• John Foley steps down as CEO.
• John Mills joins us to discuss Peloton slashing revenue outlook.
• Peloton’s lead hardware developer exits.
• The “Activist Investor” still isn’t happy.
• Peloton’s new CEO will be Barry McCarthy.
• Dr. Jenn – How to make yourself do Power Zones when you hate them.
• We have a visit from the Peloton Prophet.
• CNBC talks about why Apple won’t buy Peloton.
• Mashable thinks Peloton needs Netflix.
• Angelo has tips for dealing with cravings for junk food.
• Alex Toussaint will play in the NBA All-Star Celebrity Game.
• Ryan Tannehill & Greg Olsen are team captains for Ride To Greatness.
• Donna Mills now has a Peloton.
• Paul F. Tompkins and Lauren Lapkus have a special improv Peloton video available.
• DJ John Michael celebrates 7-years with Peloton.
• There’s a new artist series featuring Swizz Beatz.
• Verzuz is back with a twist.
• Daniel McKenna celebrated a birthday (2/4)

All this plus our interview with Megan Pace!

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Watch the episode here:

Listen to the podcast here:

END OF AN ERA: John Foley Steps Down as CEO! plus our interview with Megan Pace

If I sound a little different, it’s because I am in Los Angeles. I am quite the jet setter.

We have to record even with you gone. There’s too much.

We would not have taken a week off no matter what. We certainly would not have taken off on this episode because they would have killed us.

We’ve had requests for three episodes. We’ve had requests for a three-hour episode. I know guys. I feel you. It’s been a lot to process and we’re going to get into all of it.

I remember a few days ago, which in Peloton time is approximately fifteen years ago, when the big story was like, “Is Amazon thinking about buying Peloton?”

How did that become nothing? How did that become old news?

That’s not even one of our topics.

This is craziness. We’re going to do things a little differently since Tom is out of town. He is going to be recording from afar. We have John Mills joining us to discuss because we get a lot. We also have William Cynecki back. He is going to be joining us after every earnings call and lucky him, this is the first one. We have lots to include, both John and William on. There will be other things. We’re going to talk about what’s going on with instructors and all the other good stuff.

We still have an interview. That has not changed and it’s a great interview. For anybody out there, I want to say that this could be a triggering topic because our interview talks about eating disorders. If you are a person that is triggered by that, do not listen to the interview. That will still be there. However, we are not going to be shy from digging into this conversation because there’s a lot to be said. It’s probably going to be a long one. Buckle up and join us.

Before we get to all that, shameless plugs, we’re still going to do those. Don’t forget we’re available on Apple Podcasts, Spotify, Google Podcasts. Wherever you find your podcasts, you can find us. While you’re there, be sure and follow us so you never miss an episode. If you’d be so kind, maybe leave us a review. That’s always helpful. We have a new review. This is from Sammy N 1975. She says, “I’ve been a Peloton member since early 2017. I’ve been listening to The Clip Out since the very first episode. It’s a great way to find my feed and my Pelo addiction. I look forward to listening on my commute every week. Thank you very much.”

Thank you. That was a very nice review.

Don’t forget, we have a Facebook page, Facebook.com/TheClipOut. While you’re there, like the page and join the group. It’s a great way to stay up to date on things throughout the week because sometimes during the week there’s breaking news, and we will share it for you promptly. You can also sign up for our newsletter at theclipout.com. We throw a lot of articles and stuff at you, and sometimes it’s hard to remember what got posted where. You will get that in one weekly digest with all the links that we’ve discussed so you can follow up to your heart’s content. Finally, if you want to look at our lovely faces, you can go to YouTube.com/TheClipOut, where you can watch all of these in HD. There’s all that. Let’s dig in. Shall we?

We shall.

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Joining us once again is John Mills from Run, Lift and Live. John, how’s it going?

What is going on? What’s happening.

We are also being joined once again by William Cynecki who was on here a while back to talk stock stuff. Our plan was to bring them back for earnings calls and lo and behold, the first earnings call is this one.

There’s a lot to unravel here.

What a way to make a splash with that entrance.

Let’s dig right in. No need to bury the lead. The earnings call was bumped up in the day on Tuesday and everybody was like, “What does that mean?” It meant that John Foley is stepping down as CEO. As we mentioned in our last episode, the layoffs are coming.

I don’t know if you guys remember but I said that we’re probably going to have to see some layoffs. We’re going to probably have to see a slow down in manufacturing. It turns out it’s that times ten, unfortunately. It sucks because John Foley intended Peloton to be a generational company. I still think it will be a generational company, but it was never meant to be a giant in 2022 and 2023.

The pandemic had tricked Foley into thinking that he could grow a company into what he initially envisioned would take ten years. He thought he could do it in three years. He took a huge gamble and I don’t blame him for taking that risk. I’m a little irked at how he misled shareholders too a little bit, but it was Murphy’s Law. Everything that could go wrong did go wrong for Foley.

In retrospect or hindsight, we can see all of that clearly. Even prior, you had the whispers of what people were saying. My mind goes to human nature. I was saying this in my group. It’s like I played a lot of basketball and a lot of sports. You have some days where it doesn’t matter what you do, you could close your eyes and the ball goes in the hoop. Everything is going right.

When those things happen, you start drinking your own Kool-Aid. You start smelling your own crap. I don’t think that’s an individual that does that. That’s common human nature where everything turns to roses, then you think this is what it is. I think about that as it relates to the Peloton and how they were moving. As you said, Tom, they were like Atari circa 1983. That was how it was. They had this veil, and a lot of folks would have had that same type of outlook.

He’s an optimist. He is very optimistic. I honestly use the analogy of when demand started plummeting, John Foley found himself in quicksand. Anyone familiar with quicksand knows that the more you move, the faster you fall. Every move the Foley made was the wrong move, and it dug him deeper into the ground. You would have been better having the lead time be 8, 10 weeks. It’s not increasing the production, not spending 35% on advertising, not cutting the bike price, which resulted in lower demand. It’s unfortunate and here’s the thing. I’m a risk-taker. As you guys know from my investing, I take risks. I don’t fault him on that and I hate to see him step down.

It really breaks my heart. I felt sick when I read this headline. It was the second to last thing I wanted. I believe that this is the only thing that would have kept them from being bought at this point and therefore, I’ll take it. He wouldn’t have had any control or any say in anything that goes forward. To me, this is truly the end of an era. You like it, love it, don’t agree or agree, John Foley was the heart of this company. Not having him at the home means everything changes from here on out. I don’t know how to feel about that. I fell in love with the company and who they were as a company. I’m not just a shareholder. I’m not a person who just bought a product. This was so much more to me than just a product. I don’t know if it ever will be again.

The thing we need to keep in mind though is it’s not like they packed all his crap in a box and escorted him off the premises. They didn’t put his things in a cardboard box and say, “Get walking.” He’s still there. He’s the Chairman of the Board or whatever the official moniker is. It’s corporate speak so I don’t know. He’s still going to have input. The new guy, Barry McCarthy, sent out an email that said he has nothing but respect for Foley. He knows that this company and this product is what it is because of him. I’m paraphrasing but he said, “I’d be an idiot if I didn’t take his counsel on the overall direction of this company.” Everything comes back to movies and pop culture for me, as we know. It’s like they talk about this in The Godfather. Tom Hagen wasn’t a wartime consigliere. Maybe that’s what we got going on here. The guy that built it maybe isn’t the best guy to keep moving the ball forward. Maybe this isn’t the worst thing.

Here’s the thing. John had everything that was needed to take the company to IPO. When you get that international and you’re that big of a brand, and we see this in other companies, sometimes it takes new management to take it to that next step. I commend Foley for stepping down. That was a big one because he still has a lot of influence on the company. The executive team owns 75% of the shares. He still has a very strong influence as you said and as it was said in the email.

At the end of the day, Barry still works for him if he owns the bulk of the stock.

Yes and no, because with the day-to-day, it’s not like he’s going to check with every decision he makes. John, what were you going to say?

I was going to say that similar to what you were talking earlier about it hits you at the heart. You’ve been here with this company, understanding who they were, and believing in their premise and the promise. John Foley is the head of that entire thing. Even though we’d been hearing for a while from a lot of folks like, “This is what should happen. This is the change that needs to occur.” When it actually occurs, you go, “Damn.” I feel you with that.

I do like the idea that this guy came from his background with Spotify and Netflix. A lot of people lose sight of the fact of what Peloton is or they misunderstand what it is. They think it’s an exercise equipment manufacturer. It’s really a streaming service and a content delivery service with a proprietary device. Spotify doesn’t have to sell you special equipment to use it. Netflix doesn’t have to sell you special equipment to use it. Can you imagine where Netflix would be if they could get all those people to spend $2,000 on equipment to use it, and then pay three times as much a month? I don’t know that Peloton is positioned as poorly as people are making it out to be. Bringing in a guy from Spotify and Netflix shows that internally, they get the direction of what makes this company different from Bowflex, Echelon or any of that.

I agree with you on all of those fronts. They would have had 2.8 million connected fitness subs and 6 or 7 million members. I’ve got to assume that they are already gaining some 250,000 new connected fitness subs every quarter. Someone who is experienced in this space around subscription-based products sounds logical. We already have something. What can you do with that? I’m interested in seeing it.

