Over the past few years as a student of yoga, I have noticed in my visits to various yoga studios that most of them use the same back-end software to register and pay for classes, book appointments, purchase yoga apparel, track yoga student activity, and generally handle any business tasks. Those that do not have such software generally manage these tasks with pen and paper and/or a spreadsheet, which in this day and age, seems pretty outdated! I most enjoy going to studios with easy reservations and purchasing of classes, and many yoga studios have been moving in this direction to improve the experience of their students both on and off the mat.
This ubiquitous software that I see every time I try to register online for a class or in-person at the studio is managed by a company called MINDBODY, which went public this past summer. MINDBODY provides health and wellness software that allows its wellness center (studios, spas, etc.) clients to streamline their business activities via appointment and class scheduling, marketing and analytics, point-of-sale purchasing software and a mobile application for consumers (among other features).
For example, in their pen-and-paper days, studios and wellness centers could pour over handwritten records of student class attendance to determine which classes were most popular, and use that information to determine which teachers to give more class slots and which times of the day were best. However, the information was likely incomplete at best and difficult to analyze. MINDBODY software automatically tracks this information and creates reports, which allows studio owners to make scheduling decisions based on sound data rather than relying on word-of-mouth and observation.
I view this company as a winning innovator in bringing technology to the health and wellness industry for two key reasons.
First, MindBody found the right industry niche that is ripe for a technological overhaul: health and wellness. The industry is extremely fragmented, largely composed of small independent yoga and fitness studios, spas and gyms, many of which do not leverage the back-end business management technology currently available to services businesses. Most of these centers are accustomed to booking appointments, tracking clients, and performing other similar business tasks via pen and paper or simple spreadsheets, and do not fully capture all of the value available to them. MindBody found a way, via a set of cloud-based software tools, to help its clients create and capture more value for both the studios and the students / consumers.
MINDBODY is a first-mover, and has little to no competition due to the lack of technological advancement in the industry. The industry is also growing, as consumers in the U.S. and around the world are becoming more and more focused on their physical and emotional health. As of the summer, MINDBODY had approximately 43,000 subscribers, out of a potential 4.2 million wellness businesses. This 1% penetration suggests that MINDBODY is positioned to capitalize on the growth that is occurring as these wellness businesses start to incorporate more software-based business tools.
Second, the network effects of MINDBODY’s consumer-facing mobile application and its point-of-sale software make the company indispensable to its clients. One of MINDBODY’s key consumer-facing features is MINDBODY Connect, a mobile application that allows fitness enthusiasts to manage all of their classes (at different studios and fitness centers) with one log in. They can see the classes available in their area, with reviews and instructor bios. The more people download and use this app, the more valuable it has become because it’s one-stop shopping for finding and signing up for a class. Providing point-of-sale purchasing software is clever because switching systems becomes more and more difficult as studios enter their students into the system, and save their payment information for automatic class sign-ups. Both of these factors make MINDBODY crucial to the experience of studio owners and consumers.
As of now MINDBODY is bleeding cash post-IPO, but as they increase their presence across small and large fitness chains and studios, I believe that their choice of industries and vertical expertise will help turn a profit, a boon for both MINDBODY’s studio clients and fitness students.