As CEO of MINDBODY, Rick Stollmeyer is focused on growing the company he started in his garage, but he firmly remains true to the company’s fundamental vision of creating a space where people can connect to their wellness. Ladders spoke with Stollmeyer to get his advice on business growth and the most important factor in standing out in the competitive health and wellness space.
What’s been the most important lesson you learned so far, well being CEO?
“Well, a CEO succeeds only because of the team around them. And I know you’ll hear a lot of CEOs say that, but this business started in my garage and now it’s scaled to a global enterprise. We have over 2,000 employees, and the only way I’ve been able to scale from that garage startup guy is because I’ve continuously surrounded myself with highly capable people, and I think that’s where the CEOs run out of runway is when they’re no longer able to do that, and there’s a lot of reasons that happens.”
What have you learned about finding those people?
“You need to find people that are excited about your vision, aligned with your core values and have the proven capabilities to go where the company’s going to go. So in other words, you’re always thinking ahead. Like right now, we’re a $300 million a year company, but we’re going to be going to a $1 billion revenue company.
So my job as CEO is to always be thinking two and three steps ahead and looking for those leaders capable of doing the next level. So obviously, it’s a huge plus if they’ve actually proven it, so a number of our newest leaders are people that have come from much larger companies than ours and they can see around corners that we haven’t even seen yet. People that have come from companies like Intuit, eBay, Apple, Google, Amazon, they’ve seen large scale technology in a way that’s in our future.
And the second is just looking for intrinsic capability. There’s really no substitute for somebody who’s passionate, really cares, and constantly shows up ready to stretch. I’m stretching myself every single day, and that’s because this business tomorrow will be a little bit bigger than it was yesterday.
So we’re constantly growing and the kinds of people reading your material are likely interested in growing businesses. It’s said that a business is either growing or dying. There really is no middle point, and so that means you need people that have that kind of passion. It’s really a fire in your belly that you want to do something that really matters.”
— Mindbody (@askmindbody) March 13, 2018
While we’re on the topic of growth, what have you learned as MindBody has grown about shaping company culture?
“The essence of it is you need to nail this early, you need to understand, number one, is what’s the ‘why’ behind this business? Our ‘why’ was always to create a place where people could come and connect to their wellness. Initially, this was a web portal idea because this was in the early 2000s, and that actually led us down this journey of building this really effective business management software for fitness studios, gyms, clubs, integrated health centers, salons, and spas. We realized we needed to go do that so we could achieve our ultimate vision. So nailing that vision early is really important.
It’s really rare that a business is going to change its fundamental vision. If you look at the purpose statements of some of the greatest companies, you see that the founders understood their vision even when they were working out of their home, or in their kitchen, or their garage. Jeff Bezos, ‘to create a place where people can come to find anything they might want to buy online.’ He wrote that in the late nineties when it was a pipe dream. So you need to nail that early.
Then, secondly, you need to decide what are the values of the team you want to create? These values need to be actionable, they need to be authentic, they need to have some distinctiveness to them. It can’t just be…’ we have a group of people who like to work hard and have fun.’ That sounds like most of humanity, or what everybody wants.
So at MINDBODY, our core value number one is that we are committed to wellness. We really want to walk the talk of the seven dimensions of wellness. It’s not just physical fitness, it’s also emotional wellbeing, it’s mental wellbeing, it’s having a sense of social connection. It’s having mental stimulation so that we’re constantly growing and expanding our minds. It’s having a sense of purpose, a sense of spiritual wellness and whatever that might be for the individual.
So we address an industry that provides that. When you go to a yoga class or a group exercise class, you’re not just getting more fit, or getting a good stretch. You’re getting this whole mind and body connection. You’re getting social connection with the teacher and with the other people that are in the class with you. This is something that deeply inspires us. So we’re also deeply committed to the wellness industry. Anything that can help expand people’s access to that and grow that industry is something that we care about. That’s number one.
