Thirty Minute Mentors Podcast Transcript: ClassPass Founder Payal Kadakia

I recently interviewed Payal Kadakia on my podcast, Thirty Minute Mentors. Here is a transcript of our interview:

Adam: Our guest today is the founder of a billion-dollar business that disrupted the world of fitness. She catered to customers in more than 30 countries. Payal Kadakia, is the founder of ClassPass, which was recently acquired by Mindbody and is the author of the new book, Life Pass. Payal, thank you for joining us.

Payal: Thank you for having me, Adam. It's great to be here.

Adam: It's great to have you on. You grew up in suburban New Jersey to Indian parents who instilled extremely strong values in you, including a clear definition of success. And you enjoyed early success academically and professionally. You went to MIT, you worked for Ben right out of college. Can you take listeners back to your early days? What were the key experiences and lessons that were foundational to your success and to your understanding of success?

Payal: Great question. I grew up in a small town in New Jersey, where I think the first big part of my identity really emerged because I actually didn't fit in with the people in my town. I was an Indian girl, most of my town was American. And I really didn't know how to live the same life and live the same way as other people. And I always felt different. And I know, to a lot of people, feeling different can become a weakness. But I think since I was younger, what I really learned to do, and I think part of what helped me with my success is, I learned to find a way to bring out my identity. And that really, for me, came out in Indian dance, which was something that my parents put me in when I was very young. And this built me a community that was near me that resonated more with who I was. And most importantly, I found a teacher, my Guru Ji, who is in India. We call a Guru Ji somebody who bestows knowledge upon you. And while she was my dance teacher, what she was really teaching me is the foundation for life and how to really show up. And so, I think meeting her and being a part of this Indian community was one of the most defining parts of my life, because like I said, they gave me a place to belong, and helped me understand what environments I could thrive in. And at the same time, she also set me up to, like I said, be prepared for life. And the only other parts that I would say is, you know, my parents, they made a lot of sacrifices to come here by immigrating from India in the 70s. They gave up everything they knew to build a life for me, my sister, and I knew it was important for me to carry the weight of that in anything that I was going to do. So this was sort of a double-edged sword, because it gave me a lesson plan on hey, yes, I gotta go get a good education, I got to go get a good job. But it also didn't always allow me the way to fly, in my own way. And I think that's really what I had to learn on my own as I got older is, what does success actually look like to me? And not just to my parents and to the people around me?

Adam: What does success look like to you? What is your definition of success?

Payal Kadakia: I have learned that success is truly a journey, it is not an endpoint. And it is the journey towards living in a way that's purposeful and living in a way that's impactful. That is when I feel the most successful. I know I have accomplished a lot in my life. And I'm very proud of that. But at the end of the day, what really feels the most fulfilling is knowing I had an impact on people's lives. And that, to me, is success. And having that ongoing, not just one day where you get to hit some milestone, is really a part of what makes success what it is.

Adam: I love that. And something that I tell audiences that I speak to is, no matter what your definition of success is, you have to have one. Your definition could be different from my definition. It could be different than the definition of your parents, your friends, your neighbors, everyone else around you. But as long as you have a Northstar that you're focused on, you're going to be all that much more successful.

Payal: This is so key and I think is so important for everyone to hear. Your life is your own. And I think you've just said it so well. You have a true north in your life. And by the way, your true north is very different from anyone else's. We were all put on this earth to do something different and give to one another. So I think it truly starts with that but most of us have a block and even being able to find that, right? And so what I have learned through my journey, and I think it's really important for people to think about is how do you set boundaries against either people or parts of your life, or parts of activities that you're doing that are not necessarily serving you and your mind? In moving forward? How are they potentially trapping you, and you need to find your way out of them. I talk about this conversation a lot in my book about actually, my mom actually wanting me to get married. And it's a pretty obviously personal discussion. But it was such an important one that I realized from my parents. It's what they saw in me and what they thought was success. But I just realized, for me at the time, I wanted to build the company. And that was what was fulfilling for me. And I have learned and I think this is also another important point is, success happens on your own timeline, not anyone else's. And I think when we try to hit milestones in our lives that are carried by other people and other people's timelines, we are never going to be happy. And the more you start embracing your own life in your own way, you're going to build a muscle to continuously live like that. And so the sooner you can do it, the better you're going to be able to keep making the bigger decisions in life that are actually going to help you go more closer to your true north.

