It’s the classic entrepreneurial success story: a software firm that started in its co-founder’s garage last decade is now a $139 million publicly traded company, with revenues growing fast and an app that reaches millions worldwide. Already the leading booking and payments software solution in the yoga studio and wellness space, MINDBODY, Inc went public in June 2015, raising more than $100 million. Lately, it’s making a bid for consumer attention as well, including via a partnership with Google to display classes and services at MINDBODY client studios in search and map results.
We spoke with co-founders Rick Stollmeyer (the CEO) and Blake Beltram (whose current title is “evangelist”) to get the story of how the company got started, its core values, and how mindfulness and consciousness have played roles in its success.
- Location: San Luis Obispo, CA
- Founded: 2001
- Number of Employees: 1,400+
- Traction: Provides digital scheduling and other online tools for 60,000+ fitness studios worldwide
- Structure: Public for-profit (NASDAQ: MB)
- Certifications: Great Place to Work Certified
- 2016 Revenue: $139 million, a 37% increase year over year
- Mission statement: “Leveraging technology to improve the wellness of the world.”
What’s the story of how you guys got to where you are today?
Blake Beltram: In the summer of 1998, I bought a $64 book on how to make software. With one Pilates client, I started making software for boutique fitness studios. That led to co-founding MINDBODY Software with one of my oldest and best friends from high school, Rick Stollmeyer, who’s still the CEO of the company today, and who asked me to come back to the company in 2013 after a 10-year absence.
Rick Stollmeyer: Blake and I shared the background of small business. His mom was an entrepreneur —started a business in her living room. My dad and my grandfather, three of my four brothers, all started their own businesses.
We had this tradition of meeting on State Street [in Santa Barbara] because it was halfway between his house and mine. One time he brought a laptop because he really wanted to show me this software application he had created. I’d love to say that I had this “bolt of lightning” experience, but I didn’t. My first question was, “Yoga’s a business?” I’m fairly certain I called Pilates “pielots.” I knew nothing about software. People were like, “Well, were you into yoga?” No. “You’re a software guy?” No.
What Blake proceeded to open my eyes to was this wonderful, proliferating world of boutique wellness studios that was emerging in Los Angeles, San Francisco, and New York, primarily. What they were doing was much more personal, hands-on, and transformational than gyms or health clubs. It was about creating community on a hyper-local scale, and simultaneously, these people were connected globally.
At the time I was deeply dissatisfied with my own career. I thought I just wasn’t cut out for business, because I didn’t like the people, and I didn’t like what I was being compelled to do to earn my dollar. I was working on a graduate degree so I could be a lecturer at Cal Poly university. I never finished that graduate degree because, instead, I just chucked the whole thing and threw in with Blake in the fall of 2000.
BB: Right, with my 17 clients, or whatever it was, and no benefits, no investment, no capital to speak of. In fact, Rick took out a second mortgage on his house to fund the privilege of coming to work there.
RS: I did. Before I quit my job. Very important step: don’t ever quit your job before you get that business loan. This was in the middle of the dot-com bomb. Being born in that environment was beneficial in the long run for the business. One thing Blake and I share is a deep inner cheapness; we don’t waste money. Running this business out of his kitchen in Glendale and my garage in San Luis Obispo worked beautifully for quite a long time.
BB: To think this is a man who had three kids, a good-paying job with benefits, a wife, and a mortgage, and he took a second one out on his house, set up a desk in the corner of his garage — which became the world headquarters — rolled up his sleeves, and went to work to build the company.
RS: When I packed up my laptop and started calling on his businesses, I just fell in love with them. I found these wonderful, daring people who were leaving the relative safety of a job, borrowing money from friends and family, signing leases, building out spaces, and hanging up their shingles. I felt the connection to my own family’s background. And the magic of combining that spirit with a business whose intention is to spread wellness, I thought was just miraculous.
BB: I watched Rick go through that transformation close-up, and it was quite a miraculous thing to see. He had gone to the Naval Academy after high school. I was a theater, film, and television major. I had been exposed more to our clients and that crowd, but I watched Rick go into these businesses and fall in love with what these people were doing and what they were about. I saw it change him — or, probably, more appropriately, bring out who he really was.
RS: The very first client I personally on-boarded was Yoga Garden in San Anselmo, up in Marin County. I spent two days with these ladies. Half the time I had to get Blake on a speaker phone because I didn’t know the answers to any of their questions, and barely knew the software.
I ended up taking classes. There was a massage therapist operating down the hall, and I got a massage where she tuned my chakras. I remember jumping in my Dodge Neon and driving across the Golden Gate Bridge. This was a deluxe Neon with a sunroof, which I had open. I was playing some great tunes and it was one of those impossibly gorgeous days in San Francisco, and I felt truly alive and so thankful. I called [Blake] when I was driving across that bridge and said thank you, because I was just so joyous. I had no idea how we were ever going to make any money at this, but I knew it was going to be sheer joy.
