ClassPass is an American fitness startup company based in New York City and founded by dancer Payal Kadakia and Mary Biggins. The company offers a flat-rate monthly subscription service to get access to participating fitness classes in 30+ American cities, as well as in Toronto, Vancouver, Sydney, Melbourne and London. Sanjeev Sanghavi was the company's cofounding partner—he left in January 2014. Before starting the company, Kadakia worked for Warner Music and is a graduate of MIT.

History

The company was originally called DabbleNYC, then renamed to Classtivity. An earlier version of the company's product was intended to sell a better registration system to fitness studios but this didn't receive much interest. After participating in the TechStars accelerator, the company switched to offering a package deal where users could pay $49 for ten classes in a year, a model that Kadakia likened to Groupon. Users of the service wanted to use the pass service again so the company switched to offering the 'Passport', a subscription service for $99 a month. The company enforces a cancellation fee of $20 for missing classes. As of 2016, ClassPass has booked over 17 million fitness reservations.

Founders

Payal Kadakia

Payal Kadakia is the CEO and co-founder of ClassPass, a monthly membership service that lets users attend a sample of fitness classes in certain cities. Payal Kadakia, an Indian American trained in Indian classical dance, grew up in Randolph, New Jersey. In 2005, she graduated from MIT with a degree in Operations Research. After college, Kadakia worked as a consultant at Bain & Company. She went on to work at Warner Music Group. In 2008, while working at Warner, she additionally founded Sa Dance Company.

After spending over an hour searching online for an open ballet class she could take, Kadakia had the idea to create a search engine for fitness classes, similar to OpenTable. In 2011, Kadakia founded Classtivity with her then business partner Sanjiv Sanghavi. In January 2014, Classtivity was rebranded as ClassPass.

Funding

ClassPass received seed funding of $2 million in March 2014, then attracted $12 million in Series A venture capital funding from entrepreneur Fritz Lanman in September of 2014. In 2015, it closed a $40 million round of Series B funding from General Catalyst and Thrive Capital. The company was valued as being worth more than $200 million according to a report in the Wall Street Journal.

Criticism

The service has attracted criticism for undercutting the business model of the fitness studios that it relies on, with an article in the New York Times describing it as a "middleman" between consumers and fitness studios, and arguing that a "power imbalance" exists between the studio owners and ClassPass which mirrors the relationship with additional digital intermediary services like Amazon.com and Uber. A perhaps unintended consequence of the ClassPass business model is that in Washington, DC, users don't have to pay sales tax for the subscription as they would have to if they were paying directly for classes or memberships at the individual workout studios.