Leap Academy with Ilana Golan - Peloton Co-Founder Tom Cortese: Building an $8.1B Brand & Knowing When to Walk Away | EP171

Episode Date: September 8, 2026

Tom Cortese helped turn an idea that investors rejected hundreds of times into Peloton—an $8.1 billion public company that completely changed the way millions of people exercise. But his story isn��t just about building Peloton. It’s also about knowing when to walk away from something that has become part of your identity and having the courage to start again.In this episode, Tom joins Ilana to share the real story behind Peloton—from starting the company with just $400,000 and getting rejected by investors to selling the first bikes, building an incredibly loyal community, and eventually taking the company public. Tom also opens up about the difficult decision to leave Peloton, why he realized he was the one who needed to go, and what it took to separate himself from a company that had been intertwined with nearly every part of his life. Now, he’s starting over—this time partnering with Chipotle founder Steve Ells to rethink fast food with Counter Service. Tom shares why leaving Peloton made this next chapter possible and what building something from scratch all over again has taught him about success, failure, identity, and reinvention. Chapters 00:00 From 400+ No’s to an $8.1 Billion Company 01:45 What Philosophy Taught Tom About Building Community 05:50 Why Your Career Doesn't Need to Follow a Straight Line 09:40 The Hidden Market: How Relationships Create Opportunities 12:00 The Opportunity That Turned Tom Into a Product Manager 15:05 Proust: Building a Great Product That Wasn’t a Great Business 18:49 How Tom Handled His First Startup Failure 21:58 The Night John Foley Pitched Him Peloton 25:53 Turning Boutique Fitness Into a Subscription Business 27:21 Starting Peloton With an Idea That Seemed Impossible 29:51 What Exactly Is Peloton? 31:19 Building Hardware, Software, Content & Community at Once 33:39 Start With the Customer Experience 36:20 When SoulCycle Banned the Peloton Founders 37:16 How Peloton Started With Just $400,000 39:40 Raising $5 Million After Investors Said No 43:33 How Tom Kept Going Through Rejection 45:41 Turning the Vision Into Something Investors Could Believe In 47:41 Building Peloton’s First Bike in Taiwan 50:50 Selling the First Bikes Through Kickstarter 52:45 How Peloton’s Community Took on a Life of Its Own 53:15 From 5,000 Bikes to an $8.1 Billion IPO 54:43 The Community That Changed Peloton 58:24 The Hardest Decision: Knowing It Was Time to Leave 1:02:20 “The Odd Man Out Was Me” 1:05:47 Separating His Identity From Peloton 1:08:35 Starting Over With Chipotle Founder Steve Ells 1:11:13 Why Tom Jumped Into the Fast Food Industry 1:13:21 The Problem Counter Service Is Trying to Solve 1:20:08 Why Leaving Peloton Made This Next Chapter Possible 1:23:51 What to Expect From Counter Service 1:27:29 Success, Failure & How Other People Tell Your Story 1:31:20 Dealing With the “Rise and Fall of Peloton” Narrative 1:33:28 What Tom Would Tell His Younger Self 1:35:02 What’s Next for Counter ServiceAbout Tom Cortese ABOUT TOM Tom Cortese is the co-founder of Peloton and CEO of Counter Service. Tom helped build Peloton from its earliest days, developing the product and experience that combined hardware, software, content, and community into a new category of connected fitness. The company grew from an initial $400,000 investment to a public company valued at more than $8 billion at its IPO. After stepping away from Peloton, Tom began exploring what his next chapter could look like. That journey ultimately connected him with Chipotle founder Steve Ells, and today the two are building Counter Service, a technology-driven restaurant concept focused on bringing better food, smarter operations, and a new approach to fast service. LEAP ACADEMY Ready to make the LEAP in your career? There is a NEW WAY for professionals to fast-track their careers and leap to bigger opportunities.Check out Ilana’s free Leap Academy training: leapacademy.com/training 📲 Connect with Ilana: Facebook ▶️ https://www.facebook.com/IlanaGolanLeapAcademy LinkedIn ▶️ https://www.linkedin.com/in/ilanagolan/ Instagram ▶️ https://www.instagram.com/ilanagolanleap Website ▶️ https://www.leapacademy.com/

I've told this story in personal circles before. Never threw a microphone. Not an easy moment. Tom Cortez, the co-founder of Peloton. I'm not sure if I was successful yet. What does it mean that I would have stayed at Peloton longer, but I couldn't? Does it mean that I failed? Most of the folks that we spoke to thought that this was a terrible idea.

We got honest feedback from even friends and family, like, really, this is what you're doing with your career? What the hell's wrong with you? That's the worst. you take on one hand all the personal stuff and then all the nose what drives you to continue? The count of nose almost didn't matter because when you talk to all folks on earth and you're trying to raise five million dollars eventually you get there. Walk me through at that point when you leave or when you say you leave you don't have a plan B where is it taking you? And I actually just

started going through all of the people on the senior leadership team and one by one I went through every single one and I gave them a reason why that person was terrible. If I just said that every single person around me isn't right for the job, who's the odd man out? It's me. I was like, I think I know exactly what I need to do to fix this problem. I got to go. If I did not go, I could not be here today. And here today is a remarkable, awesome place to be. There are peaks and valleys in life if I'm going to be here on earth. I want. Hey, I have a favor to ask. I decided not to put any ads on the show because I don't want to vouch for things or products

that I don't really, really believe in. But in order for us to continue to bring these amazing guests, all I'm asking is, if that's okay, just click that like, subscribe, download button. Those mean to us more than you can think. So is that a good deal? Let's dive in. Imagine pitching a business idea to investors in hearing the word no over 400 times. Most people will just walk away.

But my guest today built it anyway. I want you to meet Tom Cortez, the co-founder of Peloton, which I'm sure you all know. And he turned these hundreds of noes into an 8.1 billion unicorn that completely redefined the way we get it fit. And in late 2023, he actually made an incredible difficult decision to step down from the empire he built. We'll talk about this hard decision and how he reinvented himself. And he partnered with the founder of Chipotle to disrupt the 48 billion fast food industry. And he's now the CEO of counter service.

Welcome to the Leap Academy show, Tom. Elana, thank you so much for having me. And I appreciate that introduction. Hopefully I can make some good out. out of it. Oh, it's going to be amazing. And I'm just going to say one more thing to the listeners. Remember that every week we select a question from our YouTube channel. So go to the Leap Academy with Ilan-Golan YouTube and put in your questions so we can answer it here live. And today I selected already a question from Nira because she asked, how do you cope with the dark moment?

So stay until the end because we're definitely going to talk about it. And Tom, so I'm here, you know, like, you know, I was trying to geek over, like, what made somebody, like, Tom, do so much disruptin and build such incredible companies. Like, is there something in your childhood that created this drive for entrepreneurship? And, like, were there early signs that you're going to be crazy? Like, what is that? I honestly, I don't know. Maybe a lot of it is just, I don't think I really like working for anyone, which just didn't give me a lot of options in a world where you have to work. So I had to go figure out how to work more for myself than anyone else. That's a good reason.

But you tell me, like, you know, when you kind of put the pieces together, your childhood and then you actually studied philosophy, which most people would not tie it all together to somebody that will then build these, like, you know, such a unicorn. Don't worry. I got a minor in the fine arts, so that made it clearer what my trajectory was going to be. So what did you get out of philosophy? I'm sure there's actually a better, like a lot more match than we even think of.