Adam: Payal, I'm not qualified to ask you about marriage. I would like to ask you about building your company. You're going down the corporate path, which so many of us do. I went down the corporate path, out of college, out of business school. You're working for the very companies that every top student at every top school all across America, aspires to work for. I've been there, you've been there, we've all been there. And you just have this feeling that there's something inside of you, you need to do something different, right? You give yourself two weeks, and you say, “I'm going to come up with an idea that I have to believe in so strongly over these next two weeks, that will compel me to walk away from this big corporate job that will push me to go and become an entrepreneur”. And you find that, can you take listeners back to that moment, the moment that drove you to try to become an entrepreneur and the “aha” moment that ultimately, had you dive right in and become an entrepreneur?

Payal: Yep. So this is back in 2010, right? So we're talking about over a decade ago, and at the time, entrepreneurship was not something most people were involved in or wasn't what people were talking about, most of my friends. As you mentioned, you know, they were in banking, consulting, doing things that were more normal and more expected of us. So when I actually decided to take a trip out to San Francisco, I was actually amazed by the idea of entrepreneurship. And most people would think that I would have known that because I went to MIT, which is obviously a very entrepreneurial place, I think. Because, I don't know whether it was because of the way I was raised, or just the classes I took, I never thought that that was actually going to be a career path for me until I went out to San Francisco and saw everyone working on ideas and apps. And it inspired me to put together two sides of me that I had always struggled with combining. Which was my creative side and my business side. I'd always sort of found two separate places for them. And I realized in entrepreneurship, I could bring them together. So that was sort of when the idea of just entrepreneurship came to me. And I remember, this was a weekend trip on Sunday night after I'd flown home, I started thinking of ideas. And I said to myself, “You know what, I'm going to make a career decision in my life right now, whether that was to leave my current job or do something else. Why don't I give myself two weeks to see if I can think of an idea. And if I don't think of an idea, then I will go back to exploring other jobs and the industry I was in or something else”. And so when I started doing that, my mind really shifted into this explore phase. So everything I saw on the plane as I was transporting home and commuting, I just started thinking of ideas. Well, how could I improve my life and other people's lives? And luckily enough, you know, 36 hours later, I had been training in ballet at the time in your city. I went to go try a new class because it just, you know, I was bored of the current class I was taking, it seemed like an easy thing I could do. I had my clothes with me, got onto the internet, opened a few web browsers searching for different classes. I had like 10 tabs open at this point. I couldn’t figure out which teacher is right for me and what time to go if I'm going to get there in time. And hours go by I ended up booking no new class and you know, I'm sitting there thinking wow,  how did this just happen? It's so easy to do this for finding a restaurant, and even ZocDoc at the time, which was for dentists and doctors. I just sort of thinking to myself, why not do this for classes. So that was really the “aha” moment where the problem came to me. And the only other thing I want to say is, it was deeper than just focusing on a tech problem for me. I have truly thought about dancing my whole life. And here I was in my mid-20s. You know, this girl, like you said, who went to MIT and Bain. And what most people knew me for during those years of my life was that I was an incredible dancer. And I was that person who was fighting to keep this passion in my life. And I realized by building something, I could take this fight on for everyone else. And that was really when the magic started.

Adam: What advice do you have for entrepreneurs who are trying to find the next big idea on how to unlock and unleash their creativity? You did it? What can anyone listening to this conversation do?

