The Amazing Story of ClassPass - Building a Subscription-Based Fitness Empire

Today on Life By Design 360, we’re diving into the incredible journey of Payal Kadakia, the founder of ClassPass—a company that went from a tiny New York startup to a global brand with millions of users.

Her story has it all—creativity, resilience, tough business pivots, and a level of determination that will make you rethink your own limits.

And here’s the thing—her journey started because she was bored with her workouts.

Today, we’re diving into a story that’s equal parts innovation, resilience, and adaptability

From a small membership-based business in the fitness industry to becoming a global brand used by millions, Payal’s path offers powerful lessons for anyone dreaming of building something impactful. Whether you’re starting out after a layoff, pivoting in your career, or simply curious about how game-changing companies are built, you’re going to love this one.

Like many great business ideas, ClassPass began with frustration—Payal’s frustration, to be exact.

Picture this: you’re someone who loves staying active and trying different workouts, but your routine has become stale. You’ve been going to the same gym, doing the same exercises, surrounded by the same scenery, and you’re losing motivation. That was Payal’s reality.

She wanted variety. She wanted to explore dance, yoga, Pilates, spin classes, and more. But she found that accessing a variety of fitness options required either multiple expensive memberships or a ton of one-off class fees. It was inconvenient, and it limited people’s ability to stay consistent with their fitness goals.

That’s when the idea began to form.

In 2013, Payal launched ClassPass—a single membership that opened the door to hundreds of fitness studios. One monthly fee, countless options.

Her vision was simple yet powerful: break the boundaries of the single-gym model and give people the freedom to experience different workouts on their terms.

And let’s not forget—Payal didn’t come from a tech startup background. She was a dancer and an entrepreneur at heart, and she was solving a problem she deeply understood. That personal connection to the mission would be one of the key drivers of ClassPass’s early success.

ClassPass started small in New York City. But the magic was in the model. Payal created something that appealed to two very different groups at the same time—fitness studios and fitness enthusiasts.

For studios, ClassPass helped fill empty spots in classes during off-peak hours, bringing in new faces who might become regular customers. For users, it was like having a fitness buffet at your fingertips—yoga one day, boxing the next, barre the day after.

It was a win-win, and it spread fast.

By 2015—just two years in—ClassPass had expanded to over 40 cities across the United States.

But scaling at that speed isn’t easy. One of the secrets to this growth was strategic partnerships. Payal and her team focused on building strong, trust-based relationships with boutique studios.

They also invested heavily in user experience. The ClassPass app wasn’t just functional—it was designed to make exploring new fitness options exciting and frictionless.

Of course, there were challenges. With rapid expansion came the question every scaling business faces: How do you grow while staying profitable?

Some studios began worrying that the ClassPass model might cannibalize their own membership sales. There were concerns about pricing, customer churn, and whether the exposure truly translated into long-term customers for them.

This was the first big hurdle for Payal—maintaining the delicate balance between delivering value for users and keeping partner studios happy.

Every company that scales fast eventually hits turbulence. For ClassPass, those headwinds came in the form of criticism from studio owners and changes in the broader fitness market.

Payal could have stuck to her original business model and hoped the complaints would blow over. But that’s not how resilient entrepreneurs operate.

In 2018, ClassPass made a bold move—transitioning to a credit-based system.

Here’s how it worked: instead of paying for unlimited classes each month, members bought credits, and different classes “cost” different amounts of credits based on popularity, location, and time.

This change gave studios more control over their pricing and helped ClassPass better match supply with demand. It also created a more predictable revenue stream for both the company and the studios.

But implementing this shift wasn’t easy. Payal and her team had to communicate the benefits clearly to both users and studio partners. There was pushback, as there always is when a familiar model changes, but in time, the credit system proved to be more sustainable.

Behind the scenes, ClassPass also doubled down on technology—improving the app interface, personalizing class recommendations, and providing studios with detailed analytics about customer behavior.

The lesson here? Flexibility isn’t just about your product—it’s about your mindset. Payal didn’t view change as a setback; she treated it as an opportunity to build something stronger.

Fast forward to today, and ClassPass is far from the small NYC startup it once was. It’s now a global brand with more than 25 million users across multiple countries.

The company has been valued at over $500 million and generates more than $200 million in annual revenue.

Payal’s personal journey has transformed as well. From a dancer looking for more variety in her workouts to a tech entrepreneur recognized worldwide, she’s been featured on lists like Forbes 30 Under 30 and has an estimated net worth of around $50 million.

But what’s most impressive is that Payal didn’t build ClassPass to simply make money—she built it to solve a real problem that she experienced herself. That authenticity has been a cornerstone of the brand’s identity.

Even after stepping down as CEO, Payal has continued to inspire entrepreneurs through speaking engagements, mentorship, and her book, LifePass, where she shares lessons on balancing ambition with personal fulfillment.

What can we learn from Payal Kadakia’s journey—especially if you’re thinking about starting a subscription-based business or scaling a company of your own?

Here are a few of her most consistent pieces of advice:

If you’re building your own business, especially in a competitive space, Payal’s story is proof that resilience, adaptability, and customer focus can take you from an idea in your head to a brand recognized around the world.

Payal Kadakia’s journey shows us that entrepreneurship isn’t about having all the answers from day one—it’s about staying curious, staying committed, and being willing to evolve.

Remember, you don’t have to build a billion-dollar business, you only need to build your dream.

Whether that gets you by - very comfortably - to millions, - - or billions, your happiness is the key.

We hope you enjoyed today’s story. Maybe soon, I’ll be talking about your story.

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