In hindsight, I think there ended up being quite a match. Well, I guess that's obvious, right? Because I am who I am because of what happened to me, especially when I think about Peloton and building community. You know, the study of philosophy, at least the angle through which I went through the studies, was really looking at how we as humans have argued, over time about how to come together in community and the different methods by which we could think about

how to come together in community. And when you think about then building Peloton or honestly building a lot of the technology forward applications that we have nowadays, we're thinking about how to engage people. We call them users in technology, right? How do we engage those users in the new restaurant world? We talked about engaging our customers or our diners. But we're just talking about bringing like-minded folks together in a particular way.

And I think I got a lot from my studies of philosophy that apply really nicely in that world. Is there one thing in particular? We'll talk about how you eventually created, you know, Peloton into more of a community product. So we'll talk about it later. But do you think there's something that jumps at you to say, you know what, this is like a really big lesson from the philosophy days. It's more what I, what I was pointing out, that broad stroke of, you know, it's interesting to think about this idea that over time as humans, we have tried in multiple different ways to optimize the way in which we come together so that we can

optimize for either personal happiness or communal happiness or productivity, right? Different different methods by which we decide what we're trying to optimize for, and it's caused us to come together in all these different ways, form different types of communities, from different types of governments, structures, et cetera. And so just recognizing that we're kind of, we're interestingly malleable that way as humans and can come together in all these different ways, allows you to think about these different consumer applications and how to bring folks together around a new idea in a different way. It lets you understand that there are many approaches. There isn't just one approach. There are many different approaches that might work

to get different people to rally around this one idea and bring out the best in those folks. Oh, I love this. I might tie it back later of how you see the future. But after that, you just went into different roles. You said that this is, you know, and then you decided to co-found pros. So take me a little bit to like the beginning of the career. What made you co-found, Prost, and then, like, it didn't quite work out. So tell me, like, the story a little bit. I guess I'll give you the whole story so that folks understand that it's not a straight line. It doesn't necessarily make sense. I wasn't necessarily born to be what I've become or destined to be who I am. It has happened over time and it has happened iteratively. And I couldn't

have told you 20 years ago that I would be here today having done what I've done. And I think, I think maybe because I couldn't have told you and because I wasn't so certain, it allowed me to pick and move through life to find the right space. I graduated college largely not knowing what I was going to do, but still feeling certain. I wasn't languishing in any way. I was actually trying to decide if I wanted to get an MBA or an MFA or just go to work. Those aren't normal side-by-side choices, but I was willing to entertain across the board. And then it turns out that the place that I was interning at offered me a full-time job, and I said, you know what, I'll do that.

I was at a large nonprofit called Ashoka. They operate across 50-plus countries around the world, and they have this idea of a social entrepreneur. So how could we invest in individuals who could. could in a not-for-profit way change their community in the same way that you would invest in an entrepreneur to go change a market. And I thought that was a really clever and interesting angle, and I was interested to learn from those folks. And I spent a few years there learning from these people, learning from that whole notion. I also learned that I didn't want to stay in the nonprofit world. But it was a great, it was a great anchor. It kept me out of

business school, thank God, kept me away from going for an MFA. And it became my trajectory. And honestly, it was the people that I met along the way, the relationships that I built inside those walls and around, I was in Washington, D.C. at the time, around the Washington, D.C. area, those relationships led me from one place to the next. I met an interesting entrepreneur who was starting his own business and through conversation and because we enjoyed one another, I joined him. I helped him build his business serving some of these not-for-profit organizations and small businesses. From there, met new people. And before you continue, before you continue, like I think for the listeners, we talk a lot about the hidden market. And the hidden market,

it's not just a hidden job market. There's like endless opportunities in a market that you might not even, that would never be posted anywhere because it is based on relationship. It is based on how you open those doors. So I just want to make sure that listeners are getting it. Like there's, all these things are where all the coolest opportunities are. So go ahead, continue, Tom. Yeah. And I don't need to give you a long boring story. But that is, that is where I was trying to go, which is, you know, it was, it was more about, I was always willing to, um, to try something. And I was always willing when I tried something to put my full self into it and fully try it on. And in doing so, that gave me an opportunity to understand what I did and didn't like,

and it gave other folks the ability to see whether or not I actually could perform. And I think that was helpful. And again, that then creates relationships. When you give your full self to something and you're doing that with a bunch of colleagues, those colleagues respect that and take something away from that. and that leaves an impression, which might come back months or years later in a unique or helpful way. And this is simply how my career progressed from sort of one interesting thing to the next. And I think there's also a little bit of a, in the beginning of a career, you know, things just kind of move,

but at some point you need to start making more intentional decisions. But before that, when you co-found Prost, and I'm probably saying it wrong, but like, again, I know it was kind of an extension of a previous job, et cetera, et cetera, but it was a beautiful idea, but it didn't quite work out. Can you, like, tell us a little bit about, you know, take us into the room when you realize that maybe it's not working out? What was it supposed to be? And where is it taking you, Tom? To answer that question, I'll back up for a second. So one day I was in Washington, D.C., and I was on a rooftop at a party, and I was talking to a very tall gentleman named Sandeep. And as I'm having this conversation with him, at some point he looked at me and he said, hey, you know what you are?

You're a product manager. And I said, what's that? And I said, what's that. Yeah, yeah. That sounds good. He said, you know what? I work for Steve Case, who founded AOL. and we're building this new company called Revolution Health.

We're looking for product managers. You fit the bill. You should come in. And I did. And I took that job. And I met a lot of remarkable people. And suddenly I'm a product manager in technology, which is more or less what I still am today.

But if I can take you there just for a second, and this is again for our listeners, like it's not necessarily about the credentials or what you study. or all of the things. In fact, it's probably, if I can tie the knots like backwards, right? It's probably that zone of genius between philosophy and understanding relationship and people and communities together with your love for art, which actually makes you a brilliant product manager. And it, you know, it eventually was about the relationship that got you there, which is kind of interesting to think about it because I think there's a lot of chase around certificates and can I get the diploma. But it's

really about like how can I tie these things and with a relationship open the door. If I'm reading it, that's right. I think so. And again, that's just my story. And everybody's story is different and everybody makes it through life in a different way and achieves, you know, what they achieve in different ways. And for some people, it's because they were so focused on making sure they got into the right school and got the right degree and they knew what that was and they chased it.

And for some people, that unlocks things for them. It wasn't for me. And I think that's also important to note. There are different versions of how life works out well. And we're still not sure if mine's going to work out well. But becoming a product manager was an important step to then understanding why I actually wasn't terribly successful running Proust.com when we started that first venture. But importantly, because I was at Revolution Health, I eventually got introduced to John Foley. John Foley and I then went on a fun run together.

John and I started Proust together inside IAC. I worked for John at IAC. I learned a lot about leadership from John, a phrase that he uses that I've adopted is lead from the front. And he certainly would always lead from the front. And he meant that more culturally and in spirit than anything. We had a... We say that a lot in the military, too, the lead from the front. So that comes from there, too.

I think that's the origin, right? The front line. Those frontline generals are different than the ones hanging in the back. Do you really want to work for that guy? So we were together at IAC and then a series of things happened, right? He pulled me aside one day and he pitched me on this idea of Proust.com. He loved the questionnaire in the back of Vanity Fair. that they called the Proust questionnaire after Marcel Proust,

and there's a whole story there, you can go look it up. And he thought, oh, we can create an interesting subscription business around this. John was, as long as I've known, John, obsessed with creating a subscription business. And we create a subscription business, and it could be interesting, and we can have people ask questions to one another. I think you should run this, and we should go pitch IAC that they should fund it, and let's go build it. And so we did, and I ran that for two years.

