In itnig’s Podcast #23 Bernat Farrero, CEO at itnig and Pau Fernández, CFO at itnig share their point of view on Gymforless’ exit. How did the company start, pivot, live the change of CEO and reach an agreement with Sodexo which lead to the sale of the startup last week.
For this Podcast #24 dedicated to the story of Gymforless, Bernat Farrero, CEO at itnig, Pau Fernández, CFO at itnig, César Migueláñez, Product Director at Factorial, Roger Dobaño, Product Manager at Quipu and Bettina Gross, Talent Acquisition at itnig come together to talk about the beginning, the pivots and the exit of Gymforless.
Gymforless started out as a flexible model on how to use gym, directed to final consumer offering fitness tracking. Instead of models like Freeletics or 8fit, whom we have previously spoken about here at itnig, Gymforless focussed its tracking on workouts at the gym.
Guillermo Libre started out with the project and from itnig we supported him in tech development and an initial investment. The work on the b2c segment was very intense and it cost us a lot in marketing and customer acquisition, bringing only small margins.
Transition from daily pass to club, membership
With this panorama, Guillermo made a first pivot from a Daily Pass (pay per use) model to a Club Pass (a subscription) model. It was a hard decision, we were scared leaving something behind that was working and it seemed like a dangerous move.
It’s hard to leave something that is working, even though it’s not your core business.
After all, this was a very important change and from the on the project had a new direction. We were adding more features like rewards to work on churn. However this was only the first of many changes the startup would go through.
Guillermo, founder of the project had to leave the project and move to Madrid. In most cases such a change of CEO in an initial phase is the end of the business. Not in Gymforless’ case. Guillermo knew Oriol, current CEO, from working together in the past and he joined Gymforless to lead the startup through the next adventures. Oriol had extensive experience in Sales and B2B.
Pivot to a new direction — going corporate
The next step for Gymforless was a change in its customer target base. We started acquiring companies and offer gym as benefit for employees. The companies were very receptive to offer these kind of benefits and we soon had a working model. Oriol’s experience in B2B Sales helped this pivot from consumer to corporate business tremendously.
This change made the relationships with the gyms easier as well. Gyms no longer saw us as a threat, or cannibalization of their customers.
Listen to our podcast to learn more about Gymforless’ beginning and exit story. Learn more in this Podcast in Spanish on our Youtube channel, listen to it on iTunes or enjoy it through iVoox and subscribe to our newsletter to stay always up to date.
The story about how a Mexican and a Czech built an international company starting in communist times
In itnig’s Podcast #23 Arturo Quintero, partner at itnig, shares the story of Moravia with us: How he set up the translation company together with his partner in the 90s, how they internationalized and created a global structure and what he has learned in the process.
Moravia is the story of a project that starts in a local market, is proven and reaches success and then takes the next step to internationalise.
For this Podcast #23 Bernat Farrero, CEO at itnig and Jordi Romero, CEO at Factorial meet with Arturo Quintero, one of our partners at itnig and founder of Moravia to talk about his experiences.
Arturo grew up in Ciudad de México and with luck found his way to study in Poland. During the communist regime, without any political interest he found himself studying in Krakow. “I spent some years there until arriving in Budapest where I met a student whose parents were translators. At that time there were only governmental translation agencies but as you know in this time there were a lot of changes in Europe. Dynamic times when all services like transport and restaurants were liberated. So if you had an idea there was a good chance to build something.”
This is when Moravia, named after the region in Czech Republic, was created. Today it is one of the biggest companies in its sector with a yearly revenue of 50 million $, a strong client base and presence in 9 countries.
It was a great adventure of 22 years leading this company!
You tell your story so easy, but a lot of times this internationalization is hard. How did you take your first steps out of the Czech Republic?
We had big ambitions as we kept seeing that what we were doing was satisfying our clients. They were happy with us. Our business idea in itself is multicultural — localization means adapting the product as if it was created locally — so going global was a natural step for us.
To a certain degree you have to follow your intuition, to just go for it, but you also need a bit of structure, a plan. It’s a mix of both.
Who were your first clients?
Tech companies like Minolta and Hewlett Packard. We were doing translation from English and Czech. And they were looking for local companies to translate manuals and later on displays of photocopy machines. We also started working with Oracle, who already had a team for European languages in Holland, and they gave us their first big contract for Czech. Oracle really liked what we did and asked us to translate to Polish as well. So we set out to create an office in Poland and started working. Next up Hungary and soon we were known for localization to ‘exotic languages’ like Bulgarian, Hungarian…You have to remember the times! There was no internet and all technology, like translation memory, was new.
These first assignments allowed us to see the potential we had. Our goal was to work for Microsoft.
And we finally reached this goal of working for Microsoft in 1995. We added more and more languages and employed technology to help us in our processes. Translation memory is such a technology that allows you to recycle translated pieces as they are saved with their source. The software analyzes the text so that when a similar phrase appears, the translation can be reused. This makes the process quicker, consistent and efficient as we can use content created by other translators in our network as well.
Business model — What is it and how has it evolved?
We follow an Enterprise model lets’ say with few clients but high volume.
When we started out I was the first sales person. Before there was Internet getting access to people who know a certain language or people who know a certain technology was really hard. I am not saying it’s easy today either but there are certain advantages. I was the one who brought the first clients, at that time I did not even consider myself a sales man but if I look back at it, yes I was doing sales, growing our company.