I’ve got to hit John Mills with another basketball analogy. I’ve said this before. Peloton is a 7-foot basketball player who can’t dribble a basketball. It’s impossible to teach someone to be 7 feet tall in height, just like it’s impossible to have a 90 net promoter score that Peloton has, which is the highest ever. You can’t teach that, but you can teach that 7-foot player how to dribble as easily as they can teach Peloton to be financially disciplined. What they have is so hard to get. They have that community. What they can change is as Foley said before, “Back to basics.” That’s all they got to do and it’s not going to be quick.

Had you said they were like a 7-foot basketball player that didn’t know how to shoot free throws, I would be like, were they the Shaquille O’Neal of the device? Is that what you’re saying?

I think we got Shaq.

I am curious what everybody’s thoughts are about some of the other changes they’ve made. We’ve got the pop plant closing. They’re going to sell the property. They’re going to sell the shelves that are there. I am saddened by that, although I think it’s the right call by far. We have Jill Foley leaving. She is no longer going to be in charge of the apparel. We also have William Lynch change his position. He’s now a full member of the board. They’ve added two more board members. I don’t know everybody in the management area that has left. We know it was 2,800 employees. I want to get your thoughts on that. I also want to make sure that we focus on the employees that are gone because they are a huge part of the story as well.

William Lynch is gone as well. He’s on the board but he’s no longer the president and Foley. Barry steps in both roles. I don’t know the consequences or the disparity between those roles or what that means. I found that interesting that they field him to do both of those roles. I’d be interested, Bill, if you have any insight on what that may or may not mean. Ultimately, all of the moves that I’ve been seeing and the things that they’ve been talking about seem to align with what we thought with the roles with regards to hardware, the engineering lead role. That makes sense.

We’ve been talking about the products that they’ve been releasing, whether or not those make sense or are aligned with where the space is going, are they doing those things quick enough, or are they innovative enough? To me, that made sense. The individual that was the head of their global commercial business. I started thinking, much had happened around that. You’ve heard the scrutiny around that. I guess if the scrutiny is true, then that makes sense.

Look back and appreciate how far you’ve come. Share on X

It’s hard to say because there’s also a lot of scrutiny around Jill and the apparel. I know the apparel blew up in 2021 and a lot of changes have occurred. I’m not sure I agree with, “She never should have been in there. They only hired her because that was his wife.” I’m not sure I agree with that. Maybe it’s the human in me, but it’s easy to sit here and point fingers and shake your finger at them whenever we’re looking back. I don’t know that other people would have made other decisions going forward. You have to remember how quickly they grew. They grew so fast.

As I said, they gambled. Do you remember when they would have the new product releases for apparel and it gets sold out right away? John Mills was talking about it. You’re just throwing it over your shoulder and swish. Everything was going so right for them that they got high off their own supply and they took a big bet. Elon Musk took a huge bet too and it paid off. If it wasn’t the right scenario, if he didn’t get government funding, if it wasn’t right when GM was going under, everything aligned for Elon Musk to look like a genius. The opposite happened for John Foley. The worst-case scenarios played out. It’s unfortunate, but I respect that he took the risk.

I also love that Barry McCarthy has taken on the role because he is a visionary. He has worked with Reed Hastings at Netflix for ten years, and Daniel Ek at Spotify. What I like most about him is he’s in bed with TCV. Jay Hoag is head of TCV investments. He is the reason they did that capital raise at $46 a share. He bought $100 million shares. Barry McCarthy has been on the board of TCV as an advisor for ten years. He and Jay are pretty tight.

For people that are foreign to Jay Hoag, he is the godfather of software investments. In 2011, when Netflix went down to $8 a share, who also bought $100 million worth of Netflix or some crazy amount like that? It was Jay Hoag. He did the same thing with Peloton when it dipped down. Jay Hoag has so much experience. I think he and Foley probably said, “We need to get Barry McCarthy in.” Barry McCarthy already had success in companies that Jay Hoag has large investments in, which we talked about Netflix and Spotify.

We have a great team and what’s great about Barry McCarthy is he got such a good incentive in terms of stock. He got an option to buy $8 million shares at yesterday’s close and it vests over four years. If the stock goes to $102 in four years, he makes $500 million. If the stock goes to an all-time high at $165, $171, he will make over $1 billion. This guy is like MJ coming out of retirement right now. I was like, “If I’m 69, 68 years old, I’m going to be on the beach with a Corona.” This guy was like, “I’m not going to do it.” They then gave him this stock offer and he was like, “You know what? I can hold back on retiring.”

That talk about a generational company is like generational wealth. Not that I’m sure he was hurting in the first place, but that’s the money that sets up your great-grandkids.

That’s Rockefeller money.

Back to the employee situation, let’s drill down on that for a little bit. There was a lot of flak about them keeping their Peloton subscription for a year. That became a bit which I thought was so ridiculous because if they shut it down, people would have been mad about that. It’s not as if that’s the totality of their severance package.

From that perspective, that makes a whole lot of sense. That’s not the way I initially saw it in my brain. I was thinking, if I was in love with the company I work for, and one day I show up and they tell me I’m gone, I may not be so fond of them anymore. It’s like, “By the way, you can see us every day on your screen, but get the hell out.” That’s the part that made me go, “Maybe they shouldn’t have told us that aspect of it.”

I get what you’re saying but if they take it away now, it looks petty. In terms of that aspect, it’s damned if you do, damned if don’t. If I worked for NBC and I get fired, I’m still going to watch Seinfeld.

Don’t forget that working out is stress-relieving, and not having a job is stressful. You also can’t sit there and say, “We’re a company that talks to our clients and we say, ‘This is so good for you. This is so healthy.'” Now they are going to let all these people go without any mental health help. It’s not like professional mental health. I don’t mean it like a replacement for true mental health treatment, but it can help with depression, anxiety, and a lot of things that people have been known to experience during a job loss.

Especially in situational depression, not necessarily clinical or chemical-based depression.

The good thing is as you look at the post on LinkedIn and the community in general, even in my group, there were folks that had been laid off and they were announcing it. People are reaching out and saying, “We got some openings here. Why don’t you come over and talk?” I started seeing that and that was wild. We saw that started happening on LinkedIn. In the end, I’m reading these things and realizing that my context of how they are emotionally after this happened relative to that company looks a little bit different. They still hold that same fondness. They’re just disappointed that they are not there. That changes the perspective.

It depends on where you sit and what you did at the company. The reason I say that is because that might have depended on how you were told. It also might depend on when you were aware that it was happening. I hear that logistics was affected the greatest numbers. It’s like 1,800 out of 2,800 employees. The people who were out in the field ops didn’t necessarily know or they hadn’t had this much reiterated to them over and over again as office employees that this was coming people. This is all my understanding. My understanding from the people in the office is they knew that this was openly discussed in meetings that this is totally coming.

People weren’t like, “You’re all going to be fired,” or anything like that. It was like, “We got to right size. We got to look at how much we’re spending operationally.” People were not unaware that this was coming, at least from an office perspective. Also, there’s no good way to tell 3,800 people simultaneously that they lost their jobs. When they closed down Sack and these other channels and it happened overnight, there were a lot of people who felt that was not cool, but you can’t have that many conversations simultaneously. It’s impossible. I don’t mean to take that like, “Get over it.” It still hurts and it sucks, but I don’t know that there’s a better way.

Here’s the thing, Crystal. In that conference call, they said that they had been planning this and going through strategy for the past several months. They knew this was coming. Why didn’t they start the conversation several months ago? I remember what you said the last time in the call or on Facebook, “This is not a decision to make lightly.” I totally agree, but if you knew this was coming for several months, don’t you think you owed it to your employees to maybe start the process earlier. Maybe send an email.

He did though. Whenever the leak came out, he sent an email then saying, “We’re looking at this. This is going to happen.” He never said, “Nobody’s going to lose their job.” He said, “We’re looking at it. I don’t know what those decisions are going to be.”

If you telegraph that too far in advance, that can make a bad situation worse. What is that going to do to your stock price? You can also cause a mass exodus of staff. You might end up causing people to leave that you don’t want to leave. If you’re not saying specifically like, “Drone 319, you’re the one getting shit canned,” drone 320 might leave and he or she is the drone you wanted. It would be nice but from a strategic standpoint, I don’t know.

From the human perspective, it’s very easy to be like, “You should have told us ahead of time.” I know that companies do try to do that. Especially whenever you’re talking on a small scale, it’s easier to do. When you’re talking 3,000 people, that’s the size of some towns. That’s a lot harder to be as one-on-one as you want it to be with that many people. Don’t get me wrong. Maybe there is still a better way. I don’t know what it is. I’ve had to be part of these conversations in other companies and it’s never easy.

There are worse ways to let people go. Some ways are worse than others, but I have never heard anybody that has been let go and they were like, “They did that well.”

I feel both sides of it. As you said, you’re somewhat in between a rock and a hard place. Inevitably, you’re probably not going to do this very well. You’re going to make mistakes. You’re going to screw some stuff up. That just happens. What is interesting to me about the earnings call that resonates heavily in my mind, to Bill’s point, is they clearly had time to think about this. We saw last quarter that they dropped guidance by $1 billion. This quarter they drop it by another $1 billion. During fiscal Q2, they knew clearly that, “We’ve got to do something big.” I hear you, Bill. That resonates with me.

Did you guys hear about the virtual all-hands meeting that went to welcome the new CEO?