We got some cool design awards, and we had a nice little community, and we were able to engage people in this different type of sharing at the time. Facebook was the dominant method by which you share, and everything was suddenly becoming public. And this was a different way in which we said, what if we could share more privately? What if you could share interesting questions with your parents and your siblings so that you can build your story together while we're all still here,

versus waiting for everybody to die and then go looking it up on Ancestry.com. That wasn't the official pitch, by the way. And so we did that. And what we did is we built, and maybe because I ran it, we built, I think, a really great product. And that great product had a great little community.

What I forgot to do was build a business. And I forgot, I just didn't know. And I know that's stupid to say because I was running a business. but with my team, we built a product, and we built a great product, and that great product had a great community following, and again, we won some awards and all that,

but it didn't turn into a business. And that's why it didn't work, right? There was no way to make money off of this thing. It became time to move on after two years. Was there a moment, Tom, that you knew that this is not going well, and how did you take it personally? The data is so clearly there when you're running in,

an internet business or an application business. You see how many users. You see what engagement is. And so you can see what the positives are. Positives. The people who are here come often. The negatives. There aren't a lot of them.

It's pretty clear. So they're cool. Do not have a, you know, this is not a scale business. If there was a lot of those folks, then there's an advertising business. If there are enough of those folks and enough of a premium opportunity, there's a way to charge. There wasn't enough of that willingness to pay among the group that we have. So we created a great free product for a small number of people. That is not a business.

And so, you know, coming to that realization was important. Like I don't think I could have done what came next without having learned that unless maybe I would have gone to business school and they would have told me. that when you're making a business is your view a business. And maybe that would have done it, but that would have been a costly way to get through it. To find out.

But, okay, so, but again, some people will take so-called failure or lesson like this and just say, you know what, forget it. I will just go be an employee, you know, like a regular employee because I'm not meant to build businesses.

You took it to a completely different side and actually built a unicorn, but we'll talk about that. What made you think just be able to climb out, I assume a hard moment and just continue? For whatever reason, I didn't take it all that hard. Part of that, I think, is just a personality trait that is sometimes negative and sometimes positive.

I think I'm oddly slow to react and slow to recognize what emotion is actually taking place until later. And so that's actually been helpful in certain ways. And then I also have a really terrible memory, you know, like, so it's easier to move on fast. And those negative traits have been very useful. My wife will tell you all the reasons why they're not so helpful. But that's a different episode. And we can cover that another day.

So you decide to come out with an idea for Peloton. Take me there for a second. You know, it has to do with something you needed. So take us there. And why did you decide to go there? This is almost the same setup as with Proust, only this time we figured it out. And that was John Foley called me.

And he said, come over. And I was like, oh, cool. John wants to have him drink. How nice. He had just had a baby. I thought maybe something to do with that. So I go to John's house. And I remember his wife Jill is on the couch nursing their newborn.

I brought them some socks. And I'm thinking, like, what's happening? I thought I was coming over to hang out. And John just sits me on the couch, puts this drink in my hand, puts the sushi in front of me, and then opens up his laptop. I was like, oh boy. And it said across the screen, it was a PowerPoint presentation. It said, Peloton.

And I was like, okay. And then he says, Peloton. Okay. And I was a triathlete. My girlfriend at the time was now my wife forced me to do an Iron Man and all sorts of complicated things. I hated it. Okay. Yeah, no, I just did it because she told me that those were the rules in order to finally win her over.

And so I did all the races. Got as fast as I could. And John knew that I was, that I was, I was, I was, I was, I was, I was in fitness and at cycling. He had found a love for the studio cycling, the flywheels and the soul cycles. And we had learned to work really well together and create things. And so he says, Peloton. And then he says, look, you know, we talked about, we talked about cycling and we talked about fitness. We talked about the big, big box gyms being less, less exciting for consumers nowadays.

than they used to be because now it's way more fun to go to your favorite yoga class with your favorite yoga guru in an environment that you enjoy with a small class around you or your favorite cycling class. And that these boutique classes, as we called them, were becoming much more fun and interesting for people than other forms of exercise. And what he was pitching was in the dorkiest way, what if we could create a distributed system that makes, makes this more scalable.

Okay, so what do the hell does that mean? And that was, hey, basically, if I put it into regular talk, it was how do you take all the joy and magic that happens in that small group class, the exciting atmosphere, the remarkable guru at the head, the great music, how do you take all that? And how could you use technology to bring that into homes all around the world, into these private spaces. How do you bring the magic of a group class

into the privacy of home? And the answer was, well, that sounds impossible. Cool, let's do that. The answer wasn't there, right? The idea was there. The answer wasn't there. And once again, it was the pitch. Hey, I think this is interesting.

I actually think this is the better subscription business because this is now access to the most remarkable instructors from wherever you are. as opposed to having to, you know, go to only New York or L.A. at Tuesday at 7 a.m. to get, you know, that best instructor. Right? That puts a real cap on who gets access to those people. And it starts to drive prices up, right? At the time, it was $40 a class in New York to go to a SoulCycle or a flywheel or your favorite yoga class. I mean, that's ridiculous. And so we were like, cool, how about $40 a month for unlimited classes for everybody inside your house?

right? And we start to construct now a business around a remarkable product. So we got the second part right this time. Remarkable product with a remarkable business in an area where there's willingness to pick. And that's how you make the remarkable business. That was the origin story. A crisp and clear pitch from John who are respected tremendously and still do today. And thankfully, he had respect for me that he brought the pitch my way. And then And it was, can we turn this into something? And that conversation was probably November of 2011, maybe October, October, November of 2011. We incorporated Peloton January 3rd, 2012.

We opened the first office, which only had me in it. February 2012. John was working for Barnes & Noble. He had a family. He needed to keep getting paid. We quickly realized that was the only person who apparently didn't need to keep getting paid. so I got to be the one to guest in that office. Did you know at that point that it's going to be like this huge complicated thing?

It's not just a little idea. This is like hardware, software, huge, expensive. Like, did you understand the magnitude of what you just got into or not really? So yes and no. I could tell you for sure we did not know that we were going to create as big a business as we created. I definitely understood the complexity, and that's what was attractive about it to me, that on its face seemed like not possible,

so that sounded fun. But also you can understand why it could be possible, and the fact that there would be multiple parts to it. I enjoy context switching, and so being able to work across different, components and pull those together into a unique product and business sounded like the type of work that I like to do. So, yeah, the complexity, for sure. That said, I think because we didn't know too much, we were able to move forward.

And by the way, just I didn't think of that, but maybe if there's a listener that somehow lived under the rock, like, can you explain Peloton just for a second just in case? Like, I don't think so, but let's just make sure. Peloton. We are a New York-based fitness technology company. Started in 2012. We offer live and on-demand studio cycling, running, and rowing classes from the comfort and convenience of your home.

We design, make, and deliver to you, I think the highest quality pieces of fitness equipment that have ever been made, then we bring those pieces of equipment to life in your home with the best fitness instructors on Earth, live broadcast, or on demand to your right to your device in a way that you can also engage with the rest of the community and a leaderboard or other methods to be able to chase folks or just understand where, where, where, where, where you sit. I love it. Thank you for explaining in a way that I probably couldn't.

Okay, so you're starting this thing. And for people to understand, like, for example, you know, you need to build like a bicycle, right? Like there's a hardware component. There's a software component. There's a connected component. There's like, so walk us through the beginning. We needed to build a bike. We needed to build a computer.

We needed to build a live broadcast facility that broadcasts more. than most news stations. We needed to build the internet-connected layer that ties all those pieces together. We needed to cause fitness instructors to want to work for us, not to mention software engineers. How do you get started?

