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Peloton Confidentially Files Statement for Proposed IPO

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Re: Peloton Confidentially Files Statement for Proposed IPO

#111

Post by notyourday »

ftio wrote: post #98

Peloton's business model is breathtakingly good, but I wonder about the size of their TAM and their ability to have sustained, multiplicative growth in the future. First, the business model. They sell you a $2000+ bike, which includes a year of live classes with some of the best spin instructors in the world. Afterwards, you pay for a $40/month subscription in perpetuity to make your $2000 investment more than a bori…

It's dead, sorry. They will need to pivot to something else.

My wife and her girlfriends used to be Peloton bunnies - one of the ones that you see in a studio in some of the ads. Two years ago classes were super hard to get into. They had the best instructors ( Peloton would overpay to steal the ones with following from Soul Cycle and FlyWheel ). The home invasion week got housewives from Midwest show up in classes with fifteen outfits because they thought they were going to be on TV or at least seen by the people at home. It was buzzing. Bikes were selling like hotcakes -- no discounts, no promos no anything.

Two years later, she barely goes there once a month. Classes now are meh. The studio is losing its luster. Home invasion week has classes available. There are discounts and specials on bikes, not to mention a talk of a bring your own bike option. Her friends that had the bikes at home sold them.

And competitors. Mirror showed up. Rumble showed up. FlyWheel and Soul Cycle are nibbling at its feet. Instagram is full of Pilates and Barre at home channels.

It is BlueApron all over again.

Re: Peloton Confidentially Files Statement for Proposed IPO

#112

Post by ftio »

notyourday wrote: post #111
ftio wrote: post #98

Peloton's business model is breathtakingly good, but I wonder about the size of their TAM and their ability to have sustained, multiplicative growth in the future. First, the business model. They sell you a $2000+ bike, which includes a year of live classes with some of the best spin instructors in the world. Afterwards, you pay for a $40/month subscription in perpetuity to make your $2000 investment more than a bori…

It's dead, sorry. They will need to pivot to something else. My wife and her girlfriends used to be Peloton bunnies - one of the ones that you see in a studio in some of the ads. Two years ago classes were super hard to get into. They had the best instructors ( Peloton would overpay to steal the ones with following from Soul Cycle and FlyWheel ). The home invasion week got housewives from Midwest show up in classes w…

I hear you. Hard to disagree with that assessment. I didn't paint quite as bleak a picture because so far they've shown that they can execute really well, but I tend to lean in your direction when I think about their future.

Investors, founders, and early employees will make a bunch, but it's hard to see Peloton as a company that'll be with us in the long term.

Re: Peloton Confidentially Files Statement for Proposed IPO

#113

Post by notyourday »

temp129038 wrote: post #14

Not to shill for Peloton (I don't have one), but the success of SoulCycle and Barry's Bootcamp show that there's appetite for $32-$35/class "boutique" fitness classes. If you would otherwise go to either/or 1x-2x/week then the math does work in Peloton's favor when you factor in the class + transportation to/from + removing temptation of buying a $10 smoothie too + any "add-ons" you'd otherwise buy (e.g. water).

Both are in person, not remote.

Re: Peloton Confidentially Files Statement for Proposed IPO

#114

Post by spyspy »

entee wrote: post #41
spyspy wrote: post #6

Earlier quoted context omitted.

My sides. I have friends working there that have tried getting me to apply. Glassdoor reviews indicated their backend interview is unnecessarily difficult and I have little faith in their business model. How many people are willing to spend thousands on an exercise bike? Let alone one that requires a $40/month subscription? It feels the same as Blue Apron - the market is people rich and lazy enough that don't want do…

I am a fairly experienced road cyclist and even though I prefer to ride outside AND have a computer-controlled bike trainer, I would consider one if I had the space. I also have several friends who prefer this to all their other options. 1.) It's way easier to get started up without the faff of setting up your trainer. If you have a dedicated bike+trainer this is less of an issue, but that is going to cost a fair amo…

I see your point that, for you, there's an appeal. But with so many comments disagreeing with me and saying there's "tons" of market I'm inclined to maintain my point. I think the market (and evidenced by the way it's _marketed_) as it stands is not the general public. It's either people who are already paying gobs of money for cycling classes à la SoulCycle or already dishing out money for their cycling hobby. On the topic of a looming IPO, I don't see their growth continuing to accelerate for much longer.

Re: Peloton Confidentially Files Statement for Proposed IPO

#115

Post by notyourday »

koolba wrote: post #100
ftio wrote: post #98

Peloton's business model is breathtakingly good, but I wonder about the size of their TAM and their ability to have sustained, multiplicative growth in the future. First, the business model. They sell you a $2000+ bike, which includes a year of live classes with some of the best spin instructors in the world. Afterwards, you pay for a $40/month subscription in perpetuity to make your $2000 investment more than a bori…

> Doesn't hurt that in-person spin classes regularly cost $30-40 for a single class. The first time I heard about the prices people were willing to pay for spin class I thought it was joke. Turns out there really are (a lot) of people out there that will pay $40 to have someone periodically yell at them for an hour.

