ClassPass
ClassPass is an American subscription-based platform founded in 2013 by Payal Kadakia that enables users to access fitness classes, gym workouts, and wellness services at partner studios and facilities worldwide through a monthly credit allocation system, where credits are redeemed for bookings rather than fixed dollar values.[1][2] The service operates on a revenue model of tiered subscriptions ranging from approximately $15 to $199 per month, providing varying credit amounts that incentivize frequent but flexible usage across diverse activities like yoga, barre, cycling, and spa treatments.[3] Initially launched in New York City as a response to fragmented class bookings, it expanded globally, achieving unicorn status in January 2020 with a $1 billion valuation after raising over $285 million in funding from investors including Temasek and Wellington Management.[4] In October 2021, ClassPass was acquired by Mindbody, a software provider for the wellness industry, in a deal that integrated its booking network with Mindbody's studio management tools to enhance partner revenue streams and user discovery.[1] The platform has grown to encompass thousands of partners, reporting a 44% year-over-year increase in reservations as of May 2025, while diversifying beyond traditional fitness into salons, spas, and experiential offerings like hotel wellness packages and even movie theater integrations.[5][6] Despite its scale, ClassPass has faced notable tensions with studio owners, who have criticized its dynamic pricing and per-class payouts—often negotiated below standard rates—as creating financial dependency and devaluing services, with some alleging the model prioritizes platform growth over partner sustainability.[7][8] These issues have prompted lawsuits, including a 2025 class action challenging the expiration of unused credits within 30 days as potentially violating consumer protection laws by effectively forfeiting user value.[9] Nonetheless, empirical data from partners indicate net positives for occupancy in underutilized slots, underscoring the platform's role in democratizing access amid varying studio capacities.[10]History
Founding and Initial Launch (2013)
ClassPass was founded by Payal Kadakia in New York City in 2013, stemming from her frustration with the fragmented process of discovering and booking boutique fitness classes. A classically trained dancer who had previously worked in consumer internet at Goldman Sachs, Kadakia conceived the platform after a failed online search for a specific ballet class, which highlighted the lack of a centralized booking system akin to OpenTable for restaurants.[11][12] This personal catalyst built on her earlier venture, Classtivity, launched in 2012 through the TechStars NYC incubator as a search engine for dance and fitness classes, which failed to gain traction due to low conversion rates from discovery to bookings.[13] In early 2013, Kadakia pivoted Classtivity toward a subscription model called the "Passport," offering $49 for 10 classes across studios in eight cities, including New York, to encourage actual attendance over mere browsing.[14] By June 2013, this evolved into the full launch of ClassPass in New York City, rebranded and refined as a $99 monthly subscription granting access to 10 classes at partner gyms and studios, with the platform securing discounted bulk rates from providers to enable variety without per-class pricing.[13][14] The initial model emphasized user flexibility to sample diverse workouts—yoga, cycling, dance—while filling unsold studio capacity, positioning ClassPass as an aggregator in the boutique fitness market dominated by single-studio memberships.[4] At launch, ClassPass operated exclusively in New York, partnering with local studios to build its network, and quickly demonstrated early product-market fit through organic word-of-mouth among fitness enthusiasts seeking alternatives to rigid gym commitments.[14] Kadakia served as CEO, driving the pivot with a small team, including early technical contributions from partners like Sanjiv Sanghavi, though she remained the visionary lead.[4] The service's debut subscription structure laid the foundation for its marketplace approach, prioritizing user retention via class credits over unlimited access to avoid overutilization issues observed in precursors.[14]Growth and Challenges (2014–2020)
ClassPass experienced rapid expansion following its 2013 launch in New York City, raising $2 million in seed funding in March 2014 to support initial scaling.[7] The company subsequently secured a Series A round of $12 million, followed by multiple later-stage investments, including $70 million in June 2017 and $85 million in Series D funding in July 2018.[15] By mid-2015, ClassPass had grown to partnerships with over 7,000 studios across 36 cities on three continents, driven by its subscription model that allowed unlimited class bookings for a flat monthly fee.[16] This period saw aggressive geographic rollout, with launches in 10 additional U.S. and Canadian cities announced in August 2017, including Cincinnati, Calgary, and Honolulu shortly thereafter.[17] International growth accelerated, reaching 28 countries by early 2020, bolstered by a $285 million Series E round in January 2020 that valued the company at over $1 billion.[4] Despite this momentum, ClassPass faced sustainability issues stemming from its original unlimited-access model, which encouraged overbooking and strained studio capacities while paying partners fixed low per-class rates regardless of demand.[18] Studios increasingly criticized the platform for undercutting their full-price offerings, opaque algorithmic pricing that reduced payouts over time, and dependency on investor funding to subsidize losses from customer discounts exceeding studio revenues.[7] To address these imbalances, ClassPass transitioned to a credit-based system in March 2018, where users purchased monthly allotments (e.g., $135 for 90 credits, sufficient for 8-12 classes) that varied by studio and class type, allowing rollover of up to 10 unused credits and add-on purchases.[19] This shift aimed to align costs with usage but drew user backlash over perceived hikes in effective pricing for popular classes and further eroded trust among some studio owners, who reported per-student payments dropping as low as unsustainable levels.[18] The onset of the COVID-19 pandemic in early 2020 exacerbated operational challenges, with government-mandated closures of gyms and studios across major markets like California beginning in March, halting in-person bookings and prompting refunds or credits for affected memberships.[20] ClassPass, reliant on physical class attendance, saw revenue plummet amid widespread industry shutdowns, though it had achieved unicorn status just weeks prior via its latest funding.[21] These events highlighted vulnerabilities in the marketplace model, including heavy dependence on boutique studio partnerships susceptible to external disruptions and ongoing tensions over revenue sharing that persisted despite pricing adjustments.[22]Acquisition by Mindbody and Leadership Transition (2021)
