Mindbody CEO: Strategies for Operating During COVID-19
The wellness industry is reeling from the effects of the COVID-19 pandemic. Mindbody CEO Rick Stollmeyer opens up about its impact on his own business, and offers business owners some practical advice for succeeding in the COVID-19 era.
0:02 Hello, Mindbody customers.
0:04 I'd like to give you an update on things going on here at Mindbody, and also talk about some things that we're doing that should be very helpful to you.
0:14 You know, it's been barely a month since this whole crisis just turned our world upside down-and what an intense trying month it has been. You know, this has globally impacted every one of the 60,000 businesses currently running on Mindbody. We've seen it in every country, in every region. And in the midst of that, we've also seen a just amazing and inspiring set of actions by so many of you, who are absolutely determined to do the things necessary to see your businesses succeed. And that's why looking at this now after four weeks, I have to tell you, that I'm utterly convinced that this is going to make our industry even better.
1:02 We believe that people are going to be even more committed to their wellness activities, their wellness lifestyle, once they're allowed to go back out into the economy and visit your businesses. We've also seen a remarkable adoption of virtual wellness delivery. This is the data on our platform as of through Sunday. What you see on the left hand side are virtual class instances. And so up through last week, it's been increasing day by day, about 25,000 different virtual classes being held on our platform per day, and more than 200,000 attendees of those virtual classes.
1:45 And then on the right hand side, you see which of the different platforms they came through to access. And so out of this effort, and out of these results, we of course, double down on our own virtual wellness platform and that platform is something as I mentioned in my last email, or last email, my last video is something that we were already working on. And we decided to greatly expand with this effort.
2:13 So right now, the virtual wellness platform has been released on our on our site, and it's available free to all of you. It allows you to do your on demand video classes, as well as streaming video classes. And if you go to mindbodyonline.com you'll see quick click throughs to it, you'll be able to access it from your software, the streaming capability just released. And there's already more than 5000 businesses utilizing this to stay connected to their clients, their customers and their members.
2:48 I also wanted to talk with you a bit about the actions we're taking at Mindbody. As you may have heard, we furloughed or laid off about 700 people like last week. We have a global team of about 2000 prior to this, and when we looked at the depth of the impact to our customers in our market, we had to make the really difficult decision that we needed to reduce our operating expenses during this time. We first and foremost prioritized the continuation of our world class software and our service, the data security, the reliability, and the customer support that you folks need, particularly in this challenging time. And then second, we prioritized maintaining our our strong ability to innovate. We have, I think, the largest development team in the industry right now on our platform, and we have some very exciting things in development. And then we looked at across how we could serve customers in every region. And we did a complete ground up rebuild of how we staff the company, and how we serve you. And that resulted in a realization that we needed to learn off, or follow about 700. But I want to be clear that we didn't do this out of any act of desperation. It was in fact quite the opposite. We're being very proactive, we're being thoughtful about our long term future. And those are the kinds of decisions that each of you are having to make right now. Because this industry is going to come back. And as I said, in my last message, your number one priority right now is to make sure that you're conserving your cash and positioning yourself for the future.
4:29 Third, I wanted to talk about payment processing. You know, in times of crisis, the payment processors in general, become much more risk-averse. The risk to them is a merchant running a credit card, or debit card, or an auto pay transaction for a product or service that they're unable to deliver. And of course, when you think about our industry, well, that's one that payment processors would be really concerned about at this time. And we really have two concerns here. The first and foremost is protecting your businesses so that you can get the cash flow you need. Second, we also have to be mindful of real risk, and any kind of fraudulent or dangerous activity going on in the payments platform.
5:14 So working with our payments processing partners, we came up with different agreements, they vary by country. But for example, in the US, most of you are processing with our partner TSYS, and we decided that the best solution was on auto pay transactions to hold 20% of the transaction until we can have a conversation with you and just validate that there's actual delivery of services going on. And I know this is stressful and and I just please want you to know first and foremost, we're not the ones holding the funds. If we had not advocated on your behalf, the payment processors would most likely have done something far more onerous. In fact, many payment processors are holding 100% of funds for small businesses in different verticals impacted by this crisis. And third, we're doing everything in our power to to ensure your business continuity, and to ensure that you get the funds flowing into your bank account as quickly as possible. So if you have any questions about this, talk to our payments team, they're there to serve you.
6:22 In closing, I want you to know that we remain deeply committed to this industry. And we're more impressed with you than ever. You folks inspire us every day, you're doing the work necessary to protect your businesses. You're planning for your futures. You're taking care of your team. And we know you're having to make hard decisions. And we want you to know that our complete purpose is to serve you and you're the reason that we're in this industry. And we're here for you. And if you have any further questions, please email or call us and you're welcome to email me ([email protected]), and we'll engage in a conversation. Be safe folks, be well, take care of yourselves and your families. Bye bye
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