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by Wade Wallace
April 7, 2020
In the second episode of From the Top, I speak to The Sufferfest founder David McQuillen about how he went from working in the Swiss Banking industry, to creating one of the largest indoor training platforms in his spare time and later selling the business to Wahoo Fitness.
I first met David back in 2010 at the Road World Championships in Geelong and we became good friends thereafter. We were both in similar start-up stages of our businesses and we had lots in common. When David moved to Melbourne we got together frequently to discuss business, cycling and the general landscape of both.
Meeting David for the first time in Geelong in 2010.
David is one of the most enthusiastic, humble, and clever people I’ve had the privilege of knowing and it’s been an absolute joy to watch his business flourish. As you’ll find out, even though The Sufferfest may have been a ‘happy accident’, none of the decisions he took on his successful journey have been by mistake.
This is David’s remarkable story of how he build The Sufferfest.
Wade Wallace (CyclingTips):
Dave, we’ve known each other since the very start of when both of us were creating our businesses. Can you tell me about your life before we met?
I was living in Zurich as you said, I was working in the banking industry, that’s where my career was, and having been someone who rode his bike and race since he was about 17 … 16, 17 is when I started, and living in Switzerland trying to keep on competing, doing sportives and races and things like that. It was pretty tough in the winter because … it’s a lot of snow in Switzerland and hard to get out on your bike. I was riding indoors and I was doing … I mean, you would have done these things, right, like Spinnervals.
Yeah. Yeah. I know it well. It was horrible.
Robbie Ventura videos … or just staring at the wall, like East German style. None of that worked. None of that worked for me. As soon as you’d get on the bike, you’d want to poke your eyes out, because it was so boring.
And what year was this about?
This is 2008.
2008, and when I was a kid racing, I used to get on my turbo trainer, you know one of those ones with the little fans on back, remember those?
Yeah, you’d put your front fork into it. I’d get on the turbo trainer, and I would watch VHS tapes of the 1986 Tour de France, with Hinault and LeMond, and pretend that I was climbing up Alpe d’Huez, and I thought, “Wonder if I could find that video on YouTube, and recreate those glory days as a kid?” And I did, I found it and it was like, “Wow.” But then it wasn’t that great because it wasn’t a structured workout, it was just following them up and I wasn’t doing a workout. Then I thought, “Maybe I could teach myself how to edit this video and put together a workout so that when I’m supposed to be doing a climb, I’m watching a climb, and when I’m supposed to be doing a sprint I’m watching a sprint.” And that’s how I created the first Sufferfest video.
Wow. I remember back then … as you all know I’m from Canada originally, and we did a lot of indoor trainer sessions and so forth, and I would simply put the VHS in of Lance Armstrong winning his first Tour, whatever it is, right? You got progressively more and more into it, but I would just do my workout what was ever in my training plan, and watch the video, and I never really connected the two. How did that connection for you … why was that a necessity?
I guess to keep to me engaged. I really felt when I was on the trainer and I was bored, I just didn’t want to work hard, I wasn’t thinking about working hard, I was just thinking about getting off, and counting down the time. And when I was watching those videos, I was somewhere else, I was on that climb and I was thinking about the guys in the video and thinking about the climb and what’s around that switchback and that kept me engaged and made the time pass quickly. And I think … especially as we see why people like the different apps available to them now for indoor training, one of the biggest things is being engaged. The time passes so much more quickly because you’re focused, and when you’re focused you’re more motivated and you’re going to do better work and then you’re going to get better results.
And so you created this video, and was there any commercial endeavor in your head at this time, or was this just something now that you had to put on your TV screen in front of you to pass the time and keep engaged more?
No, it was just for me. It was just for me. I was just having fun. I was enjoying teaching myself how to make these videos, and then I put some music to it, my favorite songs and, “This is great. I can listen to Muse while I’m doing this climb.” And that was really fun. I gave those videos to a few friends, though, and they really like them. “Dave, these are great, you should put these up on iTunes.” And at that time, you could do free iTunes video podcasts, there in VodCasts. And so I put them up on iTunes, I think three or four … maybe there was five, of these Sufferfest sessions. They were all numbers, Sufferfest One, Sufferfest Two. I’m sure there’s still a few people out there who’ve got these old bootlegs. And I put them up and Apple made it their sports VodCast of the week, a few weeks after I put it up, which I thought was just awesome. “This is so much fun! Cool!” And all of a sudden it was getting downloaded like crazy, and it was about this time that Napster was getting sued for not having the rights to the music they were distributing.
Yeah. And so I thought, “I should have kept this to myself.” Because I didn’t have the rights to anything. And I took everything down, and that was supposed to be the end of it, because I had other stuff to do. We had a new baby and I had a very busy job, and so … I was supposed to be done but I started getting all these emails from all these emails from people saying, “What you do with my VodCast? Where are those Sufferfests?” And I told them, “Look, it was just a joke, it was for fun, go find something else to do.” And they wouldn’t leave me alone so I thought, “Well, maybe I can actually get the rights. I have no idea how to do that, and I don’t even know how to make these videos so that they actually look good, but this will be a fun thing to do in the evenings when my family’s asleep and I’m a little bored.”
And that’s how I ended up reaching out to the UCI and to ASO, who own the Tour de France, as you of course know, and asked them whether I could have rights to their races?
And how did that go? What was the response by them? You were going to sell these, or you were just going to keep distributing them?
