consumers who, whether they're traveling or they're new to the wellness industry and they want to look at what options are there in the neighborhood. They can go to a marketplace and it's in, you know, it's available on the web. It's also a Apple iPhone app or a Google Android app. You can use that app to go do a search, find whatever you're looking for, and then go ahead and book and purchase as well. So we have these two pieces. Of course, they're all integrated. It's part of one giant platform. But I would break it out into those two pieces just to explain how it works at the next level. And then now talking about why I'm here. So, you know, I've been in Silicon valley for over 20 years and, you know, we, all of us in the tech industry are lucky to be here at this time. There's no dearth of opportunity and it's true for everyone in tech. And it was true for me as well. I came to mindbody for three reasons. Reason number one, and probably the biggest draw to me was the space that we're in. So everything that I mentioned, right, the idea of being able to connect the world to wellness was very, very appealing to me because we all want to do great work in the fields that we ran, but we also want to have a big impact. And Mind Body gives me and the rest of the company the opportunity to do meaningful work, to do interesting work, to work on marketplaces and on AI and now and all these interesting things, all in service to connecting the world to wellness. And that was very, very appealing to me. Wellness, personally, is something I focus on quite a bit. I blamed out, I burnt out early in my career and I ended up pivoting my focus. This is when I was in my early 20s to wellness quite a bit. I realized that I didn't have an anchor point. And the shift to wellness was personally very, very meaningful to me. And I started meditating every day. I started working out. I'm not the one to lift 500 pounds at the gym, but I still go and I do yoga, I work out and all that's become a very integral part of my life. So the idea of doing that at scale and helping others discover wellness. Reason number one, strongest reason. Reason number two is we have an opportunity to build a multigenerational company in the wellness space, right? The way I look at wellness, it's at the same level as health care and, you know, and education. To me, the whole world should have access to wellness, right? And that's not the case today. There's very. There's a very small percentage of people who get to experience wellness, you know, go to classes and, you know, get a personal trainer. But it really shouldn't be exclusive. Right? How do we make that available to all 7.7 billion people in the world? So to me, that's a big mission and there's good for the world that comes out of that. And out of that we have the opportunity to build a multigenerational company that's at a Google level or a Facebook or Amazon. So that opportunity was very, very appealing as well. And then the third reason, and I think this is a byproduct of what our mission is, which is connecting the world to wellness, is that the people who work at the company are different. They have focus on wellness and they're motivated by that mission. So it's not just about, hey, what do we do for the next quarter, it's about what can we do to further our overall mission, the people that work at the company. So those are the three reasons.

[A]

That's amazing. I want to go back to something you said about flaming out with stress 20 years ago. Our timing on this is interesting. I was written up in the Wall Street Journal in the fall of 2020 as someone whose career flamed out because of stress. And I was clinically redlining. So I'm curious, what happened to you? What happened and what were the signals or the symptoms that you saw? Now, maybe you didn't see them at the time, but that you can tell others to be aware of?

[B]

Yeah, yeah. So this was in my early 20s. I was living in New York at that time. And when you're in your early 20s, you think you're invincible, right? You can do whatever you want and you're going to be fine. So I had a high pressure job. I was working at Oracle and I was working crazy hours. And then I also had a lot of friends and having fun was a priority too, right? It is for most people in their early 20s. So I was trying to do it all. So I would work crazy hours, I would work on the weekend, then I would go out every night with friends and it wasn't really taking care of myself, wasn't watching what I eat. And then a lot of times, even if your mind doesn't know that you're heading down a wrong path and you're burning the candle at both ends, your body will tell you. If your mind doesn't tell you, your body will tell you at some point. And that's what happened to me, Cameron. My body Told me I ended up just breaking down. The stress was too much. I had irritable bowel syndrome. I ended up losing a lot of weight and I ended up needing to take like four to six months off just to recenter myself and come up with a new system for, you know, how I, I needed to live. So I wasn't, you know, flaming out. So it took me a while to figure out that was a book I read at that point, which was a turning point for me. Coincidentally, the name of the book was the Mind Body Connection by a person called John Sarno. And it talked about, and the book was about back then.

[A]

I know John. Yeah.

[B]

Have you read the book?

[A]

No, but I know John. I've met him at a genius network event and he's talked a lot about his concepts for us.