Take us to the beginning, beginning, because this is what usually holds everybody back. They see this idea, it scares the heck out of them, and they will not go forward. So take us to the beginning. First of all, divide and conquer was another phrase that John and I and the team threw around a lot and is an important piece of how I work, how he works, how we work.

We did that well. And what does that mean here? John was out doing what John does really well, and he was pitching this business to every human who came within 45 feet of him. and he did it with increasing enthusiasm in an infectious way. He was nonstop. I was alone in a room. We're different. And I was staring at what started as a blank piece of paper

and trying to figure out what is the user experience on a screen that brings all of that excitement that consumers are feeling in the real space into this new virtual space. What could that possibly be? And how could you, how could you, how could you flow the user through it from, you know, turning it on to picking the class, to being in the class, to what are you going to see, why are you going to see it? That interface didn't exist before we built it. Once we built it, obviously, then lots of other people copied it. But it started there. It started with what is that experience. But I love that you're describing, kind of like the top down, like it wasn't the bottom up, it wasn't like the component.

And then it started with the user experience. Like, well, how am I going to get that excitement and then walk backwards to what do I need to build in order to get that? Which is fascinating. Yeah. And I think, yeah, I mean, I think you always have to start there no matter what the product is. And so we did. We started there. And in those early, those became.

wireframes, which became designs, those designs, then took that rough early presentation that John had started with outlining the business, and we were able to then turn that into a much more fulsome pitch and view. We added on engineers, and we started to build certain components, and we very quickly started to realize all of the things we were going to need to built. I'd say day one, we weren't, we said, hey, I wonder if I could build the software, and we look more like a cable company, said no one ever when they were aspiring to build a big business, where, you know, we can provide the software and maybe the soul cycles and the best yoga studios of the world would be channels and the best, you know, fitness equipment manufacturers

would want to put our software and our service on their equipment. Well, guess what happened right away? We brought the SoulCycle founding team into our tiny, tiny, tiny office, and we showed them every one of our designs. We showed them the pitch. We showed them the business model. In John's full excitement and my full nerdiness of showing them all the nits and that, of how we were going to make it happen.

The end result of that conversation was we got banned from going to SoulCycle. Wait, what? We just showed you everything because we were trying to see if this would be interesting. We got banned. Right? Wow.

Not just no, but just like, not only we were not interested, but you guys are threatening. I go. So threatening. I just showed you everything. And that happened time and again. The same thing happened when the fly, we showed the flywheel people. Then, you know, then that turned into an acrimonious relationship for some odd reason. How do you sponsor yourself until then? Like until, like at this point, how do you sponsor everything? You just kind of put in some money or was, are there already investors? Yeah, that's a really good question. and it's important for everyone out there because you're right this stuff doesn't cost nothing. So unlike my journey, John's was different. John went from high school to manufacturing to then figuring out his way into a great engineering college and figuring out his way to Harvard for an MBA.

I think what I witnessed and I think what he would tell you is that Harvard MBA, the dividend that it paid was the network. And the network of people that he knew because of that, when he was able to pitch this idea, that network produced the initial capital. And it wasn't a lot of capital, by the way, it was $400,000. Just to be clear, Peloton was started on $400,000. If you go look up what people are raising right now and compare. We started with $400,000. And I think the deal I made with John was like, cool, can I have like one of those hundreds to fund life over the next couple of years?

And we'll use the rest to go figure out the business. And that's what we did. And all those initial pieces that we're able to put together, that's what then allowed us to, with those $400, we were able to have a really small and shitty office, but we were able to build those initial designs. We were able to build some really early, a very rudimentary. I can't explain how rudimentary they are.

There's images and videos online somewhere. They're pretty funny. Sort of working prototypes, get people to come and mock teach classes for us. We were able to create video assets in photography and whatnot that actually built real presentations that was able to really start to off of the business was that those are the materials that then allowed us. And again, largely John, to go out and raise a $5 million round, which then really started Peloton. So let's talk about raising that bigger amount. And because at some point, you guys got a lot

of notes. I don't know if it's this one or the next one. But there's like a, I mean, there's a lot a fear, even until today, from hardware and software together. And 2012, I'm sure there's like massive fear. So how was it? How was the journey? Most of the folks that we spoke to thought that this was a terrible idea. And, you know, like, we got honest feedback from even friends and family, like, really? This is what you're doing with your career? Which, by the way, I still get now because now I got myself into the fast food restaurant industry. And people are like, really? What the hell's wrong with you?

That's the worst. Oh, we have to talk about, don't it? But so is fitness. Fitness was worse. And people would think, like, you're making exercise bikes. I remember being out to dinner with friends. And they were like, so we heard you're like making exercise bikes? It's like, wow, that's so unappealing.

They sell for like $200 on Amazon and nobody wants them, those? Like, no, right? So it's really hard to get over it. So there's that on the personal side. There was a lot of just like doubt. I was also trying to like, I was also trying to marry my now wife and had to explain this to my future father-in-law who I found out later started like aggressively trying to put away money for his poor daughter who was going to be destitute because she was

marrying the guy who was trying to make exercise bikes. So, you know, like, there's that side of it. And you just got to, like, grin and bear it and ignore it and be like, ah, whatever. And then there was the fundraising side of it. And that was also interesting because, you know, what we heard there were really interesting stories. So you would have these, you'd have these more established firms, which obviously are also just made up of individual people. And you would see that the individual person would start to get excited because this resonated for them. They can see themselves using the service. And then it would quickly devolve from there. You're like, wow, this is cool. This person's really excited. And then all of a sudden it devolved. And they're like, how is this

devolving? And they're like, well, so our fund, you know, has a strict rule. We don't invest in companies that are going to have a retail presence. And I think we heard you guys say that you're going to open up retail stores. You're not just going to be e-commerce. We're like, yeah, people have to sit on the thing. It's big. They're going to put it in their house. It's like a couch. You want to see it before you get it. That's just obvious. We're like, yeah, we just don't do that. That's against our like one of our principles. Like, oh, great. Okay. So it's a no? Yeah, it's a no. Okay. But I'll buy one. Awesome. Or like, you know, we don't, or we invest in software services but not hardware. Or we invest in hardware, but not ones that have software. But because we touched everything,

we were a live production studio. We were a hardware. We were a hardware. company. We were a software company. We were going to have retail stores. It was plainly obvious that we were going to have to figure out how to deliver, you know, 200 pound devices into people's homes, which in of itself is its own, you know, massive operation and undertaking. And we were all just like, yeah, we'll deal with it as it comes. And as investors, they're like, yeah, no. So Tom, how do you take, on one hand, all the personal stuff and then all the nose. And you don't just say, okay, this was a dumb idea.

Let's push it to the side and go get a real thing. Like what drives you to continue? Again, I think it's a personality defect. Well, first of all, like, I think it's important to, in work, right, if we're going to choose the work that we're going to do. It's important first to choose to work with folks that you, enjoy working with and who you respect and where you feel like you can push one another in a positive way. And I had that. I think it's important to work on things that add value to the world.

And if I'm going to use my, you know, whatever random talent or not talent I might have, like, why not help folks want to work out? That's a good thing, right? In the world, where the other options are go work at other big tech and help get people addicted to smartphones. What if I can use that same technology and help you get addicted to working out? That sounds good. So let's do that.

And then to work on, for me, to work on problems that are interesting in their complexity and their scope and this have that. So, yeah, I don't think there was a no out there that could have taken those things away. That's fascinating. Okay, so you get a ton of nose. Tell us a little bit how many,

and how did you eventually create the first or sell your first bikes? Thankfully, John was unstoppable in his desire to talk to everyone. So the count of nose almost didn't matter because when you talk to all folks on Earth and you're trying to raise $5 million, eventually you get there. Again, it was quite high. There was very low interest in, there's very low interest in investing here.