John Foley spoke and he took full responsibility for all of this. He apologized multiple times. My understanding is he was emotional during that conversation. He read emails from people that had lost their jobs. He said he read an email that was positive and he read an email that was not positive, then he apologized again. Barry spoke as well and talk to them about how he’s going to be doing things. He reiterated that he’s going to have John involved in the strategic vision of the company, and that he’ll be running the day-to-day. I also was told that, depending on the employee, there were a wide variety of reactions out there. There are reactions that are angry, understandably. There are reactions that are like, “We figured this was going to happen.” There’s a huge variety. It’s going to take some time as a company to heal from that as well.

I bet you a lot of these employees thought, “This is going to be my career. This company is growing so fast and so well. This is like getting hired at Disney in 1940. This will be what I’ll do for the next 30 years,” and now not so much. I’m sure that there’s some frustration in that regard.

There’s one I’ve heard that I did not realize. Apparently, a few individuals had accepted promotions recently, and had they not accepted that promotion, they would still be at Peloton.

That’s got to sting. Let’s talk about who’s not getting laid off, which is any of your instructors. I don’t think they should be. I get that it’s not necessarily the best optics, but at the end of the day, this is your brand. That’s almost like Coca-Cola is saying, “Do you know what the solution is, what if we made less Coke?”

Did you see the Blackwells deck where they started talking about their brand? They show the instructors, their social engagement and following. That alone to me is why you can’t do that.

Cody is the only instructor that has passed a million, but Robin is right behind him.

Ally was right on his tail.

The community is so comfortable with these people. It’s like watching a morning show for a Baby Boomer. I don’t know what morning shows they watch but like ABC morning. You see them every day and they start to become part of your life. They’re already embedded in the community. It sounds awful because they’re getting paid $500,000, but it was the right business decision.

If they got rid of one of these instructors, they are going to pop up instantly at Bowflex, Echelon or something like that, and have it rammed right down their throat. I feel bad for the 2,800 people that lost their jobs, but if you start shedding instructors right now, you’re jeopardizing the jobs of the people who are still there. This is what this company does. This is what differentiates them at the end of the day. People can make a clone of their bike but they can’t make a clone of their instructors. If they start getting rid of them, that’s when it starts to circle the drain.

Instructors will always come and go. They’re human beings and they’ll make decisions. They have free will and agency. I don’t mean to say that no instructor can ever leave or if an instructor does, it’s the end of Peloton. If the belt-tightening means that they’re changing the product that the end-user is receiving, that would be a major alarm bell. That’s a sign of defeat if that’s what belt-tightening resulted in. It would be a major sign of blood in the water, way more than what we’re currently seeing. This is a draconian measure to right the ship. If they start getting rid of instructors for fiscal reasons, they got way bigger problems than what we’re seeing right now.

I don’t think every instructor makes north of $500,000. That’s your legacy instructors like Robin and Jenn Sherman. I don’t think it’s everybody.

Some of these headlines are very convenient and they’re going to generate a lot of discussions and probably a lot of clicks, and a lot of use, talking about the instructor not getting cut or the previous thing we were talking about with regards to they were given free membership. I’ve seen articles on both of those things. I think they’re just very convenient articles.

Lauren Thomas just wants the click baits. I know you guys think after that conference call that there’s no Peloton acquisition deal. It’s probably lost. I don’t think so. If it were to happen, it’s certainly going to be delayed. Peloton wants to sell from a position of strength, not from a position of peak vulnerability where they are at. The stock should not have gone up 50% based on those earnings. To John Mills point, $5.4 billion to $4.4 billion, then they cut it by another billion, it was worse than I thought it would be.

 

How often do you see rumors about the biggest, best companies in the world in different sectors, potentially competing for one company like Disney, Nike, Apple, Amazon? This is unprecedented. I don’t know if you guys are familiar with WallStreetBets meme stocks. We’re seeing a little meme action going on. I don’t know how long this will continue, but it’s happening at the perfect time for Peloton because all growth stocks in the last few days have jumped. This news came out at perfect timing. Peloton has a high short interest. That’s giving the stock some boost too.

I don’t think an acquisition deal is more close now. It’s close to John Foley but it’s still a little further now after this. Now he’s a little more business-centric. Everyone there is a little more business-centric. It might not be, but I think Barry’s mission is to package Peloton in a nice little box with a nice ribbon and bow and get north of $100 a share for the company. How long that takes, I don’t know. It’s going to take a while. There are some deep systemic issues in that company. They’re not going to see the adjustments on the logistics side and manufacturing side and Peloton’s Ohio park until after the fiscal year 2023 on some of those things. It’s going to take a while but the stock said, “Screw that. I’m going up 50%.”

There’s some meme mania right now. I still think the stock is undervalued. We talked about this last time I was on the show. There is more upside than there is a downside. Since I’ve been on the show last time, one thing that’s different is a lot more other stocks that are growth-oriented compared to Peloton are down a lot farther than when I made that last statement. When someone made 50% on Peloton in five days, are they now going to jump into Facebook that’s down 40% in the few three months? I don’t know. I can tell you this, the stock price going up 50% based on those earnings is a little irrational from the market because it’s not proportional to the earnings call that I’ve heard.

They’re just happy that John is not in power. That’s how I took it. They were like, “You got him out of there. Good.”

Some are happy that he’s gone. Some are happy that they are doing something. This feels like a real plan and they brought in a real guy with real experience. I don’t think it’s an F you to John.

You can tell I keep things personally. That’s how I would have seen it.

A year from now, are we going to be hearing, “Blackwell was successful in ousting the CEO of Peloton.” Are we going to see that article?

No matter what happens, they are successful because he left. Can I just say that they’re not successful because this conversation was clearly happening months before Blackwell did their little thing? That is how they’re going to spin it. That is how history will remember it, but we know the truth that is not what happened. It’s important for people like us to remember that and to say that now. To Bill’s point, I hope that they don’t sell the company. I don’t want them to sell. I think that a key here is not only is it possible they’re trying to get the price up, but with John not being involved in the day-to-day, now it’s easier to let go. Over time, that makes it easier to be like, “I had my run. It’s okay.”

How old is John Foley?

Right around 51 to 53.

If it takes them 5 or 6 years to get this to where they want it to be, now he’s pushing 60, all of a sudden he’s like, “You know what? I can sell this and make $1 billion.”

I don’t want to see the big evil corporations win. This was the statement I put on Twitter. The worst short-term catalyst or the worst short-term event for Peloton shareholders is that there’s no acquisition deal. That’s the worst thing that can happen short term for Peloton shareholders. The best thing that can happen long term for Peloton shareholders is that there’s no acquisition deal. Peloton used to have 50% gross margins on their equipment. That would cover all the customer acquisition costs. Peloton was getting these customers before they made these price guts. They were getting these customers for free, then the subscription revenue was coming in and it was infinite. Good investments are something that you find 5X the return of customer acquisition costs.

Peloton is such a unique model. It was getting its customers for free just because the margins were 50% on that hardware. We’re going to go back to that model now where we’re getting those customers for free. We’re going to start with an $800 million savings in run rate. We are going to get back to that model where we’re making 50% margins on customers. When we have all these new products coming out, it’s a no-brainer that you got to make these products more expensive because the community is incentivized to buy these products. You’re still only paying $39 a month, no matter if you have a bike, a tread or a rower.

The analogy I like to use is to imagine in your household you get a Kia. You got to pay gas on that Kia. You get another Kia and that gas is free for life. That’s essentially what that $39 a month is. It’s such a compelling value. We’re not realizing it yet because we don’t have those other products there. We won’t have those other products there if we spend so crazy like this. Now Peloton is telling us that they are going to have $1.2 billion in cash at the end of this fiscal year, after making the cuts. They are going to have $500 million in revolving credit.

Their balance sheet is going to get back to where we need it. We’re going to have that sustained profitable growth. We’re not going to have that crazy growth as we wanted. That crazy growth that we wanted was at a cost because we were losing money on every sale. Now that’s not going to be the case. We can go at a slow organic growth and be that $300 a share company that I still think Peloton has a strong shot to be.

I got a question for you, Crystal. I share this sentiment so I’m not challenging it. This is layman John asking these revolving questions. Your sentiment around you’re hoping that they don’t get acquired, is that related to your emotions around who Peloton was before the IPO?

Absolutely. We’re never going back to those days. The biggest upset feeling that I’ve had in the last few days is because of that. This made me realize that. I have grieved for that. I never thought we were going back to it, but there was still this tiny hope but it’s gone. There will never be that again. We’re not going to have a homecoming where we get together. I talked to you about a podcast. That’s the first time I met you. That’s not going to happen. We’re not going to get together in a room at a cocktail party with the instructors. It’s never going to happen. I don’t want to lose the heart of the company. Now John is gone and Jill is gone. That was a huge part of that heart. The last beat of that heart is the fact that it’s still Peloton. If you sell it, it’s gone. It’s dead. Forget it.

I was in my Clubhouse. We did an urgent Clubhouse meet up right after earnings. We had these disparate groups of people. We had the people that were around pre IPO that remember all that stuff and are likely investors because they felt all that. They dove in when the IPO happened. They were going to get something. We had the newer folks that have been around a shorter amount of time. They don’t know a Peloton prior to that date. They may or may not be investors. They are probably not. Their mindset is more about, “I get on the bike and there’s Alex so I’m good.” They don’t get the emotion.