[B]

Oh, is that right? Well, I would love to meet him because this book was, you know, a, a game changer for me and helped me get back on a good path and really recover. Because there was a time where I was like, I don't know if I'm going to come out of this. You know, I was seeing a lot of doctors and they basically said irritable bowel syndrome means we don't know what's wrong with you, so we don't know how to fix it. We can give you some high level tips and guidelines, but yeah, we basically don't know how to fix it. It's your nervous system basically being out of whack.

[A]

Yeah.

[B]

And John Sarno's book was the one that told me that the thing that causes that is the mind body connection and it's stress. And that's what got me going down the path of meditating every day and you know, just recentering myself and working out and taking care of myself. Overall,

[A]

I had the irritable bowel syndrome stuff as well. And very, very similar, like long hours, crazy days, drinking, partying every night, waking up at 7, doing it again and thinking I was invincible. I weighed 40 pounds heavier than I do today, which was like I was not a good look. So. But did you have that kind of metallic taste or something at the back of your neck? Does that ring a bell to you at all?

[B]

No, I did not have that symptom. I don't know, I couldn't keep anything down.

[A]

I don't know how to explain what it was, but it was almost like at the back of my neck I had this like, almost like I was chewing on tinfoil or something. And I talked to a physician about it and he Said, he told me, he said, you're clinically redlining. Your body is secreting something to tell you to slow down.

[B]

Wow.

[A]

Yeah, Scary stuff. All right, so you join Mind Body. What do you think that they saw? And was it Josh and the board hiring you or Josh and the leadership team? What did they see in you that they wanted to bring you in?

[B]

Yeah. At that time, Rick Stollmeier was the CEO. He is the founder of the company. He stepped down around a year, a little more than a year ago, and Josh took over as CEO and I took over as president at that time. So he's the one who was my hiring manager. And yeah, the board was involved as well. I don't want to sound too presumptuous, but I suspect that the reasons why they thought I was a good candidate, one was I was very open about my personal motivation for seeking this role. That was number one. Number two was the experiences that I'd had. You know, I've been very conscious about building out, you know, my experiences. You know, I've worked in, yeah, in the consumer space. I've worked in enterprise, I've worked in the SMB space and all of that. I've worked in marketplaces and all of that was directly relevant to what mindbody was trying to do. We have really large enterprises that we serve like Orange Daily Fitness and F45. These are, you know, really large companies. And then we also have a lot of SMBs, small, medium sized businesses that we're serving. Then we have a marketplace. So I've worked in all those spaces. So there was a lot of direct applicability between my experiences and what mindbody was trying to do. And on a personal level, I clicked with everyone that I met. So I think those are the three reasons.

[A]

Makes total sense too. How is the transition then when you come in under that first CEO and then you have a second CEO coming in two years later, how was that transition for you and what do you think you learned or how did you have to adapt?

[B]

Yeah, so Josh came into mindbody through an acquisition. So he was CEO of a company booker, which got acquired by mindbody. So he was already at the company when I joined and he was the chief strategy officer at that point. And he and I had built a deep relationship even during that time when Rick was this neo. And, you know, Josh does a really good job of building out personal relationships, you know, even before, you know, you start leaning in on the work relationships. So we used to spend a lot of time, you know, just grabbing a drink or grabbing a coffee. So we ended up becoming friends and in addition to just being colleagues, so that base was there. So when Rick stepped down and we stepped into our new roles, it felt very natural because we already had that, you know, that. That relationship. And it didn't feel awkward or unnatural. It felt in many ways like a continuation of what we had already built.

[A]

Interesting. All right, so on the. On the B2C side with Mindbody, as a consumer, you know, booking yoga or fitness classes or spin classes or whatever, it's a very clean experience. It's very kind of applesque in terms of its usability. Clean, simple, fast, and easy. Is the backend as clean or is the back end kind of messy? And you guys are really making it look good, but is it tough on the back end or have you really got it dialed?

