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This Startup Wants to Take On Equinox and Crunch Fitness

Celebrity Sightings in New York City - September 7, 2016Celebrity Sightings in New York City - September 7, 2016
Singer Taylor Swift is seen coming out of a gym in Soho on September 7, 2016 in New York City. Raymond Hall—GC Images/Getty Images

For nearly six years, Selina Tobaccowala, the president and chief technology officer at online survey startup SurveyMonkey, never exercised. A mother of two, she was overwhelmed with the demands of her job and her family, and a 20 mile commute from San Francisco.

Then tragedy happened in 2015. Her friend, boss and mentor, Dave Goldberg, the CEO of SurveyMonkey, suddenly died from a heart problem while on vacation in Mexico.

Tobaccowala realized she had to start paying more attention to her health and exercising more. But the demands from her professional and personal life were still the same. Tobaccowala, who co-founded online invite pioneer Evite with Al Lieb in 1998, and later sold it to media conglomerate IAC, also began getting the startup bug again. She teamed with Lieb, who had recently lost 30 pounds using a new exercise and diet routine, to brainstorming ideas about encouraging people exercise.

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Their brainchild is Gixo, a personalized fitness app that features live audio and video classes to its paying users, who are subscribed to the app. It essentially turns phones into virtual gyms, according to Tobaccowala.

The company, which debuted to the public on Thursday, has raised $3.7 million in funding from Greylock Partners, with Cowboy Ventures and xSeed Capital.

For Tobaccowala and Lieb, the goal was to create an easy way for people to exercise in at home, in their backyards, or in parks without breaking the bank. “We thought about how to use technology to create a new way for people to exercise and is accessible to a larger demographic,” she said in an interview with Fortune.

The app provides more than 20 exercise classes daily, from 15 minutes to 40-minutes long, in a range of intensities. They all use a mix of walking or running and strength training using the participants’ own body weight as resistance. Gixo starts at $24 monthly, or $19 monthly for people who pay for an entire year of unlimited classes. By comparison, high-end gym memberships can cost up to $250 per month excluding initiation fees. SoulCycle, a chain of popular spinning studios, costs at least $30 per class, not including rental fees for cycling shoes.

Gixo’s classes are primarily done via audio, so all users need are headphones and mobile phones. Because all classes are live, coaches can give users personalized feedback after the workouts, by seeing data like steps burned, which is tracked through the phone. Tobaccowala says that users can report their reps and integrate heart rate monitors with the app, and coaches will give feedback based on this data. Gixo even hired a DJ to create custom music compilations for their classes.

LinkedIn founder and Greylock investor Reid Hoffman, who has backed the likes of Facebook, sits on the company’s board and was immediately impressed by Lieb and Tobaccowala’s drive to make exercise accessible and cost-friendly to the masses.

“It’s about how do we get health to hundreds of millions of people,” Hoffman said. “This product can make a difference in the scale of human life.”

Fitness is a massive industry. In the U.S. alone, people spend $30 billion annually on health and fitness clubs, according to research firm IBISworld. Because of the huge amount of money, there’s a tremendous amount of competition. Not only will Gixo compete with gym chains Crunch Fitness and 24 Hour Fitness, but it will also go up against many of the technology upstarts that are tackling the same market including Aaptiv and MoveWith. Beach Body offers a line of video workouts that can be watched over the internet. There’s also Peloton, which brings spinning classes to users’ homes via an internet connected bike.

Tobaccowala acknowledged that there is plenty of competition, but she believes her startup’s lower prices and personalized attention will help it compete.