Payal: I think you really need to think about what problems in the world you want to solve, right? I think the best companies come out of solving your own problems. But then obviously, these are problems that the rest of the world or even other communities are facing. And when you have that in mind, what I love about that concept is, it's not a product idea, right? And I think I actually almost failed many times in my journey. Because I was stuck on a product idea, like I said, Open Table, for classes that actually didn't work when I launched it. But it was a product idea, right? It wasn't necessarily solving a problem at first. But I think the second you can anchor in on solving a problem, it gives you a true north. But we were just talking about a way to solve problems and make decisions. And I think that is really the most important thing. So you have to look at your own life into the things you enjoy doing. I think it's very hard to solve a problem that you're not completely invested in and completely familiar with, right? We were just talking about ClassPass and how much I use it and live and breathe the ethos of it. And I think that's really what made it a problem that I was able to solve because it was so apparent in my life.

Adam: And I love the fact that the idea that you had for ClassPass wasn't the idea. That was the billion-dollar idea and the business model that you had for ClassPass’s business model. Version number one wasn't the business model. That was the sustainable business model. Business model number two wasn't number three, wasn't number four. You had so many pivots along the way. And any entrepreneur listening to this podcast, can attest to the fact that entrepreneurship is all about being able to pivot. Life is all about being able to pivot. A key theme of this podcast, a key theme of my conversations with so many of America's top leaders, is that there's no linear path to success. And I want to ask you about that topic. How can entrepreneurs and business leaders most effectively iterate and pivot? And what are the best lessons you learned through all of ClassPass’s many pivots, big and small?

Payal: So first thing is you have to embrace failure. I truly believe the day I became an entrepreneur was the day I launched my first product, which was a year after I'd actually started the company and it failed. That was the day I actually decided, or not even decided, but that was the day I knew that I had to solve a problem in a different way. And that I stopped letting go of what I consider to be false signals of success; like how much fundraising I had, how much press we had, how many followers we had, those are not indicators of your business working, right? The indicator of my business working is people actually going to class. And that had to become defined as my real true north, not other things. And I realized I was confusing my team. And I wasn't even focused on the right metric in the beginning. And so I think it's really important to define that for you is, what is that metric that is going to be your true north to be able to solve, and on top of that, embrace failure, right? Failure is a data point, it is going to help you make decisions and tell you which direction to not go in. And the only other way that you can really counter that and almost avoid fail quickly is you have to put stuff out there as fast as possible. I spent a year building my first product, it was such a mistake to do that. By the time we launched our second one, I think we had it up in close to two months. And by the time we pivoted from, you know, our second product to third which was ClassPass and we had it up within a month. And I think that's what I learned is this stuff is, put it out there, see how customers react to it, iterate, learn, pivot and be scrappy. You know, I think that's what I really learned about innovation. Part of this is when we were really scrappy, we actually learned the most because we also weren't hiding behind the technology, and hiding behind the data. We were seeing firsthand how people were using our product because we were the ones placing the reservations and doing customer service. We weren't letting other things sort of stand in the way. So those would be, really, my tips. I would say, you know, move quickly, make decisions; fear of failure, you have to let that go. And don't get stuck on the false signals of success.

Adam: I love that. Understanding the right metrics applicable no matter what business you're in. And to that end, I want to ask you, how were you able to grow and scale ClassPass? And what advice do you have for anyone listening on how they can grow and scale the businesses that they're in? 

Payal: One of the biggest things is having a team, right? I think that is the crux of how I was able to build and scale ClassPass. I know what my strengths are, I know what my weaknesses are, I think it really comes down to being able to hire a team that's going to support you, and know the vision that you have. And I think everyone always knew that I had a grand vision for the company. And that was never going to go away. But I needed a team that was going to be able to really support that. And I think the hardest thing is finding the right people at the right stages for your company, especially, you know, when you're growing from points where, I think there was one weekend where we hired 60 people to get out into the markets, because we had a lot of competitors that were showing up everywhere. So you have to just learn how to, you know, grow quickly, hire fast and fire fast, right? I think that's sort of the mentality of the startup world a little because you just really need to go and move forward. But my adviser said this to me early on in a class lesson. I really believe this, he said to me, “It's your freedom to create lives and people”. And I love that because I think for me, especially as more of a visionary entrepreneur and someone who was creative in what I wanted to do, I realized that points for me, like I was getting bogged down in doing operations or doing things I didn't even want to do. And like I said, a team and someone who has actually even done this before is actually going to be much better. So you have to learn to let go on the right things. But also keep your hands on the right components of your business and that it's definitely a learning process. But you have to give yourself the time to be able to evolve and grow in that.