[B]

Cameron, the reason you're asking this question leads me to believe you know the answer. No. No, it is not that easy. We have a lot of complexity underneath the covers, and the reason for that is our platform, mindbody has been in business for 20 years, right? So as part of that, we've been building features and products and capabilities over the past 20 years. So there's a lot of complexity there. A lot of complexity comes from we're building out these modern experiences, but there's also some parts of our platform that are older, and how do we make all of that work together? And a part of our platforms are super modern, like the marketplace that you're using. Thank you for saying that. It's very applesque, and Apple sets the gold standard when it comes to ease of use. And there's a lot of work that's gone into that. But underneath the covers with the APIs and talking to the different systems, and there's a lot of complexity.

[A]

It's interesting. I actually had that question done, is how many years has it been in the making? When I was the COO for 1-800-got- junk, people used to think it was such an easy business. I'm like, you have no idea how long it took to get to the night before we were the overnight success story. So when did. When did mindbody become that overnight success? Is it like three years ago, four years ago? Was it while you were there or just before or just after?

[B]

I would say there have been different phases for the company, and given how long we've been there, there's been multiple phases. I would say, you know, and I've spent a lot of time with Rick, and, you know, there's a lot of folklore even within the company on all the stages that we've been through. I would say the first pivotal moment for the company was when mindbody adopted cloud technology. At that point, everything was like desktop and on prem software. And then Rick, to his credit, made a decision that. And this was very, very early, before Salesforce was a thing and you know, now cloud is the default, but there was a time when it wasn't and he said, you know, talking to others in the industry and others within the company that hey, we need to adopt cloud technology and move into the cloud. And that was, I think when the business really took off because it made it really simple for people to discover mindbody and to install mindbody and to start using it. Yeah, that was, that was like a key moment. Other moments when the marketplace was introduced. And then I would say we are going through one pivotal moment now. We just announced the acquisition of ClassPass, which is a direct to consumer subscription solution so people can subscribe to ClassPass and it gives them access to tens of thousands of wellness businesses and so they can use the credits that they purchase every month to go to any of these businesses.

[A]

So are you guys VC funded right now or do you have funding?

[B]

Yeah, so we were VC backed and then we went public and then we took the company private. So at this point we are owned by Vista Equity Partners so we are febacked. We, we have other investors as well, but Vista is the, the majority investor.

[A]

Okay, so you guys are really starting to scale again. Amazing acquisition to just do that class pass one on. On the B2B side. I didn't realize that mindbody had that full B2B empowerment for all of these locations. What's your revenue split in terms of percentages? What percentage of your revenue Approximately would be B2B and what percent is B2C?

[B]

Yeah, with classmates as well. I would say directionally it's probably 70, 30, 70 B2B. Correct.

[A]

Yeah. It's interesting. I, I didn't even know that existed, but now it makes perfect sense. One of my former clients and a member of our COO alliance, they have a. A company called Loud Rumor and they do a lot of marketing for fitness locations. Like F45 is a client in Orange Theory. They, they can do a lot of their outbound marketing. But. But these, these locations really do need this software to actually manage and run their business and platforms. I didn't realize that you did that. Is it clear to like in the fitness space that that is your, your niche? Like did they all know that, Hey, it's Cameron, Herald your high energy leadership guru here to pump you up on the Second in Command podcast. If you get frustrated because your managers aren't leading like you want them to be, check out my game changing leadership [e-mail] that's investinyourleaders.com for just 347 per liter you get 30 years. My proven experience straight from taking 1,800-got junk from 2 million to 106 million as COO and it's packed with 12 easy modules. Learn situational leadership coaching, delegation, conflict management and more all in under six [e-mail] with straight to the point videos, worksheets and real life scenarios, your team will master time management, be able to hire a players and get aligned with your vision. It's all backed by a 30 day money back guarantee and raved about by hundreds of CEOs and thousands of managers already learning from the content. Grab this now and watch your business soar.

[B]