There were no institutional investors that came in in, you know, that seed round or in that first A round. You know, we really had a piece it together. And we did have to, you know, work really hard to show that we were, you know, dedicated and that we had a clear path to building the thing that we were building. and we had to show how fast we were capable of moving and willing to move. And those were the things that we were able to do. We were able to execute, and I think, again, because of that mutual respect, because of this idea of being able to divide and conquer and have clear and distinct roles that we were able to give one another space to go and attack,

and having a very clear vision on what that ultimate consumer experience was that we wanted to create. You know, we weren't, there was, there was no, there was no waffling on that. That was clear. What wasn't clear was what are the steps to get there. And so we were able to continuously show people that we, we had a vision and then we were continuously able to show people

that we were making progress. That got enough people excited that got us that, that first five million. And at some point you also ran a Kickstarter to sell some bikes, right? Like, is that rough, after that? Where is that in the... January 3rd, 2012, Incorporate February office. Alone.

Alone. Well, by 2013, now we've raised that capital or started raising the capital. And by summer of 2013, we've turned on our manufacturing partner in Taiwan. We actually found the family, family-owned business, the Wu family, still friends with the Wu family today. They were the folks who built the first ever spin bike on Earth in the late 80s. And then they built bikes for Schwinn for decades. And then when the financial crisis of 2008 hit, Schwinn and everybody else left Taiwan, went to mainland China. And then those guys were down and out for many years until we showed up.

with our crazy hope and dream. They were down and out. We have a crazy hope and dream. Thank God they took a bet on us. We took a bet on them, and they helped us build a bike. You literally flew to Taiwan to start this assembly line, if I'm understanding correctly.

Yeah, somewhere along that path, there were a lot of, there were a lot of trips to Taiwan. Later, it got more my first son, who is now 12, took his first steps at that factory in Taiwan. That's a whole chapter in and of itself. But they were able to actually help take our idea and start to materialize it into that physical product. We were able to start materializing the software subscription piece, the core business.

We were starting to bring on instructors in New York. Just a few. most people would not work for us, but a few who were willing to take the bet and who understood this difference of needing to come alive through the screen, which is a very different skill. And that all led to us having some of these early prototypes

ready by that summer, which allowed us to go test Kickstarter as sort of a pre-order platform, which is what Kickstarter had become by then. Kickstarter started off as a place where you could actually launch your business. by the time we got to Kickstarter, you know, that piece of Kickstarter was kind of dead.

It had largely just become like a pre-order platform. You had to have a product already made, which doesn't, like that word Kickstarter doesn't fit if you already have the product made. Yeah, we just actually had the ENC Strickler, the co-founder of Kickstarter, and he kind of talked about the path a little bit. So, okay, so you raise money on Kickstarter,

or you basically have the first whatever, 188 bikes sold on Kickstarter, if I'm remembering correctly, right? And then, okay, but at some point you also realize that, you know, the power of the community is what actually going to take it from just the fitness equipment to an actual business that will just, you know, grow the way we've seen it grow. What made that, like, shift for you? That is just part of it. something that happened organically. But that said, the goal here was to create a product.

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be able to book a completely free strategy call with my team. That's leapacademy.com slash training. That took the positive energy of a group class and brought it to many through a, you know, through this, distributed global system, right? And so the idea was to take that, the magic of a small community and make it big. Right. So that is at the heart of like what, what, what we're trying to do, what happened that we didn't see coming. Well, lots of things happened that we didn't see coming, like going public.

But one of the things that happened that we didn't see coming was that virtual community becoming a community in the real world. And so, you know, we get through Kickstarter. We open up our first brick-and-mortar store as a pop-up in Short Hills, New Jersey, in a mall, where we got to hang out a lot. We start selling those for a few bikes. We put the first bikes in the first home in January of 2014.

So January 2012, we start the business. January 2014, we put the first bikes in home. In that first year, we sold 5,000 bikes. So first 12 months, 5,000 bikes. We thought we were Masters of the Universe. The next year, we sold 10 or 12,000 bikes. and then 30,000 bikes, right, and then 70,000 bikes. And, you know, it was going.

And we doubled or tripled every single year from that first year until we took the company public in September of 2019. And because we were doubling and tripling the sales, while maintaining virtually zero churn in our subscription business, that's what drove all of that market value into the business and allowed us to take the company public in September of 2019. So honestly, the most explosive insane growth happened before COVID. Yeah, it was a whole thing. Yeah. And I actually thanked you before the show because right when you went IPO, I could buy the stocks and I was like score. And then, you know, you saw this hypergrowth with COVID.

And I was like, thank you. I appreciate you guys, Peloton. But so take me there. Like, how do you even cope with hypergrowth? Like, that's a different story. Well, so first of all, so along that journey of all these folks now, you know, becoming part of this virtual community and, and subscription service, they started to seek one another out because they were like, hey, your leaderboard name, you know, 8653, or nobody had numbers.

That was a dumb one. But, and they were like, hey, I always see you. always see you near me in Jen Sherman classes. You always take Jen Sherman classes. We're always in the top 20% together or we're always in the bottom 20% together, which by the way, became a place where you would relate. And that's fine. That's where you find community. And then they went on to Facebook and they started to try and find each other. And then they started to try and organize themselves into these groups. and one year, I think it was 2016,

we literally got a knock on the door at our corporate office, and it was like 15 teleton members from around the country who flew to New York, who met each, found each other on Facebook, decided that they were going to fly to New York, and they said,

they said, we're part of the home rider invasion. We're like, what the hell is that? And they were like, yeah, we're the home rider invasion group. We all got together, and we decided we're the home rider, we want to come and invade the studio. So they saw themselves as the homewriters,

and then inside our live broadcast studio, there were people who basically paid to be extras and sit in our studio. And they said those people as the studio writers, and the home riders wanted to invade. So not only did they come take class in the studio, but then they just knocked on our corporate office door, and they're like, hi, we just want to say hi.

We gave them stuff. And that started an annual trend where we then sponsored that home writer, We eventually called it Homecoming. And we would bring those folks, you know, we'd sell tickets and have people come to New York every year, meet their favorite instructor. I always enjoyed, like, walking around and nobody knew who the hell we were. And there's like, where's Cody? That way.

And so that's, you know, I think when you think about the value and the multiplying effect of the community, you know, that's, you know, that's where it came. out. And then when you also think about your other question of, like, how do you cope with all of this, cope with all this growth? I mean, just how cool was it every day to get these unique stories? I mean, we would have, we would have, we would have stories of like, you know, people meeting each other and getting married because of, because of Peloton. We also had stories of people meeting each other and getting divorced because of Peloton and then getting with the new person. And that's a very interesting stories. We had constant stories of, you know,

I went through this hard time in life. And, you know, because of the dopamine of fitness and my Peloton, I felt better and I felt more me. Or because of the way that instructor speaks to me, I found myself. Or because of the community that I've now met through Peloton, I feel like a better person. So, you know, when that's happening all the time,

you know, that is a ton of dopamine. mean for us to really want to keep, to really want to keep going and to really want to keep pushing through. For sure. And then, so you have this like crazy growth. The IPO is for $8.1 billion for anybody that missed it in the beginning. Am I, I, I'm correct, right? And, but, but in 2023, you actually make what I think is a hard decision, but maybe not. And you decide to step down. Was there a moment where you started thinking, you know what, this is, you know, this is not for me. Like, I need something else or I need to, like, where, how was that moment? Because I think a lot of our listeners are either contemplating what's next or trying to figure out when is the right time to leap or trying to think, like, is there something that I should be doing instead of just continuing with the rhythm, even if it was a good ride.