Well, to be honest, at that point I would have to say I wasn’t entirely clear what I was going to do. I thought maybe I could sell the things, but when I first approached UCI and ASO, I had no idea how to sell them, or what I was going to charge, or even how to make the videos. I was just experimenting and at that point I didn’t realize … and this is the benefit of being an outsider coming into an industry, I didn’t realize you’re not supposed to call ASO and just say, “Can I have the rights to the Tour de France?”
But I did that, and I did that with the UCI, and to their credit, neither of them hung up on me. They didn’t quite know what to do about it though, because they weren’t used to licensing the rights I wanted. I didn’t want the full Tour de France to broadcast to a nation, which is how ASO sells their rights. I wanted three minutes of this stage, four minutes of that stage from these different years, and I was going to put them together in a video that wasn’t going to tell the story of the race, it was going to tell the story of a workout, and just use the footage to illustrate that workout. It took a while for them to get their head around it. I had to make trips to the UCI … ASO we just dealt with on the phone and by email. But it took about nine months because we effectively created a new rights category.
And you just completely stopped at this point distributing these for free or anything, until you got that worked out, is that right?
That’s right. Yeah. It wasn’t until September 2009, that the very first Sufferfest video came out, and that was called The Downward Spiral, and it featured footage from Perry Ruby, and it also featured footage from Cycling Tips.
I remember. I remember some Glenvale Criterium or something like that I think it was, wasn’t it?
Yeah, that’s right. As I was trying to figure out how to put these videos together, I knew I was using Paris-Roubaix footage for the intervals, but I needed something for the recoveries and so I’m looking and I found this onboard camera footage from this guy in Australia racing around some Criterium circuit, thought, “That looks cool.”
“I could use that.” And so I got in touch with this guy named Wade Wallace, and asked him if I could use this footage and it turned out you were starting Cycling Tips at pretty much the same time. I think it’s pretty interesting that we’ve been on pretty parallel paths, and we’ve met just as both of our companies were starting, and you graciously allowed me to use that footage, without really realizing what you were getting into, I suppose.
Yeah, it was just footage to me, it wasn’t an asset so to speak, like UCI or ASO would have had, so … yeah. So once this all came out, Downward Spiral, now was this a commercial opportunity bubbling in your head? Or how did you start to distribute this, first off?
Well I figured out a way to sell them online. I found a platform that I could see these videos. I had made a deal with ASO and UCI who I would release a video from later on, several months later, where they would get a percentage of sales, but it was still just a hobby. I remember meeting with the UCI and they asked, “Well, how many of these things do you think you’re going to sell?” And I thought, “Well, I don’t know, I’m just doing this in my spare time and for fun. Maybe I’ll sell a total of 1000 videos over the next few years.” And they thought, “All right, this guy isn’t going to hurt anybody and it’s not going to change our life so, go ahead.”
And I remember setting up this little ding every time a sale came in … my email would ding because I was getting this notification from the sales platform. When the first ding came, I thought, “Oh my God, someone bought it. Wow! That’s awesome!” And I remember, talking to Claire and I’m like, “Wow, I sold enough videos that we can buy our Friday night pizza.” And then, “Wow, we sold enough videos we can buy our groceries for the week.” And, “Wow, we just sold enough that we can pay our mortgage.” It was just growing and growing, but it took me a while to realize that this was a business and not just a hobby I was doing for fun, because I was having a great time designing clothes and picking music and watching bike races and … probably above all, interacting with people about the Sufferfest, and that’s where the community started. But it wasn’t until the very end of 2012 that I quit my job, by this time I was living in Singapore, and was part of the management team of a bank there, and we moved to Australia to focus fully on the Sufferfest.
Just going back a little bit, you talked about community and this was at a time when social media people were figuring it out and it was exploding and Facebook looked like it was going to be the portal to the internet, and you did a phenomenal job at creating things for people to do together, whether it’s … or achievements like the knighthood, or the Tour of Sufferlandria, and you created a really, really strong community around the Sufferfest, was that something that was important to you and you saw the importance, or was it something just you enjoyed doing and it happened through an extension of yourself? How did you see that coming into it?
Well, before we go too far down that path, I would like to point out that I have not forgotten that you have not done your knighthood yet, and I-
Yeah, I know, I know. It’s a big thing, it’s a big commitment.
It is a big thing, but you’ve done many big things Wade, so I’m just waiting for you to confirm the date that you’ll be doing that. I know the Cycling Tips community would love to watch you do your knighthood, live.
This isn’t about me Dave, this is about you.
Oh sorry! I got off track. I’d love to say that so many things with the Sufferfest were planned, it would make me sound a lot more clever, but they weren’t, I was going just on gut feel and what I was having fun doing, and I was really having fun talking to people and interacting with them and finding out what they liked and what they didn’t and they were sharing stories with each other. Even the name, Sufferlandria is a concept, right? Our nation, at the Sufferfest, came about because I was making a video called Local Hero, and that was going to be the story of a Sufferfest rider being invited to the world championships. And of course if you’re at the world championships you’re representing a nation, and I didn’t know what to call that nation. And so I reached out to our Facebook group, and they came out with Sufferflandrian, like the Flandrians from Belgium, and I thought, “Well, that’s a bit awkward, but Sufferlandrian could work.”