Yeah, so we are the, you know, the most full featured platform there is and we've been in the market the longest, we have the most market share. So I would say people view us that way. But what they probably don't all know is how much we are focused on this mission of building out, you know, a fully featured platform. Because our goal is we want to get to a point where our customers, they just have one platform, right? And they can use that for everything that they need. Offers them all the capabilities that they need and they don't have to worry about stitching together 4, 5, 6, 7, 8 applications to run their business overall, right. And for the wellness industry and all of this is grounded in us serving our, our customers, right? And when you're running a wellness business, whether you're a large business like Orange Dairy Fitness or you're this tiny studio and you have like two employees. Where they're going to differentiate and where they're going to shine is by spending time with their consumers, right? With their clients. So any time that they are spending in the back office in a spreadsheet or trying to figure out how do they make all these different applications work together, it's time that they're taking away from being with their consumers. So that's our goal. How do we make this so drop that simple that they can focus on running the business. One example I use quite often is Uber. And Uber, you know, there's pros and cons to the overall business and we can, we can debate that. But one thing they do really well that we want to emulate is how easy they make it for somebody to be a driver on their platform. There was a time where, hey, you needed a car, you needed insurance, you needed a bunch of things. And they've continued to chip away and to the point where, hey, now they give out loans for you to get a car. I think they even give you the cars.

[A]

Yeah.

[B]

So you just need to come in. Right. And they give you everything from, you know, the car, the insurance, to even the clients. Right. And you are. You are ready to go. You're in business. We want to do the exact same thing for wellness businesses, right? Where you come in with your. You know, for. With your commitment and your expertise and your passion, and then mindbody gives you that business in a box. Right. And everything that you need to run your business, you know, taking payments to setting up classes or appointments to actually finding your clients. Right. That's where the marketplace comes in. That's where ClassPass comes in. We want to be that business in the box.

[A]

And it's funny you brought up Uber in the. In the summer of 2008, I brought Tim Ferriss and Garrett Camp to Burning man for their first time. And I told Garrett that it was the stupidest idea I'd ever heard. And that was six months before he hired Travis to come in. I just thought it was such a. I didn't even understand what an app was, let alone how they were going to possibly build this thing out.

[B]

Um, amazing.

[A]

Mind Body Capital, though, like, the. My ex and I used to joke about the best way to make money is to start a religion or a bank. Mind Body Capital is going to be huge for you.

[B]

Yeah. Yeah. And again, all of this, everything that we do is grounded on what can we do to help our customers. Right? And when we help our customers and they do well, you know, we're going to benefit as well. So, yeah, this is all grounded in what benefit we can provide our customers. And the reason mindbody Capital was something we started looking at is Covid Accelerated. Right. And for small businesses, getting capital has always been a challenge. You know, there are some horrific stats around how long a small business needs to spend on a loan application.

[A]

Right.

[B]

And even after going through all that effort, a very small percentage of them get approved for the loan. And even those who get approved, it's not the loan amount that they sought. Right. It's a very small loan amount. So that's always been a challenge. And then Covid exacerbated it, right? Where there were not a lot of folks were willing to give loans to small businesses and you know, and unfortunately a lot of them went under. And so we wanted to help out our customers with that issue. And which is what led to Mind Body Capital. And Mind Body Capital is a very different model. It's not a loan. It is a way to give folks advanced cash in advance of them actually getting the revenue. So it's based on your future revenue. So we have all your data so we know what sort of revenue you're going to be generating in the future and we give you a cash advance. So like factoring future revenue, is it

[A]

like a factoring company or so I'm

[B]

not too familiar with factoring companies. I do know there's like a negative connotation to those companies. So I don't want to say, hey, yes, it's like factoring. What I tell you is it is a cash advance based on your future revenue. And the way it works is. And then once again you get an offer. There's no application, there's no credit check. We give you the offer based on what we know about your data. And let's say hypothetically Speaking, it's a $50,000 off, right. You get to decide, hey, am I going to paid off over six months or 12 months. And then there's a nominal fee, there's a fixed fee that comes out of it. And then the beauty of this model is it's a fixed fee no matter what. So let's say Covid, God forbid it doesn't happen. But if it happens and there's another shutdown and my yoga business needs to shut down for a month, the payment because it's deducted based on from your future revenue based on whatever management you've claimed.

[A]

It adjusts.

[B]

Yeah, it'll just get, it won't even adjust, it'll just get pushed out. So if you're close for a month, it'll just get pushed out. There's no increase in fee, there's no negative implication, it just gets pushed out. That's the model we've rolled up.

[A]

There's a company out of Canada called Clearbank that's doing something similar, I think on this. I, I'm intrigued with it because my sister runs a company. She's 180,000 people playing co ed intramural sports. That ties into the, the mind body space for sure. I'm going to talk chat with her about it. Do you guys have any relationship with Mindvalley? Do you know Vishen and his company mindvalley at all?