So how do you explain it, Tom? I've told this story in personal circles before. I never threw a microphone. Yeah, not an easy moment at all. But it was clear as day. And I certainly remember the day. Through COVID, you know, we became increasingly a darling. We were a darling enough to be able to take the company public, to your point,

at $8 billion. And then in COVID, even more of a darling as folks chased the stock up and more folks became exposed to the brand and the value that the product brought them as sort of the added sales drive that COVID brought as that started to wear off. The same folks in the market who were our biggest cheerleaders very quickly were pushing back on the company and wanted to, and there became some turmoil internally. John Foley ended up needing to leave and there were investors who were trying to chase him out which was insane

but it's what happened those are the same folks who wanted to chase him up right and the board made this unique decision to bring on a former CFO businessy person who had worked in subscription businesses but had never worked in a or seen a business that touched hardware, software, subscription delivery services

all in one, had a very, very narrow view of what a business, what a business is, you know, when it's just a pure software subscription business, very, very different, very, very narrow view. That terribly tainted his ability to operate the company, but the board chose to install this person as a new CEO. They asked me if I would stay. and be willing to keep at it. And I said, of course, this is still also my company. I'm here, and I appreciate you guys reaching out and wanting me to stay.

So I'm in. And two years of doing that, the board would check in with me on the side every once in a while, which is also a funny thing. And one of these particular calls, I'm on with two board members. And I remember I was standing on the baseball field for my son's baseball game,

and I was on the sideline and having this quick conversation with them, and they were checking in. And I just started going through, and they were like, what do you think about this person? How do you think about that person? What do you think about this? And I actually just started going through all of the people on the senior leadership team. And one by one, I went through every single one,

and I gave them a reason why that person was terrible. I was like, this person's terrible and here's why. This person's terrible and here's why. This person's terrible and here's why. And then I stopped. I stopped. And I was like, oh shit. Did you guys just hear what I said?

And they're like, oh, yeah. And I was like, no, do you understand? Like, that's not me. If I just said that every single person around me isn't right for the job, who's the odd man out? It's me. I was like, I think I know exactly what I need to do to fix this problem. I got to go.

And they're like, no, wait. I was like, no, that's the answer. Got to go. the next day I walked in, I walked into Barry McCarthy's office and I told them, listen, I am I am here. I'm here to do this. We probably need to find a way to get me out of here. And here's all the risks why, which included, I don't think you're doing anything right or the people you've brought around me are any good. So clearly I got to go. Wow. By the way, it took a year. maybe six months or a year for me to actually like get out from from there but you know yeah that that effing sucked um and i still don't like it today and and there's parts of me that are really pissed off about it but also uh it had to happen wow that well first of all thank you for sharing and i

think it's those hard moments that everybody's facing i think it's just a question is who's talking like who's being more transparent about it but walk me through where at that point when you leave or when you say you leave, you don't have a plan B. Like you don't, like you need to reinvent yourself. So walk us through a little bit because you reinvented yourself to a very different environment. And like you said, the fast food industry, et cetera. But where is your head when you try to reinvent yourself? Because Tom's identity, I assume, is just a thousand percent peloton.

Like this was you. This was your identity. This was your like your well. being like everything was Peloton. And I assume, and now we need to change. Like, how is that taking you? Or where is it taking you? That was an interesting thing to unwind from, to unwind from the brand I helped build. And yeah, that part of my, that very deeply embedded part of my personality and my family, you know, my wife and I, my wife and I got married in 2012 as we were starting Peloton, we had our first child at the same time we were opening the first studio, right? And like,

all these things were just so, right, these things were all so intertwined in my personal story and our Peloton growth story. So that was interesting to have to like emotionally unwind in that way. But one of the things that I felt really strongly about was I need to just leave because if I don't leave, I can't possibly like see clearly. I can't possibly like begin to understand myself outside of this context as long as I'm still here. So I need to rip it. I need to I need to rip myself away in order to go and feel what's next. And so that was that was the hard part, but it was also clearly the right part.

And I was determined to do it. So I did it. Again, back to relationships. So now, you know, I'm, I'm gone and one of the early Peloton investors, whose New York based, reached out. I talked to lots of people. This is just one interesting story that led to the next.

And they reached out and they said, hey, we heard you bored. Yeah, that's true. You can use our office. I live in New Jersey. You can use our office in the city anytime you want. If you just need a place to work, we'd love to, like, introduce you to some of our to some of the folks that we've invested in,

come to a couple of our happy hours. I was like, great, I'm in. And I did a bunch of things like this. It was just with these guys is where eventually they came to me. They were like, hey, so we invested in a restaurant company, and it's a vegan robot restaurant company. Would you talk to them? I was like, what?

And they were like, well, it started by the guy who started Chipotle. And I was like, oh, yeah, okay. I mean, Chipotle, I think I was powered by Chipotle through my 20s, so count me in. My kids still do, by the way. They're still powered by Chipotle. That's right. So they introduced me to Steve Ells. Steve Ells founded Chipotle when he was 27 years old in 1993. And he was at Chipotle for almost 30 years and then had left just before COVID. And then he was interested in doing his next thing.

and he was toiling around. And long story short, because of what he had started, he was able to raise a bunch of money. He started doing this vegan robot company. I think he had quickly realized that that probably wasn't the right plan. And so by the time I intersected with him,

we got to have fun together, thinking about what it was that he was actually trying to solve. And this was interesting for me to now just start to think about this other industry. And by the way, fast food is an even bigger market than fitness, right? Like, good thing. Everybody eats. Everyone should exercise, but they don't.

So inherently, the market is bigger. And there are numbers behind that, and you can go look them up. But he has a unique perspective on the fast food industry. So here's a guy who was a classically trained chef in his 20s, thought he was going to go open up his own chefi restaurant realizes that it takes money to open up a chefi restaurant so thinks I'll just open up this fast food joint and sell

some tacos and that'll get me the money to allow me to go and open up my fancy restaurant and so he starts and so he goes and he gets a small little shack in his home state of Colorado in Denver and he calls it Chipotle and he built the

furniture himself and like That's why Chipotle looks the way it does, right? Like it looks like made out of wood and metal that he got from Home Depot because he did. And he starts making burritos, but he also understood the value of a remarkable product. And he wouldn't call his food a product product, but I guess I'm a product guy. And because he was creating something better, people wanted it. Right? So Peloton was a much better alternative for fitness.

It was more convenient. It was easier access. It was better instructors. It was better quality. And so people wanted it. And so Steve ended up accidentally, right, creating a massive restaurant brand in America. You think that it's exciting that we took Palaton Public at $8 billion.

Chipotle today is worth $50 billion. Wow. That's crazy. That's amazing. Wow. Right? Okay. It's incredible.

It's one of the most storied restaurants in America. And so that was a cool story. So this is somebody I'm interested in. And we started to like each other. And so what I heard from Steve is, hey, the way I was able to build Chipotle was remarkable because I was able to, you know, because I didn't think I was building a fast food restaurant, I put a kitchen in my restaurant. We now, in America, call that fast casual, right?

But this blend of a kitchen in a fast food place. But so now having to scale to 3,000 restaurants around the country where, each of those kitchens can work repeatedly in the same quality and give you the same experience every single time, that's hard. But you do that with remarkable labor. And as the story goes, for most of the growth of Chipotle,

they had access to remarkable labor who wanted to do these jobs and who was good at cooking and could cook like grandma, as Steve often says. And so it was a great career for them. And it was, and it produced a great result. Fast forward to today, and there are less folks available to hire fewer folks who want these jobs. And the fast food world and the restaurant industry more broadly suffers from 150% annualized turnover. That means that every six months, your hourly staff leave, right?