And things like that, those kind of ideas coming from the Sufferlandrian community and building on them, I think just created this snowball thing where we just kept doing more and more because we learned so much from our customers, and that’s really reflected in how customer-focused as a company we are today. Knighthood was a guy in the U.K. who just decided to do … at the time, all of our videos back to back, which was six. And he did that, and when I was writing up the story I needed to say he accomplished something other than just riding six videos, so we came up with the idea of, “Wow, that’s a Sufferlandrian knighthood.” And the Tour of Sufferlandria was a way to take people on a journey and make them feel like they were doing a grand tour of our nation, because France and Italy and Spain, they’ve all got their grand tours, well Sufferlandria has to have one.
And so it was really just fun, and it’s still really fun. As we’ve gotten bigger it’s become a little bit more structured, because there’s so many pieces now. There’s fan groups for Sufferfest, and there’s groups I’m not allowed in on. There’s one called the Women of Sufferlandria, which is a fan group, but they won’t let me in it because I’m not a woman.
Fair enough. Now I remember … This is a strong community, and I’ve seen it firsthand, and you come from the world of banking, which I imagine is a much more serious environment and so forth. And I remember you telling me once, someone was questioning the authenticity of this knighthood that someone did, and you’re thinking, “I’ve got this fictitious country with a fictitious knighthood, and here I am, this is awake at night.” or something like that. Tell me that story, because I found that quite funny but it was a long time ago.
Yeah. I guess that was something I wasn’t quite used to. There’s nothing more serious than Swiss private banking, which is what I worked in. And so going into these communities with really passionate people talking about a sport I loved, was such a great outlet. And I was having a lot of fun with it, but also found that some people were taking it way more seriously than they probably should.
Knighthood has always been something that I felt is a very personal endeavor, it’s not something for anyone else to judge, there’s enough judgment on the internet. So we’ve never set any standards, our standard was always, “Do a ride you’re proud of.” But we had some folks who were analyzing the power files of other people who had done their knighthood, and self-proclaiming that their knighthood wasn’t worthy because they didn’t do it the same way that person did. And it was at that point that I realized, “Wow, there’s some folks who are losing sight of what this is really about.” For me, our mission is to help people feel proud of themselves, and so whatever it takes to feel proud of yourself is something that we back. We’re not into setting standards, and we had to get real clear with our community about that, most of whom were totally on board, but there were a few that felt, “Well, this isn’t for me, I want something more … ” Say more serious … and I guess more in line with their own vision of themself and we just wanted to keep it fun and engaging and supportive and I think you see that in our communities.
Again, the Tour of Sufferlandria, which we’ve been running since 2013, I think in that time I’ve had to publicly remove comments maybe three times, and asked two people to leave the community, because we will not tolerate harassment, bullying … really anything that is not positive and supportive and our-
And I imagine it’s community-moderated as well?
Yeah. One thing I’ve always admired about you Dave is that you do have this absolute fun-loving, good natured, very positive attitude and so forth, but you also do have … you’re a very clever businessperson. And I know the transition between a downloadable video style of business model, an owned video versus a subscription model was something that you would have known you had to migrate to, tell me about that process and the thoughts about going towards that … I know that you had a lot of fallout and a lot of pushback from the community as well, doing that. Talk about that and that timeline, and where your head was it.
That was really hard. That was really hard to do. So we were a media company, right? So we would make videos, and put them up and people would download them as MP4 files.
And that was great, every time we put out a video, boom, we’d get this big influx of cash, which was really nice and our rights holders liked that because they made money on it, we liked it because it gave us more money to grow as a business. And the industry was changing … early from 2013 onwards. TrainerRoad was already out. There were a few other apps that were out that were moving to this subscription based economy, and we were lagging behind a bit there. And I realized that we had to change or we were going to die, we could not keep making downloadable videos, we had to move to a subscription model. Now we were lucky enough that the co-founder of TrainerRoad, Reid Weber, had left that company, and I knew Reid from our interactions with TR, so we scooped Reid up pretty quickly and asked him to help us build an app, and he’s currently our Chief Technology Officer. So everything you see with our app is really thanks to Reid and our app development team.
Moving that way required a big shift in business model and in terms of how we thought about ourselves. So we were no longer a media company, now we were a technology company with a subscription revenue, not just downloads. That meant hiring new kinds of people. It meant pricing in a different way. It meant creating things that would keep people around and subscribing month on month. It meant transitioning our community from one where people would download and own a Sufferfest, to one where they effectively were renting their relationship with the Sufferfest. When we first moved to that, we released some of our new videos and we released them only in the app … that created a much bigger backlash than I expected.
We got a lot of angry people who felt that we should have stayed as a media company, and wanted their videos to own. I tried … I was really personally involved in all the forums and reaching out to folks and just trying to explain that, “Look, if we stayed that way, we’d be dead, we could not do it.”
Why did you think you’d be dead? Why not just continue along the lines of making more and selling more? Where did you see that endgame?
If we had stayed that way, we would only have ever been able to fund making more cycling videos, and we wouldn’t have been able to add all the stuff that we have today, with strength training and yoga. I couldn’t have brought the sports science into our platform the way it is today. And so if we just had our videos, folks would have likely got tired of that, and with all the subscription platforms out there, it would have been hard for folks to justify spending 20 bucks on a Sufferfest video and then also on their subscription. I felt like we couldn’t give them enough value to survive as a company.