[B]

Yeah. So a Lot of the folks that you mentioned are people that I'm aware of and I on a personal side. So I listen to Mindvalley podcasts all the time. I'm a big Vishayan Latiani fan. One of my favorite books in the last year has been Buddha and the Badass, which he wrote. And I also read some of his other books as well. Same with Tim Ferriss, who you mentioned earlier. Huge Tim Ferriss fan. I listen to his podcast every week. So a lot of things that they talk about, continuous learning and needing to focus on your mind and your body, deliver full, complete life, those are things that have had a huge impact on me personally and by extension it's something I take into the company as well. We don't have any business, you know, really, but they've had. But they've had an implication on just how we think about the world and our mission.

[A]

So, you know, I'm. I'm in Vin Bishon's book. He wrote about me and my vivid vision concept in his book.

[B]

Is that right?

[A]

Yeah.

[B]

Wow.

[A]

And so the reason I bring it up is and I should introduce you if you're interested in chatting with him. Wonderful human, great market. They've got about a 2 million, which is way small compared to what you guys are running with. But they have 2 million subscribers on their email list and in their marketplace that are. Are that care about the mind, body, you know, space. But they'd be an interesting affiliate or partner or marketing partner or channel for you guys at some point or, or just even a tie in or to be on their podcast, whatever.

[B]

Yeah, there's a lot we could do together and at a personal level. Yeah, I would love to meet both Ferris and Luckiani. They've had a huge impact on me.

[A]

I'll introduce you to both the mob line and Vishen. Yeah. Vishen COO is also a member of our CO alliance. Okay. So in tech right now, it has been really tough in the Bay Area for technology companies to attract talent because of, you know, The Google and PayPal and eBay is like buying talent. It's almost like predatory pricing. And now it's like predatory hiring. Right. They're just coming in, throwing money at all these people. How do you compete against them or how do you compete for that war on talent being a tech company? And then secondly, has this started to become more of a global issue now that employees can live anywhere? Now you're living in Ohio and the big companies are going to poach you there with the big salaries too, are you seeing anything there at all?

[B]

The answer is yes to both. You know, the fact that there is a war on talent, especially in the tech world, and now, you know, with COVID it's. It's across every industry, but it's always been there in the tech world and it's. It's gotten even more intense. So, yes, we do have a challenge with finding and retaining top tech talent. The thing that we have going in our favor is the mission again. Right. The reason why I came, I would say it's the number one reason why others come to mindbody as well. Because of the fact that this is a chance to help people connect to wellness and actually have a direct line of sight between the work that you're doing and somebody feeling healthier, fitter, more confident in themselves. And that's very, very meaningful. I frequently talk about how, hey, we attract a lot of missionaries as opposed to mercenaries, and that plays to our favorite. Yeah, but having said that, we do live in the real world and when folks come calling and they throw obscene amounts of money, it is a challenge. And we've managed to keep our top talent. We've lost some along the way, and in a perfect world, we wouldn't lose anyone, but we have lost some. And I think it's just the reality of the world that we live in. But we've kept a lot of our top talent. And I think it's because of this whole missionary versus mercenary point that I just made.

[A]

Yeah, I think so as well. When people deeply care about what they're building versus just, you know, they're building some. It, they actually, it matters to them. How was the. I was going to ask you about the impact of COVID on the business because, you know, well, I guess again, it's only. No, it'd be 100 of your revenue really got impacted with that when. When your. Your customers are really operating fitness locations and they had to shut down for that period of time, what was that like on the business? How did you manage the emotions and the fear of all the employees that were probably freaking out? Walk us through some of that.

[B]

Yeah, that was really tough. Cameron. Our business was and is directly impacted by Covid. Right. Because all our customers have storefront locations. Right. And it's yoga classes where they're bringing people in, or, you know, salon and spa.

[A]

Right.