You got on this one side and they’re all emotion. You got the other side talking about the artist series that came out. There are these contention and different mindsets. I’m with you. I was hoping that we would get back to that or some semblance of that. I resigned myself that that’s not going to happen. They are a public company now. They’ve got shareholders to align with. This is a different space now. When we start talking about acquisition, I might get a little stabbing in my chest but I’m not opposed to it. I’m going well. We’re in a different world now.

It’s the nature of things. All I can think about is a picture I saw one time in one of my nerd magazines. It’s from the early ‘70s. It’s these people in a hotel conference room and they were getting together at one of the first Star Trek conventions. This guy is sitting there with storyboards for this thing he’s doing. He’s like, “This is a project I’m working on. I hope you Star Trek nerds will support this thing.” That head nerd with the storyboards was George Lucas. He was trying to get them to go see Star Wars when it came out in a year. To show you how growth works. It’s not just Star Wars. That little Star Trek convention is now the San Diego Comic-Con. That’s the nature of things. I hope Peloton becomes Star Wars and we become the San Diego Comic-Con.

I don’t want to lose the community. I don’t want to lose the connection.

The community is magic. I still don’t even get the secret sauce to that, but they are magic.

It’s timing. Before we wrap this up, is there anything or any element aspect of this that we haven’t turned over and picked apart that you guys would want to tackle?

It’s the end of an era. I’m sad.

Did they say that by end of fiscal 2022, they were going to have three million connected fitness subs? I think they’re going to have that by end of Q3.

They cut that big time too with the revenue. It’s blood in the streets but investors don’t mind it because we felt like we were being lied to. It happened with the whole. It’s like, “We’re not doing a capital raise,” then they’re doing a capital raise. “We’re hiring 3,000 employees,” then two weeks later, they’re doing a hiring freeze. We felt like we were being lied to. Finally, they are now on the same page with us. They are telling us the facts and the plan. It’s giving people hope. This 50% pop is a little irrational because the numbers were pretty bad. When you try to look at the stock price short term, flip a coin. If we stick to when in doubt, zoom out, in ten years, we’re going to be on a beach and we’re going to be cheers-ing each other because we’re loaded from Peloton stock.

We don’t know each other in ten years because they will have been bought.

I believe in this though. We’re going to be like Eddie Murphy and we’re going to be on the beach.

I’m joking, but to add to your point, if you think about where everybody else is in connected fitness right now, there are a lot of Peloton competitors that are doing worse than Peloton. Peloton is just getting all of the attention.

Peloton gets all the attention because it’s one of those products that anybody gives a shit about.

Did you guys hear that iFIT hired bankruptcy lawyers?

We know that they’re going through that issue. I didn’t know they had hired the lawyers. That’s fascinating.

They hired bankruptcy lawyers. They’re imploding right now. We’re fixing it but here’s the problem. We spend eleven times on content compared to iFit. Why are we charging the same as iFIT? If you’re the best in a sector, you control pricing. They asked Steve Jobs in 2005, “What do you think? Your products are so expensive. You’re going to leave out the middle and lower class. How do you feel about that?” He said, “I just don’t feel right selling crap to people.” The stuff that I don’t want to sell to my daughter, I’m not going to sell to someone on the street. Peloton is the best. We can charge more. We found out that cutting the price didn’t increase any sales. Now we have a plan.

I don’t know that they should charge more. I get what you’re saying about the price points being the same, but I don’t think it’s because Peloton is charging too little. It’s because iFIT is charging too much. They looked at what Peloton did and said, “If they’ll give them 40, they’ll give me 40.” That’s as much thought that went into it.

You’re right, Tom, because they’re going to go out of business and then Peloton can say, “Now we can charge more.” You make a good point.

If they do go out of business, where are those people going to move to?

That’s very true, Tom. Also, as far as the pricing goes, I’ve been saying for a very long time that as they add new products, do not be surprised if that price goes up or become some add-on thing.

If you want your Guide to work, it’s $45 a month.

I still think that is an option, especially with everything up in the air right now.

They’re going to do freemium. That’s an idea being thrown around where they’re going to have different tiers for the digital app. If you want the cheaper one, then there are going to be ads at the start of class. Crystal, I know you probably hate that. I don’t want to be in the middle of meditation and hear an Arby’s commercial.

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I think there needs to be a freemium. I’m okay with that because I’ll gladly pay for it not to have any ads. That’s what I do with everything. I don’t watch commercials. I don’t like them.

Before you start talking down commercials too much, don’t forget we do run them.

I was thinking that. People are going to be like, “You are critical,” but they get this show for free on the other hand.

As we speak, Nautilus earnings call is going on. I’m going to go and check it out after this. I don’t know what’s been going on with them, but I know iFIT has been struggling and we’ve been seeing them floundering and battling. I’m interested to see what’s happening with the other players in the space. Nautilus, specifically.

You’re going to have to update us, John.

Thank you guys for joining us. We appreciate it. Bill, before we let you go, where can people find you?

You can find me at @Wild_Bill32 on Twitter. I am formerly known as PTONgains, now it’s PTONpainz.

John, where could they find you?

They can find me on my Facebook page or group, Run, Lift and Live. They can find me on Instagram @RunLiftAndLive. They can find me on TikTok Run, Lift and Live, or they can find me at RunLiftAndLive.com.

Thank you, guys.

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Joining us once again is Dr. Jenn Mann, licensed marriage, family and child therapist, and sports psychology consultant. She also has an app called No More Diets that you might find helpful or useful. Ladies and gentlemen, and all points in between, it’s Dr. Jenn.

It’s great to see you, guys.

Thank you for coming back. We have more questions from The Clip Out group. This one is from Jacquelyn Jax Ash. This is probably a weird question. She hates Power Zone. She says, “I see the value in doing the challenges every so often because I see marked improvements. How do I motivate myself to do something I know will help in the long run, but when 6 to 8 weeks of it seems so freaking long?” I am fascinated to hear your answer.

Is she talking about doing an actual Power Zone program or one single Power Zone class?

She’s talking about Power Zone challenges run by an independent thing that they have outside of Peloton. A random person is putting together these challenges. That’s all based on a whole bunch of Power Zone classes. They have to do it for 6 to 8 weeks and it’s a team. You could do it solo but if you’re in a team then part of the pressure is you’ve got all these people depending on you. You can also do it solo. I don’t know which one Jacqueline is doing. As you go through it, in theory, your FTP should go up over that time period, which is why she feels compelled to do it.

I am a hardcore Peloton addict. I workout seven days a week. I have two treads. I have two bikes. I wear the clothes. You can’t find me in a 24-hour period without something polished up on me, but I would rather stick needles in my eyes than do that. More power to you. Those of you who are doing that, I bow down to you. I respect you. I think it’s awesome. Here’s what I’m going to say. You don’t have to do everything just because everyone else is doing it. It’s it improves you. There are a lot of different ways to improve your output. I had been doing Peloton for three years and my endurance has improved so much. When I first started, I could barely get through a twenty-minute ride at a five. Now, I can do an hour run.

My baseline run is at a six. What I’m here to tell you is that is not the only way to improve. I’m a big believer that the exercise should be doable. Sometimes it can be difficult or challenging. It should not be something that fills you with dread. We should be picking things that help us to get stronger and better, that are the least horrible that we can pick. I’m a big believer in pushing ourselves but also pushing ourselves with the things that we enjoy. Maybe what the compromise for her is instead of joining this power group or this endurance group, maybe she makes a commitment once or twice a week to do a Power Zone class. Look at her metrics so she improves the same amount over the course of one year that she might have done in an intensive 2 or 3-month period.

She still is finishing that year and loving exercise, loving her bike, looking forward to it, having a positive association. When we create too much of a negative association with exercise, we’re going to at some point, get burned out or not do it or get injured. More power to those of you who are doing that. It’s amazing and impressive. I am not a Power Zone gal. I aspire to do a little more but for me, the thought of doing that does not sound fun. I like my exercise to be fun. I like for other people who are inspired by this show and by Peloton to have great experiences. Do a deep dive on what other ways you can improve your endurance.

Sometimes strength work can improve your endurance. The one thing that I do that I don’t like, but don’t hate is HIIT cardio. I incorporate it into my exercise plan in 2021. It’s one of those things that every time I do it, it is so hard but I enjoy the challenge. I don’t totally hate it. It’s like, “I thought I was so much better than this. I thought my endurance was better. I thought I was so much stronger.” That I’m all for. Look at where else you could incorporate things into your plan, whether it’s strength, whether it’s some HIIT cardio classes, whether it is doing the Power Zones once or twice a week, or maybe adding in some running to your regimen or some outdoor running. There are a lot of different ways to improve your endurance. That’s not the only one. Do something that you love.

I wholeheartedly agree with everything you said. I would also add that this is another vote for her doing strength. The improvement that she is specifically talking about is the output going up over time. I know that doing strength can have similar results. Taking those classes a couple of times a week, and also adding in more strength, she could get the same results without being miserable. That’s fantastic advice. That was a very specific Peloton question. I love that we can hit those like that.

I love that I can talk about my obsession with you guys.

You can’t get Peloton specific advice like that in other places. This is where you go for stuff like that. Thank you very much for helping her out. Until next time, where can people find you?

You can always find me on social media @DrJennMann. You can find me in my weekly InStyle magazine column, Hump Day With Dr. Jenn. That’s all about sex and relationship advice.

—

Back to regular Peloton news.

Who knows if this is even still valid after everything that’s occurred. I think it is.

I don’t know why everything that happened would prevent this from occurring. Lanebreak, the video game that’s the gamification of Peloton that has been beta-tested will be rolling out soon according to our Peloton Prophet.