Later on you need a process, a sales methodology and a lot of discipline. As we were working with big companies, they already had processes in place and a clear budget and visibility of the market. However, when the buyer has a lot of knowledge, it makes it also hard to defend your prices and keep your margins.
What is most impressive for me is how you opened up new offices in different countries. What does it mean to open an office in Japan or China?
Every experience was different and we were learning continuously. In general there were two reasons to open an office:
be closer to our clients
have a cost advantage in production.
China, Czech Republic and Argentina were places with highly qualified people, high talent to develop software at competitive costs. Japan, USA and Ireland were close to our clients, here our sales was strong working on product acceptance, budget etc. Translation is always done by an agency with translators — we do the compilation and quality control.
How big was your sales team by country?
We did not structure our teams by country. Our customers, take for example a company developing software for architecture with Asia, Europe and the Americas decide whom to work with. We had to convince all three of these points and we realized they were very well connected. I could not offer a discount to the office in Singapore as there was direct communication with California office. We replicated this structure in Moravia as well. Connecting our offices and making sure we had the same communication.
Operative point of view : Did you move the HQ of your company from Czech Republic to another place?
No, it remained in Czech Republic and from there creating subsidiaries. When I left the company, of course, I don’t know what changes have been made.
There were enough consultants who came and offered a move to Ireland. But it was never our goal to maximize for tax purposes.
Venture Capital — Have you ever raised outside capital?
No, every year was of growth and profit so we were able to reinvest our profit into growth. When I left private equity entered the company but not before. We did not need it. Now looking back I can see that it could have been an advantage but it had never crossed our minds before. I think venture capital allows you to be faster. You are able to
grow more quickly,
implement technology &
do strategic acquisitions.
It’s not just the money but also the people behind it with their experience who can guide you in the growth in the company.
Why did you decide to leave Moravia and how was this process?
There is not one reason. With the birth of my daughter my perspective on life changed a bit and there were different dynamics with my partner as I was looking for a more aggressive growth as we were entering a more competitive market.
It’s a pleasure being part of the beginning of such a successful company.
Listen to our podcast to learn more about Arturo Quintero and Moravia’s story. Learn more in this Podcast in Spanish on our Youtube channel, listen to it on iTunes or enjoy it through iVoox and subscribe to our newsletter to stay always up to date.
Gymforless has been acquired by Sodexo BRS Spain on February 1st 2018. Gymforless is a market place that gives access to more than a 1.000 fitness clubs to consumers and employees — combining thus a BtoC and BtoBtoC model.
From a simple gym access app Gymforless has become a benefit plan for companies, offering a better quality of life to their employees. As such Gymforless has attracted the attention of Sodexo Spain and the group has decided to acquire the startup. The leader in the sector of restaurant tickets plans to integrate Gymforless into their portfolio of services dedicated to contributing to the quality of life of employees and their motivation.
In this short video interview Oriol Vinzia, CEO of Gymforless talks about the past, present and future of the company:
With this acquisition Gymforless will become part of strong group while maintaining its autonomy.
“They know we are a startup and they understand we need to be able to grow at the pace of a startup.”
“If we integrate completely they know we’ll lose speed. In a few years the structure will definitely be different but at the moment we we will remain independent while creating partnerships with their existing clients.
Corporate wellness is a trend. Everybody talks about it and it becomes more and more important for companies to offer benefit policies to retain their talent. Everybody wants to work out and have it as easy as possible. With Gymforless companies can give their employees just that!”
Oriol, how did you start at Gymforless?
I joined Gymforless after the startup was founded and had been working for about a year. Guillermo Libre whom I met through Groupalia while we worked there together called me.
It was easy for him to convince me as Gymforless combines my two passions: sports and ecommerce. I started my career at Decathlon and later switched to online while working at Vente Privee and seven years at Groupalia, in the sales and marketing area.
How was your start?
When I joined Gymforless, Guillermo who had founded the company was about to leave so right away we went through a change of leadership.
The change of CEO in a very young company is not easy — I had to integrate in the team quickly and take new steps in a new direction together. As an app we started selling day passes but then pivoted to what you now know as Gymforless Club. Through our Club app you get to access different gyms in your area, you get to chose the day, activity and sports center.
The market is very competitive with a wide range of independent gyms and only very few gym chains it is also very fragmented and dispersed. We bring the gyms together so that consumers can chose easily. For gyms we bring them new users who discover their activities — Gymforless brings them extra revenue.
How did you approach sales and expansions within a city?
When Gymforless started it was not easy to sell — we did not have the app but had to sell the idea and there was nothing comparable to Gymforless in the fitness industry. So we looked to other areas where similar models are working. Booking.com does the same for hotels or ElTenedor for restaurants. We were a new player in the market, so it was first hard to explain it to gyms but after the first year the acquisition of customers has become much easier.
First we needed volume of partners and then we brought the customers. We were generating a high volume of transactions and we realized that this was an attractive offer for companies. Now we have a team dedicated to acquiring gyms, another team dedicated to acquiring companies as customers who offer Gymforless as a benefit to their employees and thirdly we have our marketing team concerned with acquiring final consumers. With this new area dedicated to b2b customers we were able to grow much faster and we’ll see what this new partnership with Sodexo will bring.