Every six months. So what does that mean for the consumer? For the consumer, it means that quality has to go down because those people aren't there to, you know, to learn and appreciate and get better at this day in and day out because every six months, they're just gone, right? What does it mean for the business? Well, it means that now your labor costs are higher. Not because you're able to pay people more, which would be great. No, it's because you're now paying for this constant training, you're constant training. and rehiring pipeline, which is just a waste of everyone's time, you know, time and money. Like, it's a food place. Where do I want the money?

In the food. And so this is a bad situation. And it's really hurting the restaurant industry broadly and certainly quick service and fast food for sure. And so he identifies this problem and I start to get interested in it. And so that's like, so that's why I put robots.

Because if the humans don't want to do it, I'm going to use robots. And it's like, okay. A step too far. A step too far. But cool. I got you. I hear what you're saying, but okay, we went too far. And so I thought that was really interesting. And then food quality, right? So how do you continue to ensure that, you know, we have great food quality? And if you look in this sandwich submarket of fast food, which is where I live today, I know, exciting. But fast food, quick services, like $450 billion in the U.S., inside of that sandwiches is about. about 50 billion, somewhere between 45 and 50 billion in sandwiches annually. So this is a real market, right?

So it sounds silly that I now tell people, like I used to tell people I build, I build exercise bikes, now I tell people I make sandwiches. And so I like it because it sounds equally as silly. But it's real, just the way fitness was real. And there is a real labor problem and quality problem. And I think we can fix it. And so, and here's the quality problem. 50% of the revenue in that 45 to 50 billion comes from the top.

five players in the Quick Service sandwich space. Those are all derivatives of Subway. And there's, you can name all Jim and John's Jersey mics. They're all derivatives of Subway. They're more or less the same, the same product. And I'm not knocking on these things. I'm just trying to be a matter fact here. They all do the same thing. They're processed meats called cold cuts on manufactured bread. That's it. And so there's a real opportunity to come into. the market and offer humans something better. What if I can give you real cooked meats, whole meats, on proper bread? So at counter service, we make sandwiches. Guess what ingredients are in our bread? Flour, water, yeast, salt. Those are the ingredients that are supposed to be in bread.

Do you know what happens when you only make bread with those ingredients? It goes bad in two days. It goes bad in two days. It goes stale in two days. So if you are a fast food restaurant, you don't want that. That's why on average, these other players have something like 20 plus ingredients in there. I know, because it stays soft forever, but it's like disgusting. That is weird. It is wrong. It is not right.

There's something bad happening there, right? So cool. There's an opportunity. What if we could make something better? What if we could figure out the technology that drives the supply chain that allows, us to make bread that goes stale in two days and serve it in a fast food environment. Wow, that would certainly elevate your option in that very big market. What if instead of making meat by grinding various parts of an animal into a loaf and shaping it

into this uniform thing that oddly doesn't go bad? what if we just, like if I were going to make you a roast beef sandwich, what if we just, what if we just roast the beef? You know, how about that? I mean, and the cool thing is like, makes it simpler, right? In one regard, and more complicated than the other, because when you actually take a whole muscle meat, a real actual piece of the animal,

and you season it with salt and pepper and olive oil, and we roast these things and then suede them in many cases. and then we use what I call traditional culinary techniques, aka in this case, we freeze it, right? That's a great way to preserve something without pumping it filled with gases and preservatives and whatnot. So that helps us a little bit, but still, you know, that doesn't last all that long.

And once I put it in my restaurant, it's got the shelf life of the thing that is in a refrigerator, which means I'd better be really sure about how much I'm buying, how much I'm making, how much I'm putting in that refrigerator, when I'm taking it out of the refrigerator, which comes back to now leveraging technology

and the state of technology where we are today, in this case, thinking about predictive models and how we can speed up decision-making so that it could be more accurate in this particular world so that I can move that supply chain. and then on the labor side, how can I make it so that my restaurants are smaller and simpler to operate so that I can hire fewer people who I pay more and then give them jobs that are less cognitively taxing

so that they're happier throughout the day and want to stay longer. And again, now I'm using technology now to help guide the employees inside the restaurant throughout the process of making and building these sandwiches. And that's what, so that's what Steve and I are working on today. It's called counterservice,counterservice.com, counterservice.com, please check us out. Right now we're delivering anywhere in New York City and hopefully in a town near you soon. That's incredible.

So counter service now. So tell me for a second, first of all, if people want to check you out, they're going to go to the website. What should they expect? You know, give us like a little. of it so that we'll create a little bit of FOMO here for everybody to try it out. Before I get two nuts on sales pitch, let me help out the actual cause of your podcast real quick, just to rewind.

I hope you heard because I felt it how excited I am about what I'm doing. It's real. And once again, I got the things I like the most. I get to work with people who are remarkable. I get to work on a project in a business scenario where I think we're actually going to do something good in the world, and my God, it's complicated. But guess what? There is no chance I could have been here if I stayed stuck at Peloton. And so being able to get to that moment where I was able to say, oh, no, this isn't right. This doesn't meet my values anymore.

I don't agree with these people. As much as I'm attached to this thing and as much as I love this thing and by the way, I thought then and still think now that I can crush that business, I got to go. If I did not go,

I could not be here today and here today is a remarkable, awesome place to be. The team I have around me, I love this team. The things that we're doing, I love what we're doing. Do I know if we're going to succeed?

No idea. I know if we're going to see him, tell that? No idea. Do I sure is how I want to? Yeah. Yeah, I want to. Does the team around me want to? Yes.

And so when you come to counter service, you're going to feel that. And you're going to taste it. You're going to, I think you're going to have the best, the best damage of your life. You're going to feel good about the fact that it's made with real stuff. We can all debate about the qualities of health and what is health in any particular decade, because the goalposts change about what people think of. healthy, but at least, you know, at least real. And I like Steve's refrain of cook like grandma, the stuff that you would add to, you can identify in your own refrigerator, you know,

in your own refrigerator, right? Like, you know, okay, at least, you know, that's good, right? And so you come to counter service, we make sandwiches. We also have remarkable sides, but that's what we do. We make, we make sandwiches, we make great sandwiches. There's standout sandwiches. And that's you expect. You could expect fast service. You could expect that to be generally friendly. A fun environment that doesn't look like every other weird fast food place. We've got two chefs from the back of Michelin Star Kitchens who have been working on these recipes. So these are, I think we've got something special here. Please come check us out. If you think I'm wrong, let me know if you like what we were doing, tell the world.

Spencer, you got that. If you don't like it, you just tell me. If you do like it, tell everybody. Let's just be clear about how that works. Exactly. I need to go check you guys out in New York. But maybe, Tom, two last questions, if that's okay. One, I assume you could have just slurped bochitos on some kind of beach

instead of like going back into full-time, another company, another thing. where do you find the energy? Is it because you just suddenly fell in love with another thing? Or you're like, this is who you are? What do you think? Yeah, I think it's a combination of things. I think there's like, they're positive and negative traits that, that are at work here.

So, focus on the positive ones. Like, yeah, I mean, like, I, you know, this stuff is intellectually stimulating and if I'm going to be here on earth, I want to participate. That's certainly part of the drive. I'd say that the negative sides of it, and I only say this out loud just because I'm sure other people

suffer from negative thoughts every once in a while, so it's always fun to make sure that we all know that we all do. It's like, I'm not sure if I was successful yet. I don't know. Like, what does it mean that, I would have stayed at Peloton longer, but I couldn't, you know, does it mean that I failed? Does it mean that I have to go try again to not fail? If you've got time, I'm happy to unpack these thoughts with you. But, you know, I don't know. It's a combination of those things. Wow. I mean, first of all, I want to thank you for saying it because I think everybody feels those things. They just don't talk about it. But they also don't associate. associate Tom with those feelings because to us you ticked all the boxes of success.