So getting our community over … took some work. One of the things that folks wanted was a free subscription to the Sufferfest app, because they would say, “Look, I bought 10 videos and I sent all this money and now you’ve got this app, well I should get the app for free.”
And that was really hard. I think in hindsight I would have handled that a little bit differently, today I would have probably given those folks some discount or trial for a longer period. I didn’t do that, I felt that we had an app that really did justify the value and it was far more than the videos they bought, and plus we didn’t take the videos they bought away, they still had them, they can still use them. But I’m really proud of the way that we have now fully transitioned to a tech company, and what we’re capable of doing today. And I know that if we hadn’t moved to a subscription, there’s no way we could offer Sufferlandrians the full Sufferfest experience, as it’s known in our app today.
Now, selling a video and downloading it and putting some credit card details in, versus creating an app and recurring revenue and those backend billing systems, that would have taken a lot of technology and investment, has this always been a self-funded, off your profits business, or did you have to look for external investment or … how has that worked for you?
Because I had a job, the first several years of the Sufferfest I didn’t take any money out, we just left it in the business, so it just sat there. And when I quit banking, and I needed to start taking a salary I did that, but then started moving the cash that we’d accumulated into funding the growth of the business. And over the years there certainly been a lot of times where I’ve thought, “Should we take investment in order to grow?” But I quickly came to the realization that getting investors in was going to create a lifestyle for me that was not what I was looking for. I left banking because I wanted to be in control of my own destiny, I wanted to have a quality of life that I was in control of and a lifestyle that reflected who I wanted to be with my family and also with my team, and I didn’t want pressure from outside investors. So I decided that we are going to remain a self-funded company, or we’ll get acquired, but we are not looking for investors.
I imagine you had … or maybe you didn’t, but did you have sleepless nights of how are you going to make a payroll, cashflow issues and all that, or was this something that you’ve always been very diligent with, kept very close management on and never had to worry about that side of things?
Well, you’re an entrepreneur too, right? So you probably know that quote from Andy Grove at Intel, “Only the paranoid survive.” I would say we were really responsible financially. I never had a worry let’s say month to month that we weren’t going to make payroll, because we grew in a very controlled way that was based on … I would say realistic forecasts of our growth. However, I was always paranoid that today was the day that the business was going collapse. That something was going to happen, something was going to come out, people were going to leaver, Sufferlandrians were just going to decide this wasn’t what they wanted anymore. Always paranoid and that just drove me to keep thinking, “What do we need to do next? How can we do better?” That’s what kept me up at night, was that feeling that it’s all going to disappear tomorrow.
And maybe that’s a good segue to talking about one of the biggest disrupters in the indoor training arena, is Zwift. And when they came on, and to see what they were doing and the investment they had behind them, what were your initial thoughts to that, and how did you react from a business sense?
Yeah, when they first came out it was like, “Whoa, wow, that’s pretty cool.” I guess when they first came out I didn’t realize just how big they were going to be, but I immediately recognized Zwift as a really interesting, compelling platform that was going to change the landscape, and that … I guess there’s two things you can do there, one is you can just say, “Well, we’re going to keep doing what we do now and we’re going to hope we last for a while.” Or you can reinvent yourself to face that new competition, and that’s what I did and that’s what we’ve always done at the Sufferfest is reinvent ourself. And that was the moment where we really started thinking, “Okay now, how do we continue to remain relevant in the lives of endurance athletes and Sufferlandrians? What else do we have to be awesome at, so that people will still subscribe to the Sufferfest either as their primary subscription, or as a complementary subscription to Zwift?”
I think that’s a really strong point. I always saw a very mature realization from you that, “We’re not competing against Zwift, we have to do something different.” And the fact that Zwift is actually an opportunity that they’re going to grow the pie for us, you always took that stance which I always thought was really … both mature and clever. Did it take you a while for that realization or was that something that you saw immediately, or how did that come about?
I probably didn’t see it immediately, I’d love to say I did. It would have come quite quickly though, but not immediately. I was probably quite worried about them at first, but there’s no point in just being worried and gnashing your teeth, you got to figure out what to do. And I thought, “Well we can’t compete with the game they’re building, so we’ve got to find a new way to compete, and what’s that going to be?” Well it’s going to be by being the most comprehensive solution. It’s not just about getting on and joining a virtual group ride, it’s going to be about the best sports science for the most effective workouts you can possibly get. It’s going to be about cross-training, so that led us into mental toughness and yoga and strength training, it’s going to be about the best training plans.
This is about the time where we doubled down with Neal Henderson, our coach, and brought him in more fully and brought his team in, with Mac Cassin, our physiologist, and really said, “We’re focusing on sports science, so that every second you spend with the Sufferfest is going to give you a greater return than anywhere else.” All that thinking, and that path, I would say emerged over the year after Zwift came out.
Hey folks, I’m Wade Wallace, the founder of cylcingtips.com. Content like this is enabled by the support of VeloClub, our membership program that brings in our listeners to support what we do with their membership dollars. Not only does it help us fund content like this, but you also get loads of benefits such as our annual premium magazine, access to forums that allows you to engage with our editors and other members, industry discounts, exclusive content, and access to our annual VeloClub Summit, which in 2020 we’ll be going to the Taiwan KOM. If you enjoy what we do, please consider joining in our mission to bring you the best and most comprehensive cycling content in the world, so we can do that for you. It funds this podcast, and now it’s funding our coverage of women’s cycling, which is incredibly important to us. Just head over to cyclingtips.com/signup to become a member, and to become an important part of what we do. Now, back to this episode of From the Top.