That heart has propelled us through the years. Any time I’m having a hard day, I just re-center on our clients. They’re beautiful people on the inside and out.
If you were giving advice to the next Rick and Blake, what you would want to pass on about courage, discipline, and heart when it comes to a business?
BB: I would turn that upside down and say heart is first and foremost. Rick and I were both compelled by some force driving us to this. For both of us, it took a certain amount of surrender to something we were feeling called towards. Courage was a part of it, but surrender came even before courage.
RS: I agree. We have three forms of intelligence — our head, our heart, and our gut. All three have to be fully engaged to make the best decisions in life. When we do that, there’s an invisible hand that pushes us along.
It didn’t feel like a courageous act to me at the time. It felt like the only thing I could do. The alternative was intolerable. When the universe knocks at your door, you can ignore it. Later, it’ll knock again, and harder, and you could still choose to ignore it. If you keep ignoring it, at some point it just tears the frickin’ house down. If you are not listening to that still, small voice, it will become a very loud noise.
My prior job went from being uncomfortable to unhappy to intolerable right when you were showing me this. When you first showed it to me, you weren’t looking for me to join you. In fact, your comment was, “I’m looking for a partner. Do you know anybody?” I was like, “Well, why not me?”
BB: Maybe this is a good time to reveal that I actually did want you. I didn’t have the guts to ask him to leave his good, paying job, with benefits, with everything he had going, so instead I asked him if he would help me find a business partner.
You built this company, you went public, and you guys are running at light-speed now trying to grow the organization. When you’re going through all this, what is the role of greater spirit or mindfulness as a leader?
RS: I look at the vision of the company as the North Star. Is what we’re doing in this moment, in this action, taking us closer to that goal? If it isn’t, we need to change course. If it is, then we need to double down.
What are your own personal core values that keep you heading to your true north?
RS: My personal core values are the company’s core values: that there is some purpose greater than ourselves, that it’s more than making money. That’s foundational. Then: “humble and helpful.” “Caring and happy.” That’s this approach to life that simply says these are the people who play well with others. These are people I’d rather be around. “Environmentally-conscious.” “Committed to wellness.” That last one is a hardcore value, because it means we have to walk the talk. “Conscious leadership.” We summarize that as the five Cs: competence, character, compassion, being a catalyst, and acting with courage. And “Continuously evolving.” By the way, none of these values are soft, fuzzy things. These require courage. They require hard work.
I wrote the first draft of those core values on a flight home from the Inc. 500 Conference the first time we were on the list. [Zappos’ CEO] Tony Hsieh had said, “If your core values aren’t written down, if they’re not actionable, if you won’t hire, promote, train, develop, and fire people on core values, then they don’t mean anything. They’re just words on a page.”
I started asking myself what’s most important, those things I found to be truths, that work in my life. Who are the people I’ve worked with who have done well at MINDBODY, what traits do they have? That came down to the seven core values. I distributed them to a couple dozen people at the company. We tweaked a bit around the edges, but the original seven is close to what I wrote on the piece of paper on that plane. You start with a purpose greater than yourself, and you end with a commitment to never stop growing.
Talk to me about a “holy crap!” moment, and how you used your practice of staying conscious or mindful to get through that.
RS: It hasn’t happened much lately, but back in the earlier days, outages were quite common, because what we were doing was breakthrough, so the software was simply failing. Those moments are very, very stressful. When our system fails, everything at [our clients’] business stops. They call us and crash our phone lines because they want to make sure we know the system is down.
In those moments, I go back to my center: we are here to help other people. We are here to leverage technology and improve wellness. If we get into that “holy crap” place in our own heads, we’re not walking the talk. We need to have empathy for our customers and understand that they’re frustrated and angry in that moment, and our job is to help them get through that.
What also helps is my military service. In military service, somebody’s going to die. Nobody’s dying here. They’re going to be okay. So just putting it in perspective.
How do you build the capacity to have that perspective?
RS: I have an almost daily meditation practice. I say “almost” because I do miss it some days. Meditation teaches me what it’s like to have the mind quiet, and so I can usually draw that out in any situation. I can quiet myself and be present, be here and now, the Eckhart Tolle philosophy: this is the only reality right now, so why would your mind be somewhere else? This is where it should be, because this is our only reality. The future hasn’t happened yet. Easy to say….
On a deeper level, I’ve been knocked down a lot in my life. One of the beauties of growing older is that you gain perspective.