Adam: What did you look for in the people who you hired? And what are your best tips on the topic of hiring?

Payal: You know, from the earliest days of ClassPass, I came up with pillars. I know a lot of times people create cultural pillars, and it's something they do because, you know, they want the team to know what to do. I think for me, when I created the pillars, I actually thought about what I knew I worked well with; the type of team. And so my three pillars in the beginning were growth mentality. So I loved people who wanted to continue to grow, who were sort of humble, but thought that, you know, they can always do better, I love to be more efficient, I can't stand wasting time. And then my third one was positivity, because I just enjoy being around great people who are encouraging. And so, I kind of define that. And obviously, those who are more on a cultural side versus a skill side, are obviously very different. You know, I worked at Bain. And I think Bain had a beautiful way to hire people, which was more through case studies where you actually see how someone thinks. I have learned, especially in the startup world, in the beginning you really need to find people who can solve problems, right? The best person you can have on your team is someone who knows how to solve any kind of problem in the world, especially in the beginning. And so finding people sometimes I would literally just say, “Okay, like, come and work here for a week or two. Let's see how it goes. And if it works out, then you'll know. And I know because I work a certain way and you work a certain way, it's either going to jive or not”. And you know, every culture in different companies is different. And you have to find the right, you know, tribe that's going to make your vision come to life.

Adam: You mentioned the case studies they give you in being in interviews and you're bringing back and I don't want to save their memories or nightmares. But I definitely had a few of those. And I can tell you that when I was interviewing for Bain, and they were giving me case studies, there was not a case study that was anything like what you experienced, leading ClassPass in 2020, the highs and the lows. I'm gonna explain what happened to listeners. ClassPass raises $285 million at a $1 billion valuation. This is in January of 2020. March of 2020. Not all that much longer after the world is in crisis. The world of fitness is in crisis. Your business is in crisis. By April, more than half of your company is either laid off or furloughed. They don't teach you how to address that in business school. They don't teach you how to address that. When you're working for Bain, I didn't work for Bain, but I can tell listeners, they don't teach you how to address that period, right? I was an avid user of ClassPass. For years, we were chatting about this off the air, and I was in crisis, trying to figure out how I was going to be able to work out. So I can only imagine how you were feeling watching this company that you built with a billion-dollar valuation going through what is going through. What were the best lessons you learned from that period? And what advice do you have for leaders on how to lead through uncertainty, change, and crisis?

Payal: So few points there, I would start with the fact that the ClassPass team's DNA had always been about this iteration pivoting, right? We had changed our model multiple times; we knew how to quickly do that. So one of the first things we did is we flipped our entire product within a week into a video platform. Whether it was the right thing to do and it was the right content, we didn't even know; we just knew we needed to do the flip, right? Because we wanted to keep people somewhat engaged in working out to the extent we can. We didn't know how long this was going to last. And so we just said, ”Okay, our mission is still to keep people moving. How do we do that? Our second part of it really went to our studios; how do we keep them alive?”. That’s the magic of our product. While yes, we built a great platform; there’s still these studios, and many of them had fixed cost businesses, had employees that they had, and they literally were shutting down by the dozens, daily. It was really a hard time for us to watch. And we went and did a lot of things, whether it was doing government petitions, helping out with revenue subsidies where we could to help our studios because we knew that the lifeline of our product really comes down to the industry surviving. So I think, you know, those were our initial minds when we had to do what was right for the business. We knew after, you know, this is kind of coming and going, that we were just going to be living in this uncertain phase. Do we 100% believe the world we'll get to the other side of this, and people will go back to Studio fitness at some point? Yeah, and all of the data showed that as well. I think what we project and there will be a hybrid situation on the other end. But you know, I think part of why the Mindbody acquisition even happened, and I think these two great companies were finally able to come together as we knew that putting both of our efforts to help this industry recover on the other side, was going to be most beneficial to the industry. So you know, I think it's really about making decisions for us that we knew were going to help the future of the industry. I think that's really where our heart went to, versus, oh my God and not just shutting down. I mean, thankfully, we had raised enough capital, we had to do what was right for us. But it was about moving fast, and then doing, you know, strict strategizing constantly about what's going to be best for the future. But, you know, on a personal level, the only other thing I would say is, it was a time where I think everyone just needed a lot of empathy, right? You asked what it's like to be a leader during that time. And I think you just need to have a lot of empathy. And I mean, it's funny, because you talked about January and March, I mean, I also had a baby on January 29 that same year. So it was just a really crazy time because there was so much moving around in our lives. I think it just taught me how to just really roll again with the different punches we were getting. And I also felt we'd been here before. And I think the team had felt that too, because we knew how to move quickly. And I would say that for any entrepreneur out there is, the quicker you can learn to pivot, the less you know, and these shocks to your system are going to become a detriment.