Number two is a personal characteristic, we’re humble and we’re helpful. Humility is not something you find in many core value statements, because technology companies tend to not necessarily be full of humility. There are quite a few arrogant people in technology because technology is so powerful right now. But that’s not the kind of people we want to have on our team. Helpfulness is you really love helping other people and I don’t know how to teach that. I think it’s something our parents instill in us or maybe even goes deeper.
Number three is that was audaciously achieving. We are a group of people that want to do things that are like distinctive and unusual and yes, we’re humble and we’re helpful, but we also are motivated to win and we’re motivated to succeed in a profound way.
Next, we’re empathetic. We’re actually striving to understand the point of view of the other. For us, of course, it’s our colleagues and our customers.
Then lastly, we’re continuously evolving. So no matter how good we are today, we need to be just a little bit better tomorrow. Every one of us is completely free to wake up tomorrow and be just a little bit better in how we take care of ourselves, how we attend to our loved ones, how we respond to strangers on the street, how we interact with our colleagues, and how we treat our customers.
So that spirit infuses the organization and we stepped out early. We hire on it, we onboard new team members around this, we train people on it. If necessary, if people are really not inside that and they got through the screening process and we thought they were that way, but they really aren’t, it’s really hard to change someone and then we have to be willing to let them go.”
MINDBODY is a proud sponsor of @GEHFM. Global Employee Health and Fitness Month aims to promote the benefits of a healthy lifestyle to employers and their employees. We hope you'll join us in this initiative! pic.twitter.com/2DddSrqCL4
— Mindbody (@askmindbody) May 9, 2019
Is there one industry trend that you’re keeping an eye on right now?
“Well, there’s a lot of trends of course, but I’ll just pick on one, and that is digital. So the ability to deliver wellness experiences through on-demand and streaming media, both video and audio is obviously very, very hot. What we have found and what we’re finding is that, actually, that is becoming an additional way in which wellness entrepreneurs can connect to larger audiences. The digital meet face to face, we think is the way of the future.
If you look at Peloton opening physical bricks and mortar locations, why would Peloton be doing that? How does that make sense if it’s all just going to get virtualized and why would you pay the rent and utilities and the hassle of having a storefront? Because it’s a digital meets face to face experience. That’s really what Steve Jobs realized with the Apple stores.
And so we see the yoga studios, the pilate studios, the group exercise, using digital to connect to larger audiences. There are opportunities for home-based entrepreneurs, where you can reach a very large audience. If you kind of think this through in your mind, what ultimately it does, is it first and foremost increase the audience.
Only one in five people are engaged on organized fitness right now in the United States, and the stats are pretty similar in all the developed world. One in five. So even in New York City where you have like the highest density of these wellness and fitness studios. If you’ve gone on our MindBody app, but just use that app, you can do a search and put in drop pins on a map and it kind of blows you away. They’re literally everywhere. Guaranteed we have a customer within 200 feet of you right now if you’re in the city.
So you might think, well it’s all saturated. But I don’t know, because even in New York, less than one of four are engaged right now. So what happens as you engage more people is you actually drive up the value of the face to face. Why are theater tickets and concert tickets and sporting events tickets more expensive than ever? Because even though we can experience these things on our 60-inch digital screens in our living room, and arguably experience it in a better way than you can if you go to the stadium or to the theater….there’s nothing like that direct human contact that live performance.
So we believe the same is true in the boutique wellness industry, and you can expect MindBody to be releasing innovations around digital that will connect the digital to the face to face experiences.”
What are your strategies for standing out in markets as competitive as health and wellness?
“So in our case, we are two sides of this. We are the B2B software provider for all of those boutique businesses that you see out there, and we are also the B2C platforms. So the MindBody app is for consumers and there’s a website, MindBody.io that is for consumers. And you can expect us to start increasingly engaging the consumer audience.