Valentine’s day is the big day. Hopefully, we’ll all get to play a little Lanebreak and check it out. Tom, are you going to join me for Valentine’s day and play a little Lanebreak.

I got you a Lanebrake for Valentine’s.

Are you going to play the lane break with me? I want to do something with you.

I can stand there and make Pac-Man noises while you do it. That’s the closest you’re going to get. If you’re looking for a different way to get your cardio going, you should check out FightCamp. It blurs the line between fitness and gaming.

The gaming aspect of it is so fun. You get to see how many punches you should be hitting and you get to try to beat it. It brings out that competitive side. Also, it is fun to hit things, like to actually have something in front of you to punch. I love that feeling. I feel very empowered when I punched that bag.

They have quick workouts. They maximize your efficiency with high-intensity interval training, and you can get a killer workout in as little as twenty minutes.

You need zero boxing experience. They have programs that take you through the beginner all the way up to being awesome at it. It’s a full-body workout so no need to worry about if any of your fitness is missing.

FightCamp comes with all the gear you need to start boxing from home, including a free-standing punching bag, boxing gloves, quick hand wraps and smart punch trackers. It takes up less space than you think. If you have enough room to do a push-up, you got enough room for FightCamp.

FightCamp offers easy payments so you can get your equipment and get started. Pay over 24 months for less than the cost of a gym membership. Plus, FightCamp offers free shipping with a 30-day money-back guarantee. Go to FightCamp.com/clip.

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Believe it or not, there are still other things to talk about with Peloton In The News that aren’t catastrophic. There was an interesting article from CNBC. Steve Kovach, which I believe is Crystal’s pseudonym because he’s saying exactly what you’ve been screaming from the mountain tops that people have been ignoring, which is Apple’s acquisition history shows why a Peloton buy is out of the question.

Thank you, Steve. People now listen because you are a boy.

The article talks about if you look at Apple’s history, they don’t tend to buy companies that are that highly valued. The closest that you have is Beats, which was $3 billion, which for Apple is nothing. Other than that, most of them are more of what they consider acquihires, which is they acquired the company to get the staff more than the actual company itself. They definitely agree with Crystal that Apple is probably not interested in Peloton.

There you have it. I like Steve.

Also, Mashable has an article about how Peloton would be so much better if it let you stream stuff like Netflix and Stadia.

I told this guy off on social media, he doesn’t know it because he doesn’t know who I am, but I tried to add him everywhere I could because he’s wrong. Here’s why he’s wrong. Even if you want Netflix on your equipment, that’s not the issue that I have with this. The issue I have with this article is that Adam thinks that it is an oversight and it is not. It is on purpose. It is a feature, not a bug. They want you to be focused on a class.

As we talked about earlier in the earnings call segment, the product is the instructors. That’s what creates the engagement. If you watch Netflix, your bike will become a clothes hanger for most people. I know there are exceptions. If you want to watch Netflix, there are easy workarounds, whether it’s slapping an iPad up there or putting a TV in front of your bike or jailbreaking your tablet if you want to void your warranty. For most people, if you give them that option, it leads to them using their bikes less.

 

I know that’s not everybody. There are exceptions to that. This is not to be mean to people who don’t want to workout hard all the time. There are plenty of good reasons that you would want to take it easy and ride a bike nice and easy, or walk on the treadmill nice and easy. The point being, it’s not because Peloton didn’t think of it. It’s because Peloton thought of it and discarded it because for the most part, that’s not what people want. When you look at their engagement numbers, it bears out. They’re right. They have the data to back that up. There are people that still want that. As you said, Tom, there are workarounds.

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Joining us once again is Angelo from MetPro here to answer all of your nutrition questions. How is it going?

It’s great to see you guys. Thanks for having me back.

Thank you for coming back because we need your help again. Last episode was all about our hungry listeners. This episode, it’s all about our craving listeners. We got Tammy Barnetts. She says that she craves food that is not good for her at night, specifically sweets and carbs with fat like toast or buttered popcorn. We have Jody McCammon. She says she eats too much sugar. Darcy Bulger is getting over the sugar habit she developed between Halloween and the holidays. Help.

Craving is something that we all deal with. If somebody says they don’t have them, they’re lying. Everybody has cravings from time to time. Sugar is the only thing we’re born addicted to. Here’s the deal, from a practical standpoint, what I try and tell my clients is to deal with cravings, not cravings and hunger because you’re not going to win that battle. Chocolate cake tastes good. That’s never going to change. You’re always going to like chocolate cake. What changes is the environment.

When you walk by the bakery and you’re starving, you’re going to go and you’re going to grab some treats or something sugary. When you walk by the bakery but you have already eaten a healthy meal, now only sometimes you’re going to indulge in the treats. That’s the trick. I will swing around to, “Here are some good snacks that you go to if you have a sweet tooth,” but the big picture and more importantly, if you were my clients and we were visiting and you said, “I’m struggling at night after dinner with snacks,” my next question is going to be, “I want to know how dialed in we are at our mid-afternoon snack.”

I would probably even enlarge your mid-afternoon snack that’s not substantial enough. You will be amazed at how adding a mid-afternoon snack will stabilize your blood sugar. When you come to dinner time, you’ll still be hungry but you won’t be ravenous. You won’t be having this massive blood sugar spike and drop that causes the nighttime cravings. Again, chocolate cakes still taste good. My advice is don’t keep it in the house. You’ll end up selecting something more nutritious.

That brings me to my second recommendation. First is a mid-afternoon snack, something simple and clean. I’m always a big fan of nuts and fruits. Keep it simple. My second recommendation is don’t keep it in the house. I know this isn’t viable for everyone, but I can make a very potent argument for the practicality of this. My clients are very motivated right out of the gate. Week two, week three, they are dropping weight. They are seeing their bodies change right before their eyes. I asked them about the pantry and they say, “We have the Oreos. We have the nutter butters but that’s for the husband or the wife or the kids. I won’t get into it,” but you will.

I’ve done this a couple of times. The thing is you may have willpower, but willpower is secondary to practical application. When we assume that we’re not going to get into something, here’s what you’re signing up for. You’re signing up for never being exhausted, never having a long day of work, never having something unexpected in your life pop up, never having something unexpected for your family’s life pop up, and never dealing with excess stress. All of these are triggers. You’re going to say, “I’m dealing with this. I don’t want to also deal with that. I deserve to have a night off.” That is okay because you’re right. You do deserve to have a night off. When you take that night off, I’d rather you not have chocolate cake in the fridge. I’d rather you have a night off with other foods.

Practical steps and trust me, I’ve done it myself. I don’t eat Oreos by the twos. I eat them by the sleeve. That’s why I don’t keep them in the house because if I keep them in the house, I’m going to dive into them. Rarely will I at 8:30, 9:00 at night go and say, “I’m going to put on my blazer. I’m going to grab the keys. I’m going to drive down to the gas station and grab myself a treat.” Most people will not get dressed, drive down, and grab some treats. It will happen less often. What are the options in your house? There should be good options. I’m a big fan of fruit and all the different things that you can do with fruit. One of my favorite recipes at nighttime is Greek yogurt and strawberries. Try putting it in the blender, put a non-artificial sweetener or something like Stevia or even a Truvia would be okay. Mix it up in the blender, put it in the freezer for 10, 15 minutes to chill it a little bit. It’s delicious. It’s a wonderful snack.

My clients do frozen blueberries, then they put a little bit of Truvia over it and it’s sweet. It gives them something to look forward to. If you’re a nighttime snacker where you prefer something savory, I like doing low-fat string cheese melted over sliced apple. You can even put a little garlic powder or salt on it. My favorite is savory. I struggle with the salty, so I’ll get in trouble with the Oreos, but a bag of potato chips is even more deadly. I can’t keep that in the house. What I do love is I’ll use either ham, turkey or roast beef like a roll-up, but instead of using cream cheese, I’ll use a little cottage cheese, just a dollop. In the context of that ham or turkey roll-up, the taste is very similar and it’s very satisfying.

There are lots of little tricks you can go to if you’re genuinely hungry. I tell people, first, go back and have another serving of your healthy foods that you had at dinner. If you still want to treat after that, go ahead. You’re not going to have as much room in your belly so the treats will be more modest-sized. There are little trick tricks to minimize. Just to recap have an afternoon snack to stabilize your blood sugar. Go with foods that are going to be more filling. At nighttime, you can have snacks that are clean and healthy, and do not keep junk food in your house.

Thank you very much. If people would like actual nutritional advice, where can they find you?

They can find me at MetPro.co/tco.

Thank you.

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Alex Toussaint has some fun news. The NBA All-Star game is around the corner. They have a celebrity game where various famous people get to play basketball. He is going to be one of them.

He’s on team Walton. Did you see that Tiffany Hadish is on the other team?

I did see that, so is Kane Brown. I was looking at these and I feel so old. I know almost none of these people. I knew Alex Toussaint, Kane Brown and Tiffany Hadish. I think that’s it.

Machine Gun Kelly, you know who he is.

I glossed over that name. I do know who Machine Gun Kelly is because I booked him.

We know who Jimmie Allen is too. He’s a country singer.

They are going to have a Harlem Globetrotter on one of the teams, Crissa Jackson.