Adam: So much great advice. Starting off with not panicking, making data-driven decisions, take a step back, absorb all the data that you have, and make informed decisions. Recognize that you're in a crisis right now. But the crisis doesn't have to be the end game. If you can weather the crisis, you can live another day. And what I love that you shared with listeners was the mindset that at the end of the day, we are going to get through this. And once we get through this, we have to build a business that's going to be successful on the other side. So pivot, play the long game, look beyond the crisis. And one last thing you said, the importance of empathy, whether you're leading in a crisis or leading in times that are good, empathy is imperative to be successful as a leader. In your experience, what are the key characteristics of an effective leader and what can anyone listening do to become a better leader?

Payal: I would say it has to start with having a clear direction, right? I think one of the things I know I have always been able to do throughout my life, and this starts from leading organizations in college to now is, when I truly believe in something, I find a way to just get other people to say, “I'm in, that sounds amazing”. And I think it truly happens because I am leading from a place of purpose, and a place of impact. I am not leading from a place of “Join my company, and you're going to become rich.”, right? Like, that's not where I'm leading from. And people want to be a part of a movement and a feeling. And I think that is an important thing to learn, how to have, and convey to your employees. So I think that's sort of step one. Step two, and or trade two I would say is, you know, something I have learned and I think maybe because in a weird way, I think people always underestimated me. I am a petite human being. And I think I always felt underestimated in every situation I was in and I have learned to let people sort of fly on their own. And whether it's giving them too much responsibility from the beginning, I almost like doing that, because I like to see where someone else's limits are without me telling them. And I think that's really helped me hire and have incredible people who literally started, you know, a class with us when they were in customer service who've gone on to literally lodge entire continents for the company. And I think that was because I never told them, “Okay, you need to sit in this box of what your role is”, right? And I think that is something an effective leader also has to do is be able to have that. And then I think the third thing I would say is, you want to know your strengths and weaknesses and be very self-aware. I think that is sometimes the hardest part. We all have egos, we don't want to feel like we're bad at anything. But I think you really need to be self-aware about what you're good at. I think we, you know, a lot of times leaders are the people who end up getting in the way of their company's growth or their company's success. And I think you have to know when to say, “Okay, like, I think you're better at this, please do this, I'm going to be in the role that I know I'm uniquely fit to do”. And I think those discussions and decisions are obviously very hard. But I think the more self-aware you are, and realize it's not about anyone telling you that you're not good at something, the magic of companies is everyone doing the thing that they are best at and moving forward together.

Adam: I could not agree with you more. And it's a key theme of this conversation. Something that I tell audiences all the time is, I'm a big believer that we're all bad at most things in life. I think if we're honest with ourselves, if we are truly reflective, we can acknowledge that we're probably bad at most things. But we're good at a few things. And we all have that one thing that we're great at, that one thing that we're exceptional at, our superpower. And the more quickly you could figure out what it is that makes you special, what it is that makes you unique, what it is that makes you different, the more successful you'll be in life, the more successful you'll be in business, and the more successful you'll be as a leader. It starts with getting on that journey of self-discovery. And having the self-awareness to first and foremost want to get on the journey of self-discovery. And secondly, having the ability to be introspective, and understand who you are, go out, talk to people, ask the right questions, listen, figure out, what do I do? Well, what do I not do? Well, and tying it back to what we spoke about earlier, surround yourself with people who compliment you in the areas that you're not great at so that you can spend your time focused on what you do so well. 