That's a long tail. The ones who go to classes all the time buy packages that are $200-$300/mo unlimited or use ClassPass.

Re: Peloton Confidentially Files Statement for Proposed IPO

#116

Post by gamblor956 »

wlesieutre wrote: post #34
bstar77 wrote: post #19

Earlier quoted context omitted.

This bike is for people that don't want to go to a gym and/or don't have lots of time to leave the house on a daily basis. You can also finance the bike so the hit isn't so bad. Additionally, there's no extra charge for multiple accounts (up to 10), so if everyone in the house uses it, the cost makes more sense. I work out of home and this is the only way I get consistent exercise. My fitness has gone up tremendously…

Semi-related, I just got a $400 Oculus Quest and burned 1900 calories playing Beat Saber yesterday (as calculated by Apple Watch's "Other" workout type). Much cheaper purchase and fun enough that I can enjoy playing it for hours a day. I have an (admittedly shitty) exercise bike, and will probably be using that a lot less now. If anyone's looking for a home fitness gadget, give that a look. I'm told BoxVR is a better…

That must have been a lot of Beat Saber...running a half marathon (13.1 miles) burns fewer calories than that.

Re: Peloton Confidentially Files Statement for Proposed IPO

#117

Post by wlesieutre »

gamblor956 wrote: post #116
wlesieutre wrote: post #34

Earlier quoted context omitted.

Semi-related, I just got a $400 Oculus Quest and burned 1900 calories playing Beat Saber yesterday (as calculated by Apple Watch's "Other" workout type). Much cheaper purchase and fun enough that I can enjoy playing it for hours a day. I have an (admittedly shitty) exercise bike, and will probably be using that a lot less now. If anyone's looking for a home fitness gadget, give that a look. I'm told BoxVR is a better…

That must have been a lot of Beat Saber...running a half marathon (13.1 miles) burns fewer calories than that.

I broke this down in another comment, but trusting Runner's World for a calorie calculator, a half marathon would take me 2080 calories (at 210 lbs). So a little bit less than that.

Average calorie burn was 830 calories/hour, which they say is equivalent to me running at an 11:30 minutes/mile pace.

In terms of effort expended, important to note that this was three sessions over the course of the evening, adding up to 1900 calories and 2 hours 17 minutes.

So it was something like running 4 miles 3 times with an hour and change break in between, which is probably an easier feat than doing it in one shot.

My arms are still sore and I don't plan on doing that every day, but it was definitely a workout.

Re: Peloton Confidentially Files Statement for Proposed IPO

#119

Post by gamblor956 »

spyspy wrote: post #114
entee wrote: post #41

Earlier quoted context omitted.

I am a fairly experienced road cyclist and even though I prefer to ride outside AND have a computer-controlled bike trainer, I would consider one if I had the space. I also have several friends who prefer this to all their other options. 1.) It's way easier to get started up without the faff of setting up your trainer. If you have a dedicated bike+trainer this is less of an issue, but that is going to cost a fair amo…

I see your point that, for you, there's an appeal. But with so many comments disagreeing with me and saying there's "tons" of market I'm inclined to maintain my point. I think the market (and evidenced by the way it's _marketed_) as it stands is not the general public. It's either people who are already paying gobs of money for cycling classes à la SoulCycle or already dishing out money for their cycling hobby. On th…

Generally the people that use HN are not the target market for Peloton.

In contrast to your POV, I know dozens of people who do already have Pelton subscriptions, or plan to get some. My office is planning to get 2 or 3 bikes for our exercise room.

Peloton is too expensive to see startup-type growth much longer, but they've got something better: actual revenue and a path to profitability (if they're not already there).

Re: Peloton Confidentially Files Statement for Proposed IPO

#120

Post by bitwize »

spyspy wrote: post #40
japhyr wrote: post #20

Earlier quoted context omitted.

I know people who love spin classes. They're not just buying an exercise bike. They're buying a really nice bike, and membership in a global community of people who also love spin. It really does seem like getting to go to a spin class any time you want, in the privacy of your own home. I have way more than $2k in outdoor gear, because my favorite exercise is trail running and climbing mountains. If riding an indoor…

I didn't say there was zero market. Obviously people are buying the things. But this is an IPO we're talking about. I'm questioning the long term growth of what I see as an expensive niche product.

Don't worry. Once the bike is a few years old they will release a new online training program that's incompatible with the bikes they have -- but compatible with the brand-new, $3500 retail Peloton model.
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