It’s nice to see just straight-up positive news. Can I take a little detour and talk about a class I took? One thing that made me feel a lot better and made me come into this conversation in a much better headspace was I took the 2 for 1 Black History Month run. It was with Adrian Williams and Jess Sims. It was clearly before all of this happened because they are smiling and happy without a care in the world. It put in perspective for me what this is all about.

As you said, Tom, our instructors are the product, but also the joy that they bring us, the lives that Peloton has saved, and the things that Peloton has done for us have been absolutely wonderful. It has completely changed our lives. Even you, Tom, don’t use any Peloton products but it has changed your life dramatically. I was thinking back on that as I was taking the run and it is a joyous run to take. If you were having a bad day, it is the perfect class to take. If you haven’t checked it out, please do so.

I also have to say that while I still don’t use a Peloton much to the consternation of many people, it certainly was my path to fitness even if it’s not the product I ended up using it. If it hadn’t been for your love of Peloton, we would have never been introduced to the world of Tonal and then MetPro. I would not be where I am currently at. Back into the segment itself, while we’re talking about Alex Toussaint or we were anyway, the Ride to Greatness that he’s doing, they have their official team captains.

It’s two sports people that I don’t know. Ryan Tannehill, star quarterback, come back king and Peloton member, and Greg Olsen, veteran tight end broadcaster, Peloton member. I can’t help but notice they don’t say what teams they played for. I guess if you’re into sports, you instantly know. I don’t instantly know. I take that to mean there’s some sort of the NFL not letting them use the name of the teams that they played for.

That would be my guess as well. I’m with you, Tom. I have no idea who those people are, but I know people are excited about it. I also have heard a lot of people being a little bum about that like in 2021, Hannah Frankson was one of the team leads and she pulled for her team. She was out there on Instagram every day riling people up. These guys are celebrities and they have not done that. I don’t know if they plan to.

You don’t get cured over a couple of therapist sessions. Healing is gradual. Share on X

You would think if they bring them in, they’d be like, “Here are the things you got to do.” They probably would write or tweet for them, but you never know.

Maybe we will still see that. It’s a few weeks It happens over time.

The Today show had the 20 best Peloton instructors for every type of workout.

I thought it was funny because everyone is like, “My instructor is missing off this,” because you can’t name every single instructor. I know it was 50-plus of them. There were a lot of good mentions in here. We hear a lot of Alex, Jess King, Denis, Christine and Robin. Hopefully, people that haven’t been introduced to the Peloton world see this and they try out some instructors they have not tried before.

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We have a new celebrity sighting. Donna Mills at 81 has entered the world of Peloton. She’s a famous actress. I know her because I love my movies, especially ’70s era cinema. She was in Clint Eastwood’s directorial debut Play Misty For Me. She was the girlfriend. Not the crazy one with the knife, but the other one.

One of our members posted this and the name is escaping me at the moment, but I appreciate that people send us this stuff. Thank you because I would not have seen that otherwise.

Thank you very much for pointing that out to us. While we’re talking about celebrities and Peloton, for fans of nerd-based comedy and I mean that in the best possible way, Lauren Lapkus and Paul F. Tompkins are both on a podcast and it’s exceedingly popular called Comedy Bang Bang. They make these improv videos and they have one out now called Lapkus and Tompkins: A Peloton Adventure. If you want to check that out, it’s only $5. You can find the link for that in the newsletter if you sign up at theclipout.com.

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DJ John Michael is celebrating seven years with Peloton. A lot of the instructors chimed in and made a very nice video for him.

It was sweet. If you haven’t gotten to see it, definitely check it out and sing congrats to DJ John Michael. He’s a huge part of all of this wonderful community that we have and Peloton.

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We have the latest artist collaboration. It features Swizz Beatz, a legendary producer who produced his first hit single at eighteen. You can check that out. Also, Verzuz is back with a twist.

This round, instead of being a head-to-head battle, the instructors are going to play a compilation of all their favorite songs from the battles. It’s going to be a head-to-head so you get to pick each one.

That will be with Ben Alldis, Andy Speer and Chase Tucker.

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Daniel McKenna celebrated his birthday on February 4.

Happy birthday, Daniel McKenna, and your cute little puppy dog too.

Don’t feel left out or worried, I added you to the calendar so we will do you in advance next year.

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Joining us is Megan Pace. How’s it going?

It’s going well. How are you, guys?

We’re good. Before we dig in too much, we want to put out there that in this particular interview, we will hit on the topic of eating disorders. I know some people that have struggled with that in the past don’t want to read about it. If that is an issue for you, we will see you next episode.

We get that, respect and understand it. None of us are doctors. This is Megan’s experience that we are talking about. If you are struggling with anything, please do not take this as medical advice. Talk to your doctor. Let’s start with the fun part, Megan. How did you originally hear about Peloton?

I know my daughter was in VPK. That was late 2017 or early 2018. I had a friend who asked me to go to a spin class with her at the gym. I went and a few months down the road, I was coming out of that class and ran into a friend. She had mentioned something about Peloton. I didn’t really know much about it or what it was. They hear you talking about it. I got an ad about it. I started looking into and it was the same thing everybody says, “It’s pricey.” I told myself, “For now, I want to make sure I’m going to enjoy these spin classes and be into it.”

I started going to those, and my daughter’s school was three days a week, the other two days a week. I know you will appreciate this. We live near Orlando, so we had Disney passes. She had school Monday, Tuesday, Thursday. Wednesday and Friday would probably be one of those days to go to Disney. That was also a day that they had spin classes.

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My options were to either drop her off at school and hurry to a spin class, which I didn’t want to do. I wanted to go home, have a hot cup of coffee and relax for a little bit, then go to the gym or we’d have to hurry home on those days that were out and about, and I’d try to make the 5:30 class, but you got to get there early because they have so many bikes and it’s a popular class.

It’s got to be a pain in the butt. Finally, in the summer, I ordered it and I got it on July 20, 2018. I was into it. I loved it. It was great. I was using it a lot. I remember that was when people were pre-ordering the tread and waiting for those to come out. My initial reaction was, “No. That is one heck of a pricey treadmill.” I remember telling one of my friends. I said, “Unless that thing missed me and makes me a smoothie when I’m done, I’m not getting it.”

Meantime, I was still going to the gym to lift weights and use their treadmills to do the running classes. I also had a treadmill at home. I was doing those for a while. A few months in, I told my husband, “Let’s go to Boca. I want to check it out just for a look and see what all the hype is about. I knew what I was doing.”

As a husband, we also know what you’re doing.

He knows me.

That’s why I’m never allowed to go to animal shelters.

He was a good sport about it. We made an appointment. I went down there and I remember it was a twenty-minute Olivia class and just everything about it. It felt great running on it. The class was amazing. April 9, 2019, we got the Tread+. I love the bike. When they announced the Bike+, my husband said, “I already know.” I sold my original bike, and then I got the Bike+.

I love the tread. It’s one of those things where I tend to overdo it. I have to take a break from running. I had a lot of injuries in 2019 and 2020 with stress fractures, shin splints, then I had foot surgery and a cyst on the bottom of my foot. I had to go back to the bike, and it was nice having that. I love both, but I love the tread.

I tend to gravitate toward the tread myself. There’s something about running. It’s invigorating. I don’t really understand it because, on paper, I shouldn’t like it. I love it. I can’t stop taking the classes.

I remember there was a post in the group about the whole tread thing, and they’re not selling as many or whatever. It’s one of those things where running on a treadmill gets such a bad rep. It’s so boring and, “Why? I want to be outside.” I live in Central Florida. It’s hot. I don’t want to do anything outside if I don’t have to. Being on that tread, the screen, it’s so big, but you’re just immersed in it and you feel like you’re there. There’s nothing that compared. You can’t say that’s running on a treadmill. It’s totally different.

It’s my favorite running ever. I definitely prefer it to running outside. We’re in Missouri, so it can get really nasty like it does in Florida. The last time we were in Florida and we were going on a cruise, I was like, “That morning, I’ll just wake up, go and do a quick run before we get on the boat. No.” That was like, “What is this nastiness? It was hard to breathe. I don’t even understand.” The humidity is crushing.

It’s one of those where you got to get up early if you want it before the real heat, but no. I’m just one of those people, I will not wake up to work out and our stuff are in our bedroom. My husband is sleeping. He’s certainly not going to wake up so that I can work out. When I got my year-end review for Peloton in 2019, it said, “You’re a mid-day hustler.” I said, “I absolutely am.”

I know you’ve had quite a fitness journey that’s been filled with ups and downs. Can you tell us a little bit about that?

Growing up, I’m a typical overweight child. It started in early elementary school all the way through college. It wasn’t just overweight. I was very overweight. I remember even late elementary school, probably 5th or 6th, it was a science fair or something like that. I had to get an outfit and I had to shop in the women’s sizes. It was hard.

I never had issues like not having friends or anything like that. I had a great family and friends, but it’s one of those things where I played sports and I was always the big girl on the team. In high school, I was always the big friend and all that. It wears on you. I remember it was my freshman year of high school that a girl came in and she was talking about something.

That was where I got the idea that there are ways that you could have the food and then not have the negative results from eating that. That was where freshman year of high school was where the bulimia started. It wasn’t anything to lose weight per se. It was more, “I want to eat this, but I don’t want to regret it. I don’t want to get any bigger.” Gradually, it became about losing weight.