On October 13, 2021, Mindbody, a provider of business management software for wellness businesses, announced its acquisition of ClassPass in an all-stock transaction, with financial terms undisclosed.[23][24] The deal integrated the companies' teams while allowing ClassPass to maintain its app and website operations, aiming to merge Mindbody's backend tools for studios with ClassPass's consumer subscription platform for class bookings.[25][26] Concurrently, Mindbody secured a $500 million strategic investment from Sixth Street and Vista Equity Partners to support the combined entity's growth in the fitness and wellness sector.[23][27] The acquisition closed on October 15, 2021, positioning the merged company to leverage ClassPass's user base—previously valued at over $1 billion in early 2020—for enhanced discovery and booking capabilities amid post-pandemic recovery in fitness services.[28][29] Mindbody's CEO Josh McCarter emphasized the strategic fit, noting the combination would create a comprehensive platform connecting consumers, studios, and wellness providers more efficiently.[23] In tandem with the deal, ClassPass underwent a leadership transition as founder Payal Kadakia, who had served as CEO since the company's 2013 inception, stepped away from day-to-day operations to focus on her passion for dance and other ventures.[30] Kadakia shifted to an executive chairman role initially but ultimately transitioned out, entrusting leadership to the integrated ClassPass and Mindbody teams.[31] This change reflected the post-acquisition emphasis on operational continuity under Mindbody's oversight, with no immediate external CEO appointment specified for ClassPass at the time.[30][24]Post-Acquisition Developments (2022–2025)
In August 2022, Mindbody announced executive leadership changes, appointing Fritz Lanman, previously ClassPass CEO and post-acquisition President of ClassPass and Mindbody Marketplace, as Mindbody's new CEO effective September 3, 2022; he succeeded Josh McCarter, who transitioned to the board of directors.[32][33] This move integrated ClassPass's consumer-facing operations more deeply with Mindbody's business management software, aiming to enhance synergies in the fitness and wellness sector.[34] ClassPass reported substantial booking growth under Mindbody's ownership, with fitness reservations increasing 200% in 2022 compared to the prior year, driven by popular classes such as bootcamp, indoor cycling, and high-intensity interval training.[35] In 2023, overall sports and recreation bookings rose 92% from 2022 levels, with golf emerging as the fastest-growing workout category.[36] By 2024, ClassPass expanded into food and beverage offerings alongside traditional fitness, reflecting a shift toward holistic wellness experiences.[37] In May 2025, ClassPass recorded a 44% year-over-year increase in wellness-related bookings, underscoring its evolution into a broader platform for non-gym activities like spas, salons, and recreational pursuits.[5] On June 4, 2025, Mindbody, ClassPass, and Booker unified under a new parent brand, Playlist Technologies, to streamline operations and position the combined entity for potential sale amid industry consolidation.[38] Later that year, ClassPass updated its terms effective January 2025, removing per-studio user limits to boost accessibility, though some studios expressed concerns over potential overcrowding.[39] Mindbody's 2025 State of the Industry Report highlighted industry-wide optimism, with ClassPass contributing data on rising wellness trends.[40]Business Model
Subscription and Credit System
ClassPass employs a monthly subscription model in which members purchase tiered plans granting a predetermined allotment of credits, which are redeemed to reserve fitness classes, wellness appointments, or experiences at partnered studios and facilities. Credits function as a flexible currency within the platform, enabling users to curate personalized routines across diverse offerings such as yoga, barre, cycling, or spa services, rather than committing to fixed class types. This system supplanted earlier unlimited access models to mitigate studio overcrowding and revenue dilution, with credits introduced around 2017 to balance user volume and partner sustainability.[41][42] The number of credits required for a booking is determined algorithmically, factoring in variables like studio demand, class popularity, instructor draw, booking lead time, and geographic market saturation. Less sought-after sessions at boutique venues typically deduct 3–4 credits, while high-demand peak-hour classes at flagship locations can consume 10–13 or more credits; reserving earlier in the booking window often incurs fewer credits to incentivize advance planning. Users receive notifications of credit costs upon selection, and plans auto-renew monthly at midnight on the subscription anniversary, with unused credits expiring without rollover to prevent hoarding and align incentives with consistent usage.[41][43][44] Subscription pricing scales with credit volume and varies by locality to reflect regional studio densities and costs, with base U.S. tiers as of 2025 including 8 credits for $19, 15 credits for $35, 28 credits for $59, 38 credits for $79, 68 credits for $139, and up to 125 credits for approximately $249. Higher tiers offer better per-credit value, accommodating frequent users aiming for 8–12 classes monthly, though actual bookings depend on credit efficiency and availability. Members can upgrade, downgrade, pause, or cancel plans via the app, subject to prorated adjustments, but no refunds apply to expired credits.[45][46]| Plan Credits | Monthly Price (USD) | Approximate Classes |
|---|---|---|
| 8 | $19 | Up to 3 |
| 15 | $35 | Up to 5 |
| 28 | $59 | Up to 8–10 |
| 38 | $79 | Up to 10–12 |
| 68 | $139 | Up to 15–20 |
| 125 | ~$249 | Up to 25+ |