[B]

And so March of last year was when this all started playing out. And we all who've lived through this will remember March really well. There was a time when I thought that, hey, this is a quick thing and in a couple of weeks, it's all going to turn around. And then I think it was around the end of March where it struck me that, man, this is more serious than we thought. And then we started seeing all the closures, and our businesses, our customers, all ended up shutting down very quickly, right? And their business all went from 100 to zero in a matter of days. And I was very worried. There was a phase where I was worried about our customers, I was worried about the company, I was worried about our employees. And then there were signs even then that we are going to be resilient and things are going to come back. One example is that a lot of our customers started getting creative. They started offering classes outside. A lot of them adopted virtual classes. And we very quickly put out a virtual platform that our customers could use to stream classes or record videos and then make it available on demand for their consumers. So I saw how creative and resilient our industry was and is. So that gave me a lot of confidence, a personal experience that I had. I remember walking by a studio where folks were working out inside, and this was a time where we were not supposed to be doing that. And I'm not advocating for us to do this. We do need to be careful. But just seeing people who are working out despite being asked not to, you know, told me that, hey, this isn't, you know, something optional, right? Wellness isn't optional. Back to my previous point, it's at the same level as, you know, education and, you know, healthcare and folks, you know, are going to find a way, right? And I personally started doing a lot of screening, I started hiking, and people find a way, right? And to me, it led me to believe, and I have a lot of strong conviction on this, is that even though, yes, we've rebounded quite a bit, there's a lot more that's going to happen. And we're not just going to rebound. It's going to be much higher than we were in 2019 pre Covid. Because I think, if anything, Covid has proven it's that we all need to focus on wellness. And like we were chatting before the, you know, the podcast started, Cameron, it's not just about physical wellness. It's about mental wellness as well, right? And there's going to be a wave and a lot more people are going to be focused on, you know, the mind, body, connection and focusing on that in addition to all the other things, right? Like family and work. Personal focus on wellness is going to be much, much more important. It already is. But I see that kind of thing to grow, and it's going to be good for our customers, gonna be good for our business as well.

[A]

That was the single biggest frustrating thing for me with COVID was shutting down of fitness facilities and gyms and yoga. I'm like, these are healthy people trying to stay healthy and we're trying to shut them down and tell them to get medicine. This doesn't make any sense to me. Yeah, but whatever. The Class Pass acquisition was that easy, was it?

[B]

Well, it's a big acquisition, so it wasn't easy. It took a while. We started the conversation a long time ago, even. We've been partners for a long time. And even during those conversations, every once in a while we would be doing these hard negotiations on contracts and there would always be, at some point we should think about how we bring these two together because it was so complementary. We were both solving for growing the wellness industry. ClassPass has a heavy focus on bringing new members into the wellness industry. And, you know, that's something we've been focused on as well. And so there's a lot of synergy when it comes to our mission. Even though the words are different, if you look at our mission statements, they look very, very similar. So it's all about growing the wellness industry. And we just approached it from different ways. And so really approached me from, hey, we're going to help the businesses get up and running. And then we have a marketplace for new people to discover it. ClassPass was like, hey, we want to create this membership. And we know there's a big segment of consumers who are looking for that type of offering where they want to discover and try a lot of different modalities and then pick one. And they're going to be some who are like, hey, I want to continue down that path. Right. So they went after that segment. And the thing that I keep telling people is there's 7.7 billion people in the world. They should all be participating in wellness and there isn't going to be like one model that they're all going to be using. Right. All 7.7 billion are going to use Apple Fitness. Well, that's not going to be the case. Some segments will only want virtual and they like Apple and they will use that. Great. Do that. Right. And that's wonderful. There's going to be one segment which loves going to the yoga studio down the street, and that's all they want to do. Awesome. MindBody has solutions for those businesses and those consumers. They're going to be some who want to go to that yoga studio. But hey, I also want to augment that with Pilates and I want a little variety. We can support that as well. And some who also want to do virtual, we can support that as well. So it's not like there's going to be one company that solves the world's needs. 7.7 million. That's a lot of people. There's a lot of solutions and we are approaching it with a different lens, which is we want to help these SMBs and boutique fitness and wellness providers. And that's who we are going to. We are going to continue serving. And FastPass and MindBody are focused on that segment.

[A]

Now, were you really merging these two companies together or was it an acquisition and they're going to remain as a standalone under a parent company?

[B]

Yeah, so we just closed the deal a couple of weeks ago, so it's still early days. The high level of thinking is there's going to be synergies. Right. So there are some customers of ours who will benefit from ClassPass. Right. And we want to make sure that they're aware of that. It's optional, of course, but we strongly believe that once they look at the value that ClassPass provides, and again, back to the Uber model, we can plug them in with new consumers. ClassPass is another way to plug these businesses into new consumers. So we strongly believe that once they learn more about it, that they'll want to adopt that and that's going to help our consumers. So we will have ClassPass running the subscription business. So that's going to continue, but we will continue to find synergies again, all in service to how we can help our customers.