I didn’t really lose much in high school. I remember my high school prom, I had to shop in the plus sizes for a dress. That was really hard looking back on those pictures. I used to never look at them. I hid them from my husband, but now I can appreciate where I’ve come and how far I’ve come from that. That was high school. When I went away to college, it was the same. It was harder to hide the bulimia because I was in a dorm and we had the community bathrooms at Florida State.

It stayed about the same. At the end of my second year, one of my friends from high school lived in an apartment with two other friends from high school. He was going home for the summer. I sublet from him, and now I had privacy. Things gradually got a little worse from there to where, “I’m not going to eat today.” That summer picked up, then the next year I was in an apartment again and the same thing. I lost a little bit of weight and started seeing, “Now I’m actually wearing normal size clothes.”

I remember being in college at Florida State of all places, you got to meet gorgeous people walking around like most colleges, but that’s what we were known for. Here I was wearing a size 20, and that was devastating. I had always planned to play softball when I got to Florida State. I was good at it. I wanted to play there for so many years, but I didn’t because I didn’t want to be the big girl on the team. That was something else that I lost because of my weight. It was things gradually, I lost some weight and they were getting a little more serious in that regard, and then I only spent three years there.

I graduated in 2005. My mom, we had gotten closer when I had gone away to college and she had said, “Why don’t you come back home? You can stay here, rent-free, get a job, get on your feet, get things going with your career.” I did. I moved back home. Pretty much right away, I got a job working at a bank. The schedule there, I was working is 1:00 PM to 10:00 PM. I didn’t really see my parents except on the weekends.

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What kind of bank is open until 10:00 PM?

It was Washington Mutual, but it was a service center. We handle equity loans. It was a big one. They had a call center, processing and everything in it. It was great. I get up in the morning. I would go to the gym.

It’s great for mid-day hustlers.

I sleep in. I’d stay up late and things again started to progressively get worse now that I had this freedom and I tried to hide it from my parents still, which was easier to do when I’m not coming home until 10:30 or 11:00 at night.

You’re probably getting positive feedback. People are like, “You’re losing weight.” They don’t know the method, so they’re like, “That’s great,” like that’s a natural human nature to congratulate you, which I’m sure ironically enough doesn’t help.

Especially for someone that you spent so long wanting to be smaller and it was happening, but people didn’t know that for the whole day, I wouldn’t eat. I would come to work and I’d bring some carrot sticks and an apple. That would be my meal for the day. That went on for a long time. People knew finally because I was losing so much weight and they didn’t see me eating anything. They had a big break room and I remember they had a little machine off to the side that had the blood pressure cuff, but the seat was also a scale. It would tell you your weight and BMI. I would go over there every day and check.

I could not wait. I wanted my BMI to get down. I wanted to be out of the normal range. Eventually, it got to the point where when you’re not eating, you’re eating less than 100 calories a day. I had no energy. I remember in my house walking, I would not faint, but veer off and I’d walk into the wall because I didn’t have the energy to move. I was sleeping a lot. I don’t know how I managed to keep working all that time. I had a leadership role. My father passed away in 2016, so I never really talked to him about it.

My mom knew what was going on. Honestly, sometimes on the weekend, she would hear me in the bathroom or something and she could see the weight loss that was happening. It got to the point where now I was underweight. She told me, “Megan, I see your bones. Is this how you want to live? You’re going to lose everything. You’re going to end up in the hospital.” I didn’t care.

At that point, I remember I would walk into a store. When you’re so used to shopping in the plus-size section brought so long, you walk into a store and then you’re the smallest size on the rack. In high school, I was wearing men’s clothes because of daggy hiding. I would walk into a store, I’d need to pull a small off the rack. I didn’t care. If you had told me, “You could die,” I don’t care. I love this. I’ve never felt walking into a store, not worrying about it and knowing you’re going to be able to fit into whatever they have.

It finally got to the point, I remember I had come home and I was going to take them back. I had to put towels on the bottom of the bathtub because I had no body fat, just sitting on the tub hurt. I don’t know what it was, but sitting there, I said in my head, “I’m going to say something to my mom. I’m going to ask her for help.” I was at the gym. I looked in the mirror. For once, I saw what was there. I texted my friend. I was like, “Do I look sick to you?” She said yes. She and I had been close in college.

I knew she would be honest with me, so when she said yes, I had been thinking about it. That evening, for whatever reason, because I’m like, “How have I gotten to a point where I can’t even take a bath? This is pathetic.” It’s what I was thinking. I said, “It’s time. I’m going to ask my mom for help.” I remember I got out of the bathtub. I wrapped myself in a towel. That bathroom was in the main hallway and she was in the computer room to the right. She keeps her door open, so if I stepped outside, she would’ve seen me.

I take a step out of the doorway. I stood there for ten minutes. Finally, she was walking by, did a double-take and then she kept going but then backed up. She looked at me and I lost it. I started crying. A mom knows. She came, hugged me and pulled me out to the couch in the living room. I laid in her lap and she said, “It’s going to be okay. I’ll help you. We’ll find out what we need to do.” That was the moment where she understood I needed help now. I’m finally at the point where I’m ready to do something. I looked on my insurance and found a psychologist that specialized in eating disorders. We found a nutritionist and that didn’t work out.

She’s trying to explain, “You need to be okay with eating more fat.” She made an agreement with me that six almonds a day. Even with what I have going on in my head, I know that this is not right. I ended up working with a psychologist. This was 2007. I was 23. Every night, I’d be at work. After dinner, I would go on my computer, write my mom an email and give her my food journal for the day. I was honest with her. Obviously, I could have lied, but I was sick of the way things were that I was honest with her and we worked from there. It was a lot of learning.

It wasn’t easy by any means. Everybody knows it’s not something that you can just go talk to a therapist for a couple of sessions and then you’re cured. It was very gradual. I know in the beginning, I focused on fat-free and low-calorie foods. You could say a lot of it was plant-based. Maybe chicken I’d be okay with, but I didn’t eat a lot of it. I was just trying to gradually add in things that I was comfortable eating and trying to gain weight because, at that point, I lost my cycle. In my head, I was like, “I’m never going to have kids.” I know I need to get back to a point where I’m at a healthy weight if I want that because I do want to have kids.

That was a motivator. I had skin, especially in my mid-section, that I was never going to have a flat stomach. Part of it is I kept losing weight, thinking maybe eventually I would have a flat stomach. It was the skin, so it wasn’t going to happen. I did make an appointment to have a tummy tuck. Unfortunately, it didn’t work. They normally do from hip to hip, but mine was under my breasts from armpit to armpit to pull the skin up. It was a horrible recovery. Essentially, it was a waste of a lot of money.

That was this thing that was going to help me in my recovery and that was devastating. I eventually got past it. It was what it was going to be. I wasn’t going to do anything else until after I had kids and then I met my husband. I joined a motorcycle group because my father had always been into motorcycles, and my brother too. We did BMX. Anything two wheels, our family was into.

Gas prices back then, it was when they were sky high and I worked 45 minutes away to get a motorcycle and then I was taking the class. They told me about this group that we had a forum and I’m like, “I’ll join it.” They had bike nights. I was like, “This is a good girl-to-guy ratio.” Here I am, this young, attractive female, showing up at bike nights and my husband was there. He had a good college degree and a good job. I said, “That’s the one.” We met there.

He knew I had eating issues because when we would go on group rides and they would stop at a convenience store, people go and get snacks because they’d be long rides. I’d be the one to go in there. I got a jar of salsa and that’s what I would eat because it was vegetables. It was only in vegetables I could find. I don’t think he understood the extent of it because I never showed him the pictures of when I was sick and when I was big.

He didn’t really understand it, but eventually, he knew because I was still having issues with bulimia sporadically. I would get worked up about it. It was hard. Over time, I did a lot of reading, took a few nutrition courses, trying to learn. Everybody thinks you’re skinny, you’re healthy, but I wasn’t because I was on an antidepressant. I had digestive issues. I was fatigued all the time and afternoon naps sounded great constantly, brain fog, things like that. How could I be healthy just because I’m skinny?

Finally, I’m working out in my head, “I need to eat better.” It was realizing that maybe the fat-free, sugar-free, low-calorie stuff isn’t what I should be focusing on. Maybe I do need to eat things that have some fat. I need to find something with protein and things like that. It’s been over the last couple of years getting to a point where, “Now I feel like I know what’s going to fuel my body,” versus, “I want what’s the lowest calorie thing I can find.” The best thing for me is finally having it click in my head that it’s the ingredients that matter instead of what’s on the nutrition facts label.

That had to be frightening as you’re starting to put weight back on. On the one hand, you know that’s for the best, but it had to be such a culture shift. I would think that it would be like a loss of control. You’re just like, “Can I stop it as it goes the other direction?” I’m projecting.

It’s always in the back of my head, but it’s not been until where now I’m at the point where, “It’s okay to go up a size in pants be if it’s going to look better. I don’t need to squeeze into the size I want to be because you’re going to look better if your clothes fit.” That’s only been recently that I’ve been okay with that. A big part of that was with Peloton before I was going to the gym to lose weight. Constantly, I was working out to burn calories. It was, “What did I eat yesterday? Let’s go to the gym and burn that off.”

Now it’s, “I’m going to go do a run because it’s fun. I’m going to go lift weights because I want to have more strength and I want to see bigger muscles.” Especially, I have a daughter. We had fertility issues. We did IVF with ICSI, did two rounds and we were lucky enough to get pregnant with her on the second round. I found out as soon as possible what we were having.