So I think it is really important to, you know, maybe say a few words because I think a lot of our listeners, they also, you know, like tick their own boxes of success. But there's a lot of doubt of have I arrived? Is there more, I don't want to feel like I'm losing relevance. Like there's all these things that are coming piling together. There's so many positive things that have come from all the fun stuff that I've gotten to build. Most importantly, I've gotten to build our family. And I've got three kids, and they're crushing it.

And they're all different and, you know, in their own way. And that's a ton of fun. I think my wife still likes me. So that's good. know, and I don't have to do Iron Man's anymore to keep up with her, which is great. Really great. So what's also interesting is like, yeah, I never, I never expected to make all sorts of money in life. And by many accounts, I've been afforded that thanks largely to, thanks largely to Palatown and being able to turn it into a public company. And that was, you know,

That was remarkable. And, you know, that's an interesting one because that one is met with, you know, mixed reviews depending on, depending on where someone intersected the story when I talk to them, they think of me as either a remarkable success or a failure. And I always find that funny. I actually met this guy. This was random in our counter service restaurant. and he was just a person who walked in to buy food, but it's New York. And he,

one thing led to the next, he kept asking me questions, and I was there working the line, by the way, I was there working the bagging station, but he kept asking me questions, and I try really hard not to, like, let it go beyond,

like, I'm a guy who works at counter service, but, like, he kept pressing and pressing and pressing to the foot before we got to, okay, fine, I'm the co-founder of Pelton. And his reaction was, shocking and and I laughed that the people around me were like devastated and he was like oh my god you lost hundreds of millions of dollars that was his reaction to me literally first words out of his mouth and it's like wow that's really an interesting perspective right you what you see is that my

stock was worth this at some point and then it was worth this and so you've equated that to some some gain or loss and you've chosen the loss side. Forget about the fact that like in 2012, we raised $400,000 and we had nothing. And we turned nothing into a public company at $8 billion. In a known brand and everybody knows you guys and it's like it changed a world. Like we can go on and on that. We help humans along the way.

And like all sorts of good stuff, right? And I've been afforded a really good life because of it. But there's this other piece of now when people tell the Peloton story, I hear like the rise and fall of Peloton. And I'm like, really? Like the fall? Like, okay, like there are peaks and valleys in life and journey. But I struggle with this and I struggle with this as the story.

And what does it mean that that's become the story? And does it mean that I have to answer the call? But you're only going to get these things from losers. Like you're never going to ever get. this from somebody who is actually tried to build anything, right? Like, it's just not possible because they know what it's, like, they realize at least like a little bit of what it took. Like most people would never ever know what it's like to build an $8.1 billion that changes the world, but most people know what it stakes to try to build something. So you're only going

to get it from the losers, right? I think so. But the other side of it was on the upside, right? So on the upside, you would hear the, like, some people would be like, wow, congrats on what you built. Other people, you can tell there was like an edge there or something. And then you'd hear like, well, I mean, better lucky than good. It's like, wait, what? Are you equating everything that we just did for the last 12 years as just luck? I mean, I get it. I get what it means to be in a privileged position.

and I get what it means that time and place and chance are a real fucking thing in this world. Yeah. But you needed to create your own luck. You needed to like actually have a thing. But yeah, those, you know, so all those. That's amazing. All that stuff is hard and I'm sure it's hard for everyone. Yeah.

And so again, just back to like, you know, not being terribly emotionally aware and having a really bad memory helps. So what would you say to your younger self, if you met yourself younger and we'll kind of finalize with that? What would you say to younger Tom or somebody that is in there like trying to figure things out mode? I think I stick to to the answer that I've given in the past, which is I say absolutely nothing. because as much as I can talk to you about, you know, struggling with it did it or did it not work or is it or is it not working, I can absolutely tell you that I feel real good. And I wouldn't want I wouldn't want young Tom to go in a different direction. So, you know, let him not know and end up here. And I think we're good. Yeah, we have a good life. Amazing. So Tom, I mean, I can't wait

to try you guys out one day in New York. And when should we expect you guys also in California and other places? Is it coming soon? Is it coming soon? We're going to try. I mean, it's just like growing Peloton's capital and tons of business. So we're proving the market in New York in 2026 and 27 will probably be in a second market. I think it's probably going to be Dallas, although we haven't said that publicly, although I guess this is now public.

But you can't really take my word for it. Who knows? And then we're going to go from there. So counter service. Amazing. So we're going to get to check you out, Tom. Thank you for the, like, the extra time, the honest conversation. Like, this was like, I could probably talk to you for hours. Thank you for making the time and being so awesome. Thank you, Alana. This was fun. I hope you, I hope your listeners enjoy. Wow. I have chills from this episode. Like hearing from somebody who built such an incredible company with so much impact about him also having all these feelings and dark moments. Like, how inspiring?

So first of all, if you know somebody that this will actually make a difference for them, please share this episode. It means the world. Plus, it really helps us continue to bring amazing, amazing guests. So, you know, go think of somebody that this will put a smile on their face or get them a little more inspired or make them feel a little better and go share it with somebody you love. And now I want to answer. Remember, we have a question from Nira on our YouTube channel, which is Leap Academy.

We see Lana Golan, go check it out, put your questions so that we can answer them here live. And she asked, how do you cope with dark moments? And first of all, it's beautiful because we actually answered some of this with Tom. But the one thing that I'll say is in terms of dark moments, realizing that feelings, especially the hard feelings, they're somewhat like a puppy. And you know how a puppy, when they'll try to get your attention, they'll try to get your attention, and if you push them away, they'll try even more. And the hard feelings, like, they're kind of like that.

Like in a puppy, if you actually give them attention, they'll eventually just roam around and go somewhere else, right? And the heart feelings are somewhat the same. So if you continue to try to push it away, it actually comes and amplifies it like three in the morning, and it's just like, you know, it's hard, it's suffocating, it's hard to breathe, et cetera. And hard moments, if you actually take a moment,

and actually name it, name the feeling, feel it, notice it, pay attention to it, and just say, you know what, yes, I feel it. I have a really hard moment right now. I feel it in my throat. I feel it like I can't breathe. I'm embarrassed. I'm, you know, defeated, whatever it is that comes up for you. But name it, talk about it, like feel it. Don't live there, but pay attention to it because the truth is you need to pay attention to it, but you need to not live in those dark moments. The other thing that really, really hopes us is to start celebrate the little wins and take basically count of all the good things that have happened. And I think sometimes we are our worst critics. Like we look at only the dark moments and we let it take us down

versus start taking stock of all the amazing things that we achieved and where they brought us. So make sure to celebrate the little wins, add up all the wins, all the things that you achieved. Make sure to keep on reading through them. Make sure to have your list of awesome so that you can read through it, you can feel it, you can feel great about it, you'll know what you have actually achieved. And that's going to let the dark moments just not take you down. That's it. I hope you enjoyed this episode.

I hope you enjoyed this conversation. And I'll see you next time. Hey, I hope you enjoyed the conversation on the Leap Academy with Ilan and Golan podcast. How powerful was this? Look, if someone in your life needs to hear this today, please share it with them. Let's make somebody smile today. We are on the mission to help 10 million people reinvent, leap their career, become their best version of themselves, tap into the hidden market and create not just a paycheck, but the life

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