How Peloton Built the Foundation for Enduring Success (A)

This case follows the experiences of Peloton Founder John Foley from concept creation in 2011 to large-scale success in 2020. Foley created his own playbook for a product whose category—"connected fitness"—he created from the ground up. Foley faced, and overcame, product design, technological, manufacturing, and financing challenges before arriving at a marketable stationary cycling product that connected virtually to instructors. Soulcycle and Flywheel, established in-person cycling studios, both rejected Foley's proposal to partner with his new venture. Along the way, Foley was turned down by 400 VC's before landing his first institutional investor after almost three years on the money hunt. But Foley persevered. At the end of FY 2020, Peloton had revenues in excess of $1.8 billion, earned $376 million in operating cash flow, served more than one million subscribers, sold bikes and treadmills in more than 100 stores in four countries, and delivered 175 million fitness classes through its global virtual network. This case brings students a close-up look at an entrepreneur's journey—and asks them to consider if the company's success will likely continue beyond 2020.