Do you have any business mentors, or is this something that you just feel like you’re figuring out on your own, or is your team very collaborative in this? How do you get inspiration, your ideas, your external ways of thinking?
I’ve got a couple of business mentors that I talk to from time to time, but not in any real depth. What we’ve done is largely internal, based on my own thinking together with the thinking from my team, especially over the last several years as we’ve gotten bigger we’ve brought on more skills with our COO Aaron Johnson, and I mentioned Reid and Neal and Dylan in marketing. As we’ve brought these folks on and put their brains to work, it’s an incredibly collaborative experience now, which I get a lot of joy out of, and the ideas coming out of the team are just awesome. I’m having so much fun with our sports scientists and our developers, and of course still on the marketing side we really enjoy coming up with pretty playful campaigns. And the videos themselves, I did all of those myself for a really long time, and-
Yeah. The editing and everything, hey?
Yeah, and it’s because I love it, to me it’s my art. That’s like revealing a painting when a new video comes out. It’s spending so much time thinking about storylines and video and narrative and, “How do I make you laugh when you’re suffering the most? And how do we add to the Sufferlandrian mythology?” I used to do a lot of creative writing, and to me Sufferfest videos are just continuing that creative process of telling great stories. Now I’ve also started to get some help on that though, one of our team, Francois, he helps now with the music and some of the video editing, which allows us to bring out video more quickly.
Yeah. Now, recently Wahoo acquired you, so congratulations for that, I was very happy when I saw that news. You had other potential suitors in the past as well, that I remember us talking about. Can you talk about what happened there, why they weren’t right, and why Wahoo was right?
Well, culture really. We’ve been approached in the past to be acquired, and that started as this trend, which you’re seeing now, which is ecosystems of hardware and software, the most visible of which is Peloton, began to rise. And the hardware companies saw that happening, probably a little bit before we did, and they began approaching us, but there was just never … I don’t know, we’re just so particular in Sufferlandria about our culture and how customer focused we are and how we work and how we reinvent ourselves in the face of adversity, the breadth of our thinking, our ambition, and we just quite weren’t finding the right match. And I suppose that also may be on the other side as well, they were just seeing that, “Wow, okay, these guys are a little bit special.” But Wahoo was absolutely the perfect match. Just the other day, their CFO was saying, “We’re long lost brothers who have found each other.” We just fit so well together. I think you can take anybody from Wahoo and put them in the Sufferfest team, or vice versa, and they would know what to do.
Yeah. I was going to ask too, I remember at one time you guys were really looking at getting into the gym space, doing possibly a Sufferfest … whether it’s gym network or licensing to gyms and stuff, do you guys still license to gyms, and is that space something that you still feel has opportunity in, or is that something that you’re not interested in anymore?
Yeah, boy, the group fitness space, holy cow, have we learned a lot there. We originally had the idea that, “Wow, we’ve got these great Sufferfest videos, and they’re awesome, and they would be great in spin classes, because now the instructor would have something to show everybody and the class wouldn’t have to imagine climbing a hill, they could actually be watching themselves chasing Alberto Contador up a climb in the Volta, isn’t that awesome?” So we started licensing our videos out to gyms, and it has been a real learning experience for us. Let’s just say, one of the key learnings, fitness enthusiasts who go to spin classes are not the same kinds of people who are endurance athletes. Endurance athletes, they want structured workouts, they want to work hard, they don’t need an instructor motivating them, they’re largely self-motivated, and the idea of suffering is something that appeals to them. Whereas fitness enthusiasts, they are not in that spin class to suffer. They are there to listen to some great music and get a workout and burn calories. They’re not necessarily interested in progressive fitness. So we’ve had to do a lot of work on the commercial side with gyms and cycling studios, to tweak our offering. We’re now known in that industry as SUF Cycling, no longer the Sufferfest, because the Sufferfest was just too scary.
So you’re still in that industry? You still have a market there?
Yes, we’re still there, we’re still supporting that industry. I’d say we’ve got some thinking to do about how much more we do there, whether we’re going to go deeper into that space, or whether we’re just going to maintain where we are. There’s some other players out there that are coming out with some pretty neat technology for gyms and cycling studios, and we either need to reinvent ourselves again, in that space, or find a way to collaborate with them. And I-
Is that a big enough market for you guys to really pay attention to and possibly reinvent?
Yes, but it requires a lot of effort and a lot of resources, and I’d say we’re still at the point where we’re thinking about that, how we go about it. I don’t know yet, we talk about it a lot … We haven’t made a decision yet, it’s still unclear. It’s and industry that’s changing pretty rapidly too so, and these are the things where … It’s running a business like this because we’re figuring it out as we go along a bit, we’re trying to bring the right resources in that have got the expertise in that space that can help us, but we’ve yet to make a strategic decision on what to do.
Right, right. Just back on what you said earlier about the company culture and the fit with Wahoo was very perfect and so forth, how much have you really paid attention to building a company culture and strategically done so versus how much is it just you attracting people that are similar to yourself and you’re good people and energetic, how much emphasis and focus and actual structure do you put behind building the company culture?