Payal Kadakia: Yes, absolutely.

Adam: You're an entrepreneur, you're a wife, you're a mom, you're also the creative director of Indian Dance Company. So, you have a lot on your plate. How can anyone listening to this conversation, optimize their day, optimize their time, and to the extent it's possible, find balance?

Payal Kadakia: This is my favorite topic. I think about things I have done right my in my life and things I know how to do and this is one of the things I think I have always been good at. Because here's where it starts. I have always been very clear about my priorities. And this started way before being, you know, an entrepreneur. This started with figuring out how I manage my homework and how I get to the thing I love, which was dancing. And I started this sort of process of optimizing my day. Since I was very young. I've always been very thoughtful about my time because it is the most important resource we have. And it really comes down to not letting other people's idea of how I should live dictate mine. It's me coming up with my priorities. So I have a few tips for people. One of the things I do every Sunday night is, I write down what I call my Sunday night weekly priorities. And these go across my whole life, whether it's personal or professional. And only after I write down what I think my priorities are, I look at my calendar, right? Because most of the time, our calendars are full of a lot of stuff. Sometimes they serve what we want to accomplish, and sometimes they don't. And I think I have learned with what my second thing is, I don't feel guilty about saying no to the things that don't really serve what I really want to accomplish, because I know what my priorities are, and they're serving my intention, my impact, and what I want to move forward in. So I really think that's the second part of it. And you know, the last part of it, and this is a bigger conversation but, it's actually what my book is about, is goal setting. And I've come up with a whole process. It's sort of this quarterly process I do every single year, you know, and it really comes down to starting with intention going on and moving into really knowing where to focus your time for the next few months, setting really tangible, practical goals, because at the end of the day, if they're not things you can actually get done, you're never going to do them. And that's how I've been able to move forward in my life. And I don't get stuck, because to me, like even every three months, it gives me an opportunity to be somebody new, to try something else, and not get stuck, because that's usually how we fail the most.

Adam: I’d like to ask you one last question before we go. We spoke earlier about the importance of having a definition of success. We spoke earlier about how to discover your definition of success. What can anyone listening to this conversation do to become more successful personally and professionally?

Payal Kadakia: I think the first thing you really need to do is understand your “why”. Why do you do all the things that you're doing in your work? What are the external forces that are potentially pushing you? Is it being led by things like greed or power or fame? Or is it being led by love, passion and purpose? And I think that's where you really have to start, because if you want to make a shift in your life, you really should be going towards love, passion, and purpose and it will always lead you to a better place. You don't want to end up later in your life regretting that you made a decision, you know, to chase something else and realize that it wasn’t fulfilling. A fulfilled life will always trump anything else.

Adam: I love it. Thank you for all the great advice and thank you for being a part of Thirty Minute Mentors.

Payal Kadakia: Thank you for having me.


Adam Mendler is the CEO of The Veloz Group, where he co-founded and oversees ventures across a wide variety of industries. Adam is also the creator and host of the business and leadership podcast Thirty Minute Mentors, where he goes one on one with America's most successful people - Fortune 500 CEOs, founders of household name companies, Hall of Fame and Olympic gold medal winning athletes, political and military leaders - for intimate half-hour conversations each week. Adam has written extensively on leadership, management, entrepreneurship, marketing and sales, having authored over 70 articles published in major media outlets including Forbes, Inc. and HuffPost, and has conducted more than 500 one on one interviews with America’s top leaders through his collective media projects. A top leadership speaker, Adam draws upon his insights building and leading businesses and interviewing hundreds of America's top leaders as a top keynote speaker to businesses, universities and non-profit organizations.

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