BB: In those moments, it comes to our individual core values. I’ve got to have a foundation to come back to. That foundation can be a religion, it can be a spirituality, or it can just be taking a breath and finding that sense of being completely present. Rick is uniquely gifted at it, I have to say. He tends to be very present with whoever he’s with. That’s a comment I’ve heard about him often. In that moment, they’re the only person in the world, and that’s an important quality of a leader.
RS: It’s intentional. I’ve worked to develop that. It’s not natural.
How do values and intentionality play a role in leadership?
RS: A leader must first know themselves. We are all unique individuals. Going deep into knowing yourself is important work we all need to do individually — knowing what you stand for, what matters in your life, what you want your life to be about, what you want people to say about you when you’re gone.
The end-point in that for a leader is to get yourself out of the way. The way to be present with someone is to get out of your own head, and to practice curiosity to truly love everyone, even the people you don’t like.
Give me a quick sense of company culture at MINDBODY.
BB: First of all, to be clear, I left for 10 years, so Rick was the one who built the company and the culture while I was gone. I think our core values, “humble and helpful” and “caring and happy,” are a good way to sum up the personality of the culture here.
RS: If we go back a few years, I think we had successfully attracted and conveyed the softer, fuzzy elements of the culture and underplayed the harder, more challenging aspects of it. To the degree where ultimately it ends up being damaging.
Let me give you an example: [if there are] people on our software development team who aren’t really focused on what the customer needs and aren’t fully committed to solving their customer pain points. In their own group, they’re enjoying a lot of creative freedom, time to go take that yoga class and throw a Frisbee out in the plaza, and working 7.2 hours a day but calling it 8. Meanwhile, look at the pain it’s causing those business owners who aren’t getting their issues resolved — the bugs being fixed or the feature gaps being closed.
One of my deepest opportunities and challenges over the last two years has been to convey that these core values also mean purpose-driven, and a deep commitment, and caring. They imply a level of personal integrity that would not be comfortable knowing that other people are suffering because I’m taking it easy. Most people who were in that category made a pretty dramatic turnaround, and some people just had to go.
Talk to me about your philosophy on community.
RS: It has to start with a spirit of win–win. We believe that we win together. We win together with our clients, with our team, and with our community. We win together with our investors, with the owners of the company. If the business is ignoring any of those stakeholders, something is going to go afoul.
What’s giving you hope for the future?
BB: I’ve never seen people more engaged or more active than they are right now. I’m extremely optimistic, because I feel like we’re deciding who we are — individually, as companies, as a nation. I might say as a species. That decision might have been more in the background before, but now it’s right in our face, and we’re all being asked to choose: who are we?
The clients I talk to, people who are really tuned in to the deeper level of what’s going on, they’re still optimistic, because they feel like millions of us are going to make the choice to show up as the best version of ourselves. Ultimately, we are going to create a better world to live in. Is it going to be a little bit painful and a little bit ugly? Most likely, but usually transformation is a little bit painful and a little bit ugly.
RS: There’s also introspection going on in Silicon Valley. The companies there are used to being the good guys, and now the right question’s being asked: “Are we being the good guys?” If Uber is accelerating the advent of driverless cars, where are [current Uber drivers] going to go work? You just created a whole new category of job and now you’re hell-bent on eliminating that job. The “ideal” tech company has 12 employees generating a billion dollars in revenue, putting a million people out of work. That seems to be what everybody dreams of, up ’til now. That’s part of the energy that fueled Donald Trump, and we need to be listening to that. I see that changing.
One thing I’m really, really proud of MINDBODY for is that we create jobs. Not just the jobs of our own team members, but the jobs of all of those businesses we’re helping to make sustainable. As we look at technological advances, we are going to do everything we can to continue that.
Aaron Kahlow has built five companies over two decades and is now putting his entrepreneurial skills to work for the great consciousness movement. His teachings, advising, and the space he creates is paving the way toward a more accessible, modern mindfulness approach to life, one that leads to our greatest human need: a connection that grounds our being, aligns our energy, and gives a greater sense of meaning and purpose.
In his role at ConsciousCircles.org, Kahlow is creating “conscious circles” around the world for leaders, entrepreneurs, and others trying to find their way through life’s big transitions. His circles focus on getting clarity of true self by cultivating a trusted space for our souls to be revealed and human wholeness to be found.
Many know Kahlow for his leadership roles at Conscious Company Media, the Conscious Company Leaders Forum, the Conscious Business World Summit, the Mindful Order of Being, and the Conscious Directory Project. He is also a syndicated columnist, passionate motivator, and globally renowned speaker. In addition to his articles published by Conscious Company, you can find more interviews and thought leadership pieces here.
Rachel is Conscious Company’s former editor-in-chief. Before joining the CCM team, she worked at Backpacker and Wired magazines.