[A]

How about merging the leadership teams? Like, are you, you know, I'll just pick an example, but you know, you have a C dot something or CFO or cmo. Let's just pretend it's cfo.

[B]

Right.

[A]

And just so anyone listening, we're not merging finance together. We're using this as an example. But how do you have the discussions with the Finance Group at MindBody and the Finance Group at ClassPass and talk about merging them together and who's going to get left out or who's going to get replaced? How do you think through that and have those discussions or will you need to.

[B]

Yeah, so finance is actually a easy one because we do know those teams are going to come together. We're not going to have two sets of books. Right. And in the medium term, it makes sense for us to have one set of books. Right. And it Makes sense to have one closing date one way. How we do forecasting and planning. So those are coming together timing wise. It worked out well because our the Mind Body CFO and he's been with the company for a while. Brett White, incredible colleague he is. He made it very clear that he was stepping down and he's retiring.

[A]

Yeah.

[B]

So when this happened, class as a cfo, Tom, who we really like. So he's taking over as the CFO and the teams are coming together and there's going to be one finance team. Now we're having a similar conversation across multiple functions.

[A]

Yeah. Marketing.

[B]

Some teams are going to stay separate, some teams are going to come together and the way we're looking at it is we want to solve for accelerating the business, accelerating the value we can bring to the industry. That's the number one priority. Right. And the integration will follow that. If it makes sense. If we need to go fast in this area and we need to bring these teams together, we will do that. We're not approaching it inside out, which is like, well, we have these teams. Let's focus on bringing the teams together. We're doing it, you know, reverse customer led.

[A]

Right. All right. I want to go back to the 21, 22 year old. Sunil, you're just graduating from your undergrad, you're getting ready to start off on your career. What advice would you give yourself back then that maybe you know it to be true today but you wish you'd known, you know, at a much younger age.

[B]

Yeah. So for advice, number one would be don't burn out. That was.

[A]

Yeah.

[B]

I wish somebody had told me that I wasn't invincible. I don't know if I would have listened, but I wish somebody had told me that. I think another thing would be don't forget to have fun and, you know, and be grateful and live in gratitude. And something that I've tried to do ever since I burnt out and I try to do it to this day, you know, I have a gratefulness exercise that I do every morning where I, you know, I spend time thinking about all the blessings I've been given. Right. And you know, the fact that I was born to the parents that I was born to and they were wonderful, you know, my sister, you know, and my wife and the kids. And I spend time thinking about all of that and just being thankful for all of that. I also believe that what you focus on is what's going to grow and it's so easy to fall into that trap of, oh man, this is a problem. Oh, I have this issue at work or I had this disagreement and it's so easy to get caught up in that. And I still do, right? And it's not like, hey, I've ascended to a level where none of that bothers me, right? That's when I think you become the same. And this is why Buddha and the Badass is a book that really resonated with me because it talks about you can do both, right? You could be a badass when it comes to business and have aggressive goals and go after it and work really hard, but you don't have. It doesn't have to be mutually exclusive from just being empathetic and kind and being like Buddha. Right? So I love that idea that you could do both. And that's what I'm trying to do. And for me, that's a daily challenge. There are some days where I do well with that balance and then there are some days where I'm, you know, when I don't and I get caught up in, you know, in my own negative cycle and then, you know, takes me a focused effort to get out of it.

[A]

Amazing. Sunil Rajasekar, the President and CTO for mindbody. Thanks so much for sharing with us today on the Second Command podcast. Really appreciate the time and the insights.

[B]

Of course, Cameron, thank you so much. Time flew. This was a great conversation and I'm looking forward to continuing it outside of the podcast.

[A]

Thank you, Sunil.

[C]

You've been listening to Second in Command, brought to you by COO alliance founder Cameron Herold. If you enjoyed this episode, please be sure to like, share and subscribe to us on Apple Podcasts, Spotify and our other podcast streaming platforms. For more best practices from industry leading COOs, visit COOAlliance.com SAM.