Well, the latter is really important, hiring people who share our beliefs. In our hiring, we’ve brought on board a lot of Sufferlandrians, so folks who were part of our community now work with us. Our COO, Aaron Johnson, we first discovered Aaron in the Tour of Sufferlandria, he was posting all these crazy videos and he was a stay at home dad who had done three tours of Afghanistan as a marine, and he was riding and deeply into Sufferlandrian culture, and I just thought, “This guy is hilarious.” And one day he put up a post saying how he was going to go and find a job because he would rather go back to do another tour on the front lines than spend a year with his three little girls at home, because that was far harder than being shot at.
He needed to get a job, and so I called Aaron, I say, “Hey, wait, don’t go get a job, come work with us.” The same … Dylan Robbins, our head of marketing, was a Sufferlandrian, our head of customer service … actually everybody who works in customer service, were people who were Sufferlandrians first, and now they work with us. And that’s been really important because they’re immediately into the culture, they know how we treat people, they know that we’re about helping people feel proud of themselves, they know that we always do the right thing and treat people with respect, whether that’s our competitors or our customers. And that has probably been the biggest contributor to our culture.
Now, at the same time, we also work hard to make sure that everybody knows what we’re doing. At our annual conference this year, we were saying there’s nothing more important than our customers and being customer focused, and here are some of the things that we’re going this year to make sure that we never lose sight of that. And that’s just reinforcing what everybody already knows … pretty much everybody at the Sufferfest knows at least a dozen Sufferlandrians by name. We’re very close to our community, we interact with them every day. I’m struggling because I’m thinking, “Man, we put some things in place but it also just happens naturally.” Because everybody does it, and then anyone new who joins the company sees that that’s what we do and they just start doing it too. I don’t think you can ever neglect it though, I don’t think you can ever take advantage of that or think that it’s just a given, you do have to keep investing in it and that’s why at our … like I said, at our annual conference we were really driving home that message and we are investing in programs that are going to make sure that we keep doing that.
Could you ever foresee a day where you’re hiring people who know nothing about the Sufferfest or cycling and who are just very, very good at their jobs, whether it’s something that’s a little less external facing? Or is that something important to you that they really, really understand the culture, no matter where they sit in the company?
Well we just did that. We just hired a designer who doesn’t come from cycling, didn’t know the Sufferfest, but she’s an incredibly talented designer. And she demonstrated thought that she was very aware of how important our culture was, and that it was important for her to learn about it and to immerse herself in it. And so she’s already actually started riding her bike to work and back, she’s done Sufferfest videos, she’s done yoga, she’s getting into it, and we hired her because she was willing to do that. It did take quite a bit of discussion though, on our side, like, “Boy, we’ve always hired folks who know who we are and what we’re about, this is going to be a big step for us.” As we get bigger I don’t think we can avoid that, and we just have to be more conscious about hiring people who have got the right character traits for being in a customer focused business, and-
Now, you have employees all over the world I imagine, by the sounds of it, in the U.S. and Australia, possibly elsewhere. How do you find running a distributed work team and various time zones and so forth, how do you find that?
Well we are all over the place. We’ve got folks from coast to coast in America, the U.K., France, Australia, we are all over the place. We say, “The sun never sets on Sufferlandria, we’re always working.” I would say a distributed company has got its advantages in that you can hire people pretty much anywhere they live, and that’s great. And you can get a lot of work done if you’ve got strong personal relationships, which is why we get people together on a regular basis. However, I also feel pretty strongly that you get better work done when you are with people in the same physical space, and I think there’s a bit of a myth about the distributed company being completely ideal, and that’s not what I found.
So we are consolidating our team … let’s say we’re creating focus points for the company. So Reno, Nevada, is where all of our developers are, or most of them. We’ve got one guy in Pakistan and one quality person up in the Pacific Northwest, but by and large, Reno is where our developers are based. And Boulder, Colorado is where our sports science team is based, and Hobart, Tasmania, is where our creative team is based. So marketing and experienced design and myself. So those are the three focal points and that’s where we want to continue to hire more. If we find the right people remotely, then yeah, we’ll bring them on board, but we really want folks in those three towns.
I feel like we can get better work done like that.
Yeah, yeah, I know what you’re saying. What would you day to someone who sees a problem in something that they love to do, and they’ve thought about creating a business, what advice would you give someone like that, and would you encourage that?
Absolutely, man. Absolutely. I see folks like that all the time, and I’m sure people are listening right now … you’re sitting there and you’re thinking, “I’ve got an idea for something.” But you’re not doing it because you don’t know how to get started, or you don’t have confidence in your ability to pull it off. While I’m only one story, I wouldn’t say I’m really unique in any capability, other than I just decided, “Well, why not? I’ve got nothing to lose, let me just try this, if it’s not me it’ll be someone else. So let’s just go and have fun.” And I didn’t know how to run a business or edit video or get rights or create a subscription business or really anything about yoga, but we’ve done it. And I think if you had told me back in 2009 when I really started doing the Sufferfest, what I was going to have to have built by 2019, I would have stopped right then because I would have thought, “There’s no way I’m capable of creating that. There’s no way I’m-
Yeah, it’d be terrifying. But now it all just seems super natural, because it’s evolved over time and I … Anyone who’s got an idea that they think solves a problem that someone else isn’t solving already and … Go for it, what have you got to lose? Just try. You don’t next to make the next Google, you can make a really small business that’s super fun and that brings happiness and fulfillment to you and helps other people. Just try it.
