This pandemic is really only making the poor poorer and the rich richer. But does it really matter which side you’re on when you’re getting fitter? Today Business Insider announced Peloton’s founder, John Foley, is the latest to become a billionaire during the pandemic.
John Foley joins Jeff Bezos, Bill Gates and other notable names in the billionaire club as the rise in Peloton stock has brought his wealth to $1.3 billion.
Peloton crushed earnings estimates for its fiscal Q4 and raised its guidance. “We think that post-COVID, this is still an incredible growth story,” CEO John Foley says. https://t.co/YSBlKKXU7U pic.twitter.com/PtnJh52kdg
— CNBC (@CNBC) September 11, 2020
The Bike
Peloton is self described as an “American exercise equipment and media company,” with a mission to bring boutique fitness to your home. To the untrained eye, the Peloton bike looks like a stationary bike with a tablet connected to the handlebars. But in fact, the Peloton team has found a way to bring all the joys of group fitness classes to the convenience of working out at home with innovative technology and talented fitness instructors.
The whole ensemble creates quite the package. Let’s take a look at the price of everything, shall we? The Peloton bike can be purchased for $1,895, and the Peloton Bike+ (shown in the above video), their newest model, can be purchased for $2,495.
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Despite the high price tag, the clips can still be tricky!
If anyone wanted to rob my house just wait until I click in my cycling shoes on the @onepeloton it takes me 30 minutes to figure out how to un-clip, you could steal everything in that time.
— Tim Lockwood (@timlock21) September 9, 2020
At first glance that number does seem horrendous. But in comparison to paying for work out classes, it is actually not terrible. One person can easily spend over $1,656 purchasing classes at other indoor cycling classes such as SoulCycle, rental shoes not included.
If you are a novice stationary bike rider, you might be wondering
What’s so great about a Peloton? Genuinely curious
— Ryan Henderson (@CCM_Ryan) September 10, 2020
Let’s dive in! There is an additional $39 per month fee attached to buying a bike that covers the tech side of Peloton. With this, a rider has access to the entire Peloton library, live classes, and other types of workouts available on the app. Not to mention cool features such as individual user profiles, streaming abilities from different devices, real time data from your workout, programs and challenges.
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The Community
BUT WAIT! There’s MORE! Like many cult-like boutique workout classes, the community aspect is strongly emphasized as being part of the Peloton experience. With the Peloton app riders are able to ride along with other members live. Riders have the ability to filter by age range and gender… talk about community. But they do host fun special event classes open to all and attended by many. It’s a “movement” that’s “a million members strong.” But the community seems to extend outside the bike app.
Peloton has a REAL community of riders behind it. Just saw a woman say her husband lost his job and she has 4 kids and can’t afford to keep the bike and asking for a resell group and members venmo’d her enough money in two hours to keep her bike for life. ❤️
— Allison Esposito Medina (@techladyallison) September 10, 2020
So after all that, you can tell why so many people have been excited to be Peloton owners!
The much anticipated wait is finally over. My peloton is here! @onepeloton #pelotonnewbie #peloton pic.twitter.com/TlkkYO8wvA
— Jennifer Salas (@jennsalas143) September 11, 2020
Peloton’s fiscal fourth quarter sales have risen to over 172% according to CNBC. The company’s share prices were also up almost 8% in after-hours trading. This is all thanks to the high demand of working out from home due to the pandemic. Without access to gyms or in-person work out classes, Peloton saw numbers soar. Even as more and more gyms begin to re-open, people are still opting for their personal stationary bikes. Foley told investors, “Organic demand for our bike remains strong and member engagement remains elevated, despite improving weather and the gradual opening of brick-and-mortar fitness locations.”
I’m still scared to go to gym ????
I will workout from home until I feel comfortable with the idea of going to gym
— Shadi Letoaba ???? (@ShadiL_) September 8, 2020
Product Demand
In fact, so many people seem to want a Peloton bike, that the company seems to be struggling to meet the demand. Bike shipments are being delayed up to two months, and customer service is being swarmed. Peloton executives say that they expect delays through June 2021.
Had a friend order one recently and took about a month. The tread is also incredible but pretty sure those aren’t even shipping at all ????
— iJustine (@ijustine) July 30, 2020
anyone have a spin bike they LOVE, from a company that’s still shipping, that isn’t a peloton*!?
*because everyone else panic bought one & I don’t want to wait 7 weeks to get it…
— Dorothy Beal • I Run This Body® (@MilePosts) April 13, 2020
https://twitter.com/KyleeAlexander_/status/1304064896200568839?s=20
But Peloton seems to be giving all their attention to their bikes, even delaying the release of their new treadmill. Foley even seems to want to make an effort to keep his product affordable. He slashed prices of the original bike when the company came out with Bike+ model. The original model of the Peloton was $2,245, which is $350 more than today’s market price. Customers who just got their bike were about to throw a fit when they found out they paid a higher price for their original bike, but Peloton bit the PR crisis in the butt. They offered a credit to all customers who bought an original bike before the prices were marked down.
Lolol I was JUST telling @jenfrytalks and @drashleybaker that I was about to call Peloton as soon as the announcement dropped and get my coins back, but look at this great customer service. I appreciate them running me my coins. ???????? pic.twitter.com/UI4DyxUH9q
— Jenn Hunter, JD (@_JennHunter) September 8, 2020
Ok, I know we felt a way about @onepeloton a while back. But I’m completely in. I bought a bike last month, still waiting on it. They lowered the price and refunded me the $350 difference. THAT is customer service.
— Jasmine Styles (@_newsbae) September 11, 2020
Foley has also discussed other ways to make Peloton more accessible to others, throwing out the possibility of a rental program for the future.
Billionaire Bad Guy Dilemma
While all this excitement with Peloton sounds great, becoming a billionaire comes with lots of resentment and backlash. Especially when you happen to be directly profiting off the COVID-19 pandemic that has led to the unemployment of 13.6 million people in the U.S.
This is disgusting – purely profiting off a pandemic. If Apple did this they would be DESTROYED. @onepeloton should not be able to do this and get away with it.
— Vanessa Gilmore ???? (@VCGilmore) September 9, 2020
Profiting off a pandemic brings up a whole new ethical debate. Chema Vera, executive director of nonprofit group Oxfam International, said, “The economic crisis we are suffering because of the pandemic has been fueled by a rigged economic model. The world’s largest corporations are making billions at the expense of low wage workers and funneling profits to shareholders and billionaires — a small group of largely white men in rich nations.”
While Foley definitely seems to fit the “white rich men” billionaire mold, he is not the only one who’s wealth has grown during the pandemic, nor is he getting much heat surrounding his profit. Founder of Amazon, Jeff Bezos seems to be the brunt of many people’s frustrations about billionaires profiting at the expense of others, especially during the pandemic.
https://twitter.com/dragonnqueen/status/1304213778532188164?s=20
It's really sad to see small businesses knowing they can't compete with Jeff Bezos and Amazon so then they feel compelled to join him by putting their company in his hands so he can profit off of them, taking nearly 20% of all profits + a $35 monthly fee to keep their shop there
— sick and tired⁷ (@joonstardust) September 9, 2020
https://twitter.com/MrJFreeze45/status/1301945448731561984?s=20
If Bezos wasn’t taking the heat though, would Foley be met with more resistance? Maybe not since his product does give people endorphins after all!
Whether or not you think profiting off of a pandemic is moral or not, you must admit that John Foley is definitely doing something right with Peloton. Would you ever buy a stationary bike? Is working out from home just asking for too much?