When she told us it was a girl, I cried. I spent the whole weekend upset because I didn’t want her to end up like me. I was scared of passing on my food issues to her that I had hoped so much for a boy. I have a tattoo on my bicep that says, “Because she’s watching.” It’s a reminder that I use the F word in front of her, but not fat. That’s my thing.

I refuse to use that word in front of her. I don’t ever talk about not liking something about me, my body, as much as I don’t want her to eat like I do. I know I’m pretty strict because I want to be. It’s not because I don’t want to gain weight. It’s because I want to put the stuff in my body that is going to help it. I’ve learned that I’m going to let her be a kid. When we go to the birthday parties, as much as in my head, I’m like, “Don’t eat that birthday cake,” I let her have the birthday cake. She goes to school. Our thing is when she’s good all week, she can buy lunch on Fridays. It is what it is.

I don’t want to get any food fear in her and create any relationship with food for her that is not a healthy relationship. We talked about it just like we talked about exercise. I remember she came home from kindergarten one day and jumped rope up in the living room. She said, “We exercise, so we don’t get fat.” I froze. I was like, “This is exactly what I was scared of.” I can’t control what other kids say, so we had a conversation. It’s been a constant conversation now that, “No. We exercise because it makes us feel good. It’s good for our muscles. It’s good for our mental health. It makes us happy and it’s fun.”

She knows it cause she sees how much I enjoy doing the rides, runs and talking about that. I try not to be super strict with her, but we do talk about it. My whole thing with her is, “You can eat anything you want. You want to find the better version of it.” We have our favorite ice cream. It’s is a brand called Frönen. It’s some of the flavors 4 to 6 ingredients. It’s stuff like banana, water, coconut cream, honey, and then flavoring. She loves it.

I said, “This is all I want you to know is you can have it. Nowadays, it’s so easy to find a better version.” In the pantry, we got Hu Kitchen chocolate. I had those chocolate bars that I put squares of it in her lunch. I said, “You can have all this food, but let me just try to find the one that has better ingredients because it’s going to make you feel better and it’s better for you.”

I appreciate that you’re so aware of that and that you’re trying so hard to make sure that she has a healthy relationship with food. As a fellow mom, thank you for that because a lot of people experience trauma and they don’t have any kind. They go through whatever they go through and they don’t stop to think about how it’s affecting their kids. It means a lot to me that you’re able to do that. Congratulations. That’s amazing.

I’m lucky my husband is totally on-board with it. He understands and supports it. Without him, I would be in a worse position. We went to the studios in New York to do my 400th ride. It was February 2020. I’d been wanting to go and it was a bladed birthday gift. We went up there and crap hit the fan. You’re stuck at home. You have all this time to exercise. I was running a lot and I’d found Selena’s squad. I cannot say enough about that group.

We started doing the group runs like, “There are no live classes. Let’s do our own. Let’s get together. Who wants to run tomorrow at 11:00?” In a time where normally I would have slipped back into, “Now I’m exercising.” I weigh myself twice a year as someone that used to weigh 4 to 5 times a day. I have learned not to focus on that, especially with building strength. I know I’m going to gain weight.

There’s time that normally I would be obsessing over it because now I have the time to sit at home and work out as much as I want. It was because my mindset had shifted from, “Let’s work out to burn calories,” to, “Let’s work out to have fun. I’m going to go run with my friends today who want to do a ride.” It could have been a whole different story, but I came out and I don’t think we’re still out of that, but I’m still in a position where I still have a good mindset it’s because didn’t just this whole community people, you don’t see a lot about that.

“Let’s go do a ride. I need to burn some calories today.” You still have people that talk about it, but it really is, “Let’s do it because it’s fun, because this ride sounds like fun. This new Artist Series, I love them. Let’s do that run together.” It’s been beneficial because now I have the healthiest relationship with exercise that I’ve had my entire life.

That’s great because I was wondering how you strike that balance because it was a component of what you were struggling with, but obviously, exercise typically is a good thing. That’s got to be a delicate tightrope to walk.

It was an obsessive thing to do, but having something that made it fun.

You change the motivation behind it. It would still be goal-oriented, but the goal is fun now instead of other things.

Because I was no longer so focused on calories and all that, it was a good time to get the bike, the tread and all that because who knows? A few years ago, maybe I would have gotten it and it would have been, but it came along when it was going to be great for me. I volunteer a lot at my daughter’s school. I was there all day. I wanted to get on a ride or something, so I did a holiday ride as soon as we came home from school because all these rides are so much fun. I want to do one and now it’s not, “I didn’t do my workout today.” Normally I would feel that way.

It’s like, “No. If I don’t work out, I feel like crap. I feel like a slug.” Now I said, “I want to do it because there are so many fun ones and I enjoy them. I’m going to feel good and all that stuff.” We have the tonal. That was Mother’s Day 2020. Being able to focus, now, my mind is, “I want to be skinny. I want to be strong. I want to be healthy.” It’s hard to look back, know and see what I put myself through because there are always going to be lasting effects. I have arthritis issues and I know a lot of that stemmed from so many years putting my body through that.

Now, I feel like I’m in great shape. My husband, “What do you want for Mother’s Day?” “I want fitness equipment.” I can’t say enough about the people that I found in Selena’s Squad. I’d been in the other groups before. I never really participated much, but finding these people, you click with your people.

Everybody talks about, “Find your group.”

These were my people. These are the ones that we get together on Sundays for our Sunday Brunch Runs. My husband knows. He’s like, “It’s Sunday afternoons. She’s busy.” I had to do something one Sunday. It was an annual tradition with my mother and my daughter. I can’t get out of that. I’m missing Sunday Brunch, and I was devastated.

You keep talking about Selena’s Squad. Is Selena your favorite instructor, or is that a tough question?

For the chud, she’s my go-to. She’s very genuine. I love her, but it’s like picking your favorite kid. It depends on your mood. Also, the Artist Series is so great that I can run to anything because it doesn’t matter, even if it’s not the music that I love. They make it a lot of fun. I’m loving Kirsten. She’s very real and relatable. I have a lot of fun with her, but in Selena, there’s something special with her in the squad that I’ll always have her meet my top.

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Do you have any advice for people who are just entering the world of Peloton and you have both worlds of Peloton at your disposal?

I know a lot of people start with the bike, but I’ve had a lot of friends that they called the numbers and said, “I can’t hit those numbers.” You don’t need to. When you’re starting out, in my opinion, you go for cadence and the resistance, you do what you can do to hit that cadence. Eventually, the resistance will start getting up and you’ll hit the numbers. I have days where I don’t because maybe it was leg day and I’m just on a bike trying to do a great ride.

Especially when you’re starting out, you don’t need to hit the numbers. You do what you can do and just do it for fun. I know people have mentioned it before that the instructors you liked in the beginning, maybe you like different ones now because, in the beginning, Cody wasn’t my cup of tea, but now I love him. Robin, in the beginning, we weren’t meshing, but now I love her. Sometimes you got to try something different, try a different instructor, and don’t focus so much on the numbers. Focus on the fact that you’re there, and you’re getting out of it where you need to get out of it.

What is your leaderboard name?

It is FSUSeminoleGirl. I am diehard Florida State.

You were only there for three because apparently, you are a great student.

I’m still bitter about that. I questioned why did I do all those advanced placements in high school when I got gypped out of a year in college.

You don’t have all those student loans.

I didn’t turn 21 until the middle of my last year there. My parents were probably glad about that.

Thank you so much for taking time out of your day to join us in sharing your story. I know it’s a tough one to share, but I’m sure that there are people out there reading that it means the world too.

It means the world to us that you would be able to share. Thank you for that.

Thank you. I appreciate it.

Before we let you go, where can people find you if you would like to be found?

I will be with the squad on Sunday Brunch, FSUSeminoleGirl. On Instagram, I am @LattesAndPlaydates.

That’s wonderful. Thank you.

—

I guess that brings this epic episode to a close. Who is the next episode?

Jeffrey Hutt will be joining us. That is a wonderful conversation. I can’t wait to share it with you guys.

Until next time, where can people find you?

People can find me on Facebook at Facebook.com/crystaldokeefe. They can find me on Instagram, Twitter, the Bike, and the Tread @ClipOutCrystal.

You can find me on Twitter @RogerQBert or Facebook at Facebook.com/tomokeefe. You can find the show online at Facebook.com/TheClipOut. While you’re there, like the page and join the group. Don’t forget our YouTube channel at YouTube.com/TheClipOut. That’s it for this one. Thanks for tuning in. Until next time, keep pedaling and running.

Important Links:

• Megan Pace – Instagram
• Apple Podcasts – The Clip Out
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• Google Podcasts – The Clip Out
• Peloton
• Facebook.com/TheClipOut
• YouTube.com/TheClipOut
• @Wild_Bill32 – Twitter
• Facebook page – Run, Lift and Live
• Run, Lift and Live – Facebook group
• @RunLiftAndLive – Instagram
• @RunLiftAnd Live – TikTok
• RunLiftAndLive.com
• No More Diets
• Dr. Jenn Mann
• @DrJennMann – Instagram
• Hump Day With Dr. Jenn
• FightCamp
• CNBC – article
• Mashable – article
• MetPro.co/tco
• Tonal
• Today – article
• MetPro.co/tco
• Facebook.com/crystaldokeefe
• Instagram – Clip Out Crystal
• Twitter – Clip Out Crystal
• @RogerQBert – Twitter
• Facebook.com/tomokeefe

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