Sufferfest is arguably one of the pioneers in the indoor cycling content space and training apps, and that’s I imagine something not that you ever envisioned coming into this, when you just made this first video of Greg LeMond in 1986.
That was just a video, you were just supposed to do it, keep you busy for an hour on the trainer, right? There was no idea of a training plan or even structured training or cross training or science, I designed those workouts … I didn’t know what I was doing, that’s why we brought our sports science team in. I never had the idea that we would be what we are today.
No. And there’s many ways of creating a business. Sometimes people go and create a business plan and raise money and execute beautifully, and those are just dream scenarios, and it’s actually never as easy as I just made it sound, but would you say that your business was a bit of a happy accident, is that fair to say?
Absolutely. And that’s probably disappointing for people to hear, if you’re taking notes like, “Ah, these are some of the things that I can take away from this podcast, writing down.” “You don’t need to have a plan.” probably isn’t what people want to hear, but I never had a plan, it really wasn’t … Well, it was an accident in one way, but I suppose what allowed us to grown and keep reinventing ourselves, was staying really close to our customers. And we weren’t releasing videos or things that we thought they needed, or creating products looking for a solution. From day one I was talking to our customers, trying to find out what they wanted and what they needed. And of course because I was a cyclist training indoors myself, I also had a pretty deep sense of that. And that drives us today … conversations with our customers. We’ve got a dedicated group that we … we talk to them about ideas, we do research with them, we get feedback from them, and that drives our innovation. If there was anything that’s allowed us to keep growing, and do so in a way that’s sustainable, it’s this.
It’s good management that you’ve had an upward trajectory in a fairly smooth path, but times couldn’t have always been good I don’t imagine, what are some of the unanticipated challenges that you’ve faced that you would have never ever been able to plan on, and what were those challenges?
Oh boy, challenges that we’ve had, how many? Gosh. Letting go, man. Over the Sufferfest journey, over the past 10 years, probably the hardest thing for me has been letting go, because when you start your company and … I was doing everything, making videos, customer service, marketing, dealing with rights holders, handling shipping orders, I used to pack clothes in envelopes myself and hand write notes. When you do that, you think, “No one else is going to care about my customers as much as me, and I can’t risk my business by letting someone else do that.” You’ve probably had that Cycling Tips, where the first time you ever asked someone else to write an article you were probably freaking about whether it was going to be good enough.
And the first person I ever hired at the Sufferfests was someone in customer service to help part-time, and I was a nervous wreck. That was probably even harder than going to a subscription model, because that was letting someone else take care of my customers. Oh my goodness, that’s like letting someone take care of my babies. Letting go was really hard, and then bringing someone on to help with marketing, and to help-
Well, external communication would also be hard for you, public communication is in marketing messages.
I did all the social media, no one else can do that, what if they get it wrong? Now that I’m thinking about it, that’s probably what kept me up at night, worrying about that. But today, I’ve got things happening at the Sufferfest that I only have a passing knowledge of. There’s teams doing planning and writing … The 30 day yoga challenge that we just ran, that’s something I had almost nothing to do with, we’ve got a team that’s running that and doing an amazing job. And what you learn when you let go, is there are people who can do a far better job than you, and you should let them do it.
Yeah, you can’t do everything. You can’t do everything, and I’ve always said, “Hire people better than me, because why hire them otherwise?” Right? And there’s lots of people better.
Yes. Yeah, I think I’m pretty aware of my limitations and have worked hard to hire folks who are going to do that better job. I still probably meddle in too many things, and get distracted, but I’m getting better at that.
Do you ever have the, “Hey, I’ve got nothing to do today, I’m bored. Let’s wind up all my employees, because I’m not doing anything they must not be either.” Do you ever have that, or are you quite disciplined in like, “Wow, I’ve got a day off, this is great.”
I find it really hard to unplug and get away from it, and if I’m bored then you can bet that I start poking around at … and the team would know that so I’m sure they’re probably happier when I’m fully engaged in stuff. But I think also as the owner and the founder you just do that naturally because you care, and you just want to make sure that everything’s bumping along in the right direction. I have got better, we’ve gotten a lot more structured in our planning, I’d say that’s a big change that we’ve got as we’ve got bigger, is we’re now really structured in how we plan our work and how we execute on that. And I’ve been told in no uncertain terms by my team that if this is what we’re planning this quarter, there’s no new stuff allowed. And so I’m trying to be good, but I’ve got a lot of ideas, Wade.
What’s the most satisfying thing about taking a step back and looking about something you built literally from nothing?
Seeing how it’s affected the lives of other people. For me stepping back means turning around and facing our customers and looking at their comments in our different forums, and reading their stories about how it’s changed their life, whether that’s the mental training program or the training they’ve been doing on the bike or how they’ve suddenly picked up strength training. And then seeing how they treat other Sufferlandrians and support them, that’s awesome. That I feel like, “Okay, I’ve done my job. That’s great.” That is super satisfying, that’s probably way more satisfying than releasing new product or anything. Seeing Sufferlandrians treat other Sufferlandrians and encouraging them to achieve their goals, and help them feel proud of themselves, that’s awesome.
Do you see anything coming up that is, “This going to be big. This is going to be a big challenge?” Is there anything you could talk about that you foresee?