So let’s talk about both of them separately. On the B2B side, we had to decide, what are we really great at? And this pertains to any business if someone aspires to grow…and that is…you can’t be great at everything and you cannot serve everybody. You have to narrow your focus. So in the early years, we made the mistake of thinking, well, we could go into any form of fitness or any form of wellness. We’re just not as effective in different areas.
What we realized is that high-quality boutique fitness, and high-quality boutique wellness and spa, those are our sweet spots. And so what do we mean by high quality? They deliver a truly transformative experience to the consumer. They’re run by generally more sophisticated business owners, even though these aren’t techies and they don’t generally have large business backgrounds, but they really are committed neighborhood business owners. They’ve really thought through their business plans and they’ve got enough capital to actually succeed.
So targeting that audience and giving them the kind of powerful, sophisticated product that they need and providing it with also what we call white-glove service. We have hands down the best customer service in the industry. I can’t tell you we have hands down the best software for every use case for every type of customer because what we do is really complex and we’re constantly working on improving the product. But the thing that actually differentiates us is the targeting of the product, and the kind of concierge experience around implementing the product and supporting it, which these small business owners want because they’re really busy and they don’t want to be in the business of implementing software.
So for the B2C, we’re starting to market nationwide now. You might hear us on NPR, you might see our exterior advertising, although New York City is super expensive, so you are not going to see us on buses in New York soon. But we’re doing it in Boston and other cities and in Metro stations, and so we’re targeting the kind of urban professional who has the desire, and the economic ability to act on that desire and to improve the health and wellness for their lives. And it’s about health, wellness and happiness, and so again, being very targeted, decide who your customer is and get inside their heads and target your message for them, rather than trying to be everything to everybody.”
How do you think the future of work plays into the operations at MINDBODY?
“Yeah, it’s a great question, because there’s so much to say here, but I’ll focus on two things. The first one is talent. Right now there is negative net unemployment of highly qualified professionals. What does that mean? There are more jobs open than there are people in the United States to fill them. This is a great thing for anyone who’s young and talented and motivated because you can walk on to any number of jobs right now.
The only way for companies to succeed is to have a location-agnostic approach to how they source talent. So we have 14 offices around the world, and we try to cluster different centers of excellence we call them. But by and large, if we’re looking for a certain kind of professional, we’ve gone from being like, ‘okay, you have to be our main headquarters in San Louis Obispo, or in our downtown New York office,’ to saying, ‘okay, well there’s other offices, satellite offices you could be in or you could work from home.’
So I think it’s essential that companies embrace this, and I think the most powerful business models being envisioned today will increasingly leverage geographic agnosticism, I’ll call it, to location. With tools like Slack and Zoom, we can actually see each other in real-time and we can have a meeting with six other people, and one of them could be in India and one in London and one in Sydney, Australia. We operate like that every single day on MindBody now.
When MindBody is going to partner with someone, how do you choose those partners? How do you go into this decision?
“This is a really important question for us because platform partnerships are essential. We decided early on to build an API platform, which means an application interface, that allows other people to build tools on top of our product. One of the most well-known examples is ClassPass. You may not be aware, but ClassPass is a partner in MindBody and was actually born on our platform. Of course, they’ve been a huge success.
So number one, we don’t overly control who decides to try to build something on our platform. We want to make sure that they’re an ethical business, they’re not doing anything illegal or wrong. They have to be very careful with data, and any data they access is data that belongs to our customers, and our customers have to give individual permission. If a studio wants to join ClassPass, for example, ClassPass has to get their written permission to link up to their system via our platform to link to their data. We want to make sure that they have privacy policies and regulatory requirements have been met, and so forth.
So that’s just the essential, but beyond that, there’s a lot of ideas springing up, and the reason to have partnerships is first, it’s just simple recognition. The humble recognition, we can’t possibly do it all. The customers being the business owners need so much from us. On the consumer side, we integrate with Fitbit and Garmin and Apple healthcare. Well, obviously we can’t go out and build all that stuff ourselves. So we’re looking for things that are complementary to us. We want to really lean into partnerships where the businesses have values that are similar to us, where they really are motivated to grow the wellness industry on both sides, on the consumer side, and on the B2B side.”
