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CEO Corner: Kari Saitowitz on Journey from Boardrooms of PepsiCo to Becoming Fhitting Room’s Founder & CEO

CEO Corner: Kari Saitowitz on Journey from Boardrooms of PepsiCo to Becoming Fhitting Room’s Founder & CEO

Fhitting Room CEO & founder Kari Saitowitz’s journey wasn’t always in the landscape of fitness. The entrepreneur’s pre-Fhitting Room career included impressive stints at American Express and PepsiCo, where she worked within marketing. In the hot seat for Athletech News’s CEO/Founder Corner series, Saitowitz candidly talks about the biggest obstacles she encountered as Fhitting Room’s architect and what her colleagues believe are her strengths.

“I believe Fhitting Room’s biggest strength [is] really our intellectual property. It’s how we train our trainers, our programming for the workouts, and then our marketing and branding and the way in which we develop community,” says Fhitting Room CEO & founder Kari Saitowitz. The fitness vanguard took her knowledge of marketing and business from previous positions at PepsiCo and American Express to spearhead an inclusive workout format at one of New York City’s principal HIIT and strength training boutique gyms.  

With plans to expand in New Jersey, Saitowitz has learned how to continue advancing in the fitness space with Fhitting Room, due to the ever-changing landscape of health and wellness. Born from the germ of a thought enveloped in an email simply titled “Gym Idea,” Saitowitz is ready to take Fhitting Room to new levels in 2022 and beyond. But, of course, the path to greatness is often a winding one, filled with unforeseen hurdles, which Saitowitz graciously reflects upon via Athletech News in our CEO/Founder Corner series.

Athletech News (ATN): Tell us about your background

Kari Saitowitz: I started my career in strategic planning and business development at American Express. Then I went to business school and during business school, I interned at Pepsi in the marketing department. Then I returned to Pepsi and worked in marketing for the next five years. That was really a dream job for me. I focused on brand building for large and existing powerhouse brands. I worked on new product launches and I also got to work on creating some awesome consumer experiences. That was my pre-Fhitting Room background. 

ATN: Please tell us about your current company and how either your role or the company (if you are a founder) came to fruition 

Kari Saitowitz: Fhitting Room is a New York City-based boutique fitness brand. We specialize in high intensity interval training [HIIT] and strength training. Our workouts only utilize functional movements, so basically movements that translate to everyday life activities: pushing, pulling, squatting. Things like that. We have a specialization/focus on kettlebell training specifically, because it is so incredibly functional and has limitless progressions. But when the company started, I saw an opportunity to deliver the benefits of a personal training session in a fun, motivating and more price-accessible group setting.  

Right now, Fhitting Room owns and operates three studios in New York City. We have live virtual classes that we run very similarly to our in-class format. So we cap the number of people in the classes, although they’re digital, and we make sure that everybody has face-to-face two-way communication. We also have an on-demand subscription service.  

So really at the outset the concept started because I couldn’t wrap my head around consumer behavior. I absolutely love observing how people behave. It’s the marketer and brand builder in me. What I saw was my personal trainer had all of these clients who were starting to run around to new boutique studio concepts and I kind of became obsessed with the idea of delivering a personal trainer quality workout, but in a class format, so it  would still be social and community building. Now even more so than probably ever before, I think it’s just so important to satisfy social and emotional wellness in addition to physical fitness. So, the concept really brings together all of that.

ATN: What was your journey like to get to this point?

Kari Saitowitz: I’d like to say my journey was non-linear. I describe myself as an “accidental entrepreneur” — I’ve always loved brands and marketing and consumer experiences, but I never really imagined myself starting a company or working for anything less than even a very large company. Obviously on the surface, fitness and soda don’t necessarily appear to have a lot in common as far as a product.  

I left my job at Pepsi back in 2007. When I had my older son, I thought I’d be a stay at home mother. So I stepped away from working for about five years. Fhitting Room came to be through observing the New York City fitness scene and having an idea I couldn’t shake. Essentially, that’s how I got to [the] Fhitting Room. 

I wrote my first email about Fhitting Room, which was so brilliantly titled “Gym Idea” about four years later [after leaving Pepsi in 2007]. I didn’t jump straight from marketing PepsiCo products into fitness. But the way I see it, they were both really all about consumer experiences. At Pepsi,  while I did work on some of the soda brands, I also worked on some of their healthier products, the water portfolio, their juice portfolio. But it really all comes down to bringing happiness to people. For Fhitting Room it was the idea that I felt something was lacking or there was an opportunity in the group fitness space around this idea of a workout that would really be delivered by the highest quality certified personal trainers, but that you didn’t have to give up your entire paycheck and/or your social happiness to engage in that kind of workout.

The common thread is really bringing happiness to people’s lives, but obviously the products are quite different.  

ATN: When have you failed? Talk about your failures? What have you learned from them? 

Kari Saitowitz: I totally misjudged my initial business model and really underestimated the complexity of the build-out required.

The first Fhitting Room location was not sound nor vibration proof and it did have residents. It was the ground floor of a residential building living upstairs, and that was despite knowing I needed to do those things. I hired what appeared to be [an] accredited architect… a relatively expensive architect as well as an acoustical consultant. They both had what I thought were  various projects in their portfolios that had experiences that would directly translate to what I needed done in the studio, although neither of them had worked specifically in fitness at the time. 

The other challenge was I misjudged my business plan itself. I learned or discovered only after the lease was signed and the construction was completed that the