Yeah, well absolutely. One, is the rise of ecosystems. So this integration between hardware and software, and that’s something I saw a couple of years ago when we first started to get approached by hardware manufacturers, and Peloton was making noise. You could just see that a company that could pull hardware and software together, was really going to create a platform that would add huge value for customers and be pretty hard to leave. And at that time we were not part of any hardware business, and we were probably in a position where we were third in terms of the apps in the landscape, and how being a self-funded company were we going to move ourself up into the top two, get enough attention to have one of the major hardware players look at us and say, “Hey, this is our software player to build an ecosystem.”
Now that we’re part of Wahoo, we’re incredibly well positioned to build a powerful ecosystem, with the portfolio of hardware that they got, I’m super excited about that. That’s going to be a challenge though, because there’s a lot of folks out there who want to create the dominant ecosystem. And for a long time I was really worried about what was going to happen if we did not become part of an ecosystem, because I don’t believe that small apps are going to be able to survive outside the ecosystems. The cost of customer acquisition is going to be way too high, the cost of innovation is going to be way too high, and the switching cost for customers will be way too high.
Do you see yourself being always a hardware agnostic, but still being in an ecosystem that allows for more customer acquisition and so forth, or do you foresee many of the apps and hardware collaborations being what they were built for?
We’ll remain hardware agnostic, so our intention is to always work with all hardware standards, and therefore hardware providers that are following those standards going forward. Wahoo is also fully in agreement with us on that.
The other one that has happened similar is Garmin bought Tacx, I guess Tacx would have some sort of software that they integrate, is that correct?
Yeah. Tacx has had software for a long time, it’s not that high profile as it’s really been focused on Tacx trainer owners, and they have intermittently invested in that, but I would fully expect them to be digging deep on that software now, because they’ve got the computers, they’ve got the trainers, now they’ve got the software, they also have the content, because they’ve got a lot of video. And I really believe content is going to … content is king, right? Content is really going to be absolutely critical to the success of any ecosystem going forward. So we’ve got the Garmin Tacx one, we’ve got Wahoo Sufferfest, you also Stages emerging, they’re investing … they’ve released a head unit now, they’ve got some content, they’ve got bikes, they released a smart bike for home. That’s interesting. Wattbike hasn’t made any major content moves yet, but they’ve got some interesting hardware. Zwift of course, and they’ve-
Can’t be long before they acquire someone or come out with something of their own.
Yeah, absolutely. So, you can see these ecosystems starting, so what’s really going to make them successful is how well does the whole achieve greater than the individual parts, right? And so while the Sufferfest, working with Wahoo, we’ll create some things that really achieve … that are really special with Wahoo products, and that you can probably only do with Wahoo products, will still support hardware standards across the board. And I expect every other ecosystem to do that too, because you don’t want to alienate … you don’t want to tell someone that they can’t subscribe to your platform because they’re using someone else’s heart rate monitor, for example.
Yeah, yeah. How much do you put down to the success of the Sufferfest to luck, how much to hard work, and how much to skill? Have you ever thought about that?
Luck … I would discount luck, because as they say, “Luck favors the prepared.” I don’t think we’ve been lucky, we’ve really had to work hard and scramble at those points where I felt our business was at risk. We weren’t lucky to get through to those things, we had to take tough decisions and make it happen. So I guess our skill in decision making helped us there, but the biggest thing … you said hard work. We’ve worked hard, but it’s really just been down to just how much we love doing this stuff. I don’t really think about going to work, I just love doing this. I love making new things. I love seeing the Sufferfest team coming up with stuff and bringing it to market. I love working with really creative partners like Abi Carver at Yoga 15. Today we’re releasing five new videos from Abi of super basic yoga sessions, 15 minutes of just learning the basics, so we’ve five new videos. That’s come directly as feedback from our customers who were saying, “Hey, some of these routines are just a bit too tough for me, because I’ve never done yoga before in my life and I can’t touch my toes.” So working with Abi we’ve got five new sessions.
That’s all just been passion and hard work and staying close to our customers and that’s it, there’s no luck in that, that’s just wanting to do the best you can, and trying to make sure that it happens.
The old cliché, if you love what you do there’s never another day of work, it’s very true isn’t it?
Yeah. There’s still stuff I can’t stand doing, right? I hate admin, I hate putting presentations together, because I got scarred from doing that in my consulting days, going through due diligence with Wahoo was really tough. There’s stuff I don’t like doing, but as much as I can I try to and get other people to do that stuff now, and I focus on what I’m really good at … or at least what I think I’m really good at, which is more the creative side and content creation and the strategy for where we’re going, going forward.
And how does the business Dave McQuillen look at other businesses now, how has your perspective changed on when you look at another business and say, “That is a good business. That’s not such a good business.” Now that you have seen firsthand how difficult it is to build a business and the efficiencies of trying to make a profit, for example, how does it change the way you look at other businesses?
I’m far more appreciative of what it takes to do that. The creativity, the energy, the leadership. When I see businesses now, I’m often thinking, “Wow, how did they get that idea, and what does it take?” I try and think through their journey, I really am much more sensitive to the fact that there’s human beings who have devoted their time and energy and creativity to bring this to life, and I think that’s something a lot of folks forget when they criticize companies, or maybe get nasty on the socials about what companies should or shouldn’t be doing. They forget that … look, there’s people who really care who are working really hard and trying their best. I’m just a lot more in tuned to that than I think I ever was before.
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