How do you describe the company culture at MINDBODY?
“It’s really embodied in the five core values. It really perfectly describes the culture of the company, because we’ve made it that way. I’ll add a few more elements. We’re just highly collaborative. This is a team that’s fired up MindBody on the outside might look sort of soft and fuzzy, sort of a cute company like, ‘Wow, yoga software. How cool is that? What a great idea.’
Well, you know what, like all things, it’s a lot more work than it looks, and so a group of people that are fired up that actually want their work to matter…they want their lives to be about something more than themselves, and just making money. We all want to make money. It’s why we go to work. We want to provide for ourselves and our families and be able to have great experiences in our lives and go out to nice restaurants and vacations and all that. But at the end of the day, if that’s all your work is about, it’s not very fulfilling. I mean you’re doing Ladders hopefully because it inspires you to talk to business leaders and to help the next generation of leaders develop into their full potential. That’s a meaningful purpose and that’s the kind of people we have at MindBody.”
'Tis the season for free hugs. Happy holidays from all of us here at MINDBODY. pic.twitter.com/qHhH8KoRCM
— Mindbody (@askmindbody) December 24, 2018
What advice would you give to someone interviewing at MINDBODY?
“I would say definitely check out our core values and our purpose, and ask yourself first and foremost, does this resonate with you? That’s going to be the number one most important question. If you’re lacking certain skills…you can teach skills…how to use different technologies, how to perform in a different kind of job, but you can’t teach values. It’s just really, really hard to change someone’s values. So make sure that your values align with us.
Take a look at the breadth and depth of the job opportunities we have. We have hundreds of positions open right now in multiple offices around the world. You might not be able to get the exact job you want right now, but should you get your foot in the door with MindBody because you’re really motivated by our purpose, and you really aligned well with our values and you’re talented, and you’ve proven that you can perform really, really well…you’re excellent at what you do, whatever that is. You can enter through one path, and then end up jumping over to a different part of the company, and we do this a lot of MindBody. We move people around, we promote from within because people understanding different parts of the business helps create a unity and a shared understanding of where we’re going.
Lastly, and I’ll give you the hack of what I think is my most important interview question, and that is why did you major in digital and print journalism? Or, why did you minor in political science and government? I’m looking at your LinkedIn. So the point is, if you were interviewing with me, I would ask you that question.
It doesn’t really much matter what you majored in. I mean there’s very specific skill sets people in IT or software engineering. By the way, some of the best software engineers have liberal arts degrees. It’s not necessarily a STEM type of a thing. But what I really want to know about you, is why? Why did you choose it and what have you learned from it? And that opens up like an amazing conversation with the right people. With other people, it catches them cold. They’re like, ‘I majored in communications because it was the easiest major I could pick,’ or ‘because I really wanted to major in pre-law, but I wasn’t good enough.’ Like, that’s not very inspiring. I’m giving away a secret here, but that’s one of my big differentiating questions.”
Is there anything else either about MINDBODY or about yourself that you’d want people to know?
“I’ll just say this, that if you’d asked me at 30 what I’d be doing today, in my 50s, I would’ve had no idea what you were talking about. So as you’re plotting your career, know that it’s going to take twists and turns you could never predict, and at the end of the day, to paraphrase Steve Jobs, again, you have to trust your gut, your intuition.
Be thinking with your head, your heart, and your gut, and doors will open you never imagined. If you find yourself trying to talk yourself out of it, it’s probably the thing you should do, because your heart and your gut already want it. Alternatively, if it’s the perfect next job and perfectly matches what you studied in school, and it’s the right next step on the corporate ladder, and you’re just trying to talk yourself into it…yeah…don’t do it. That’s the best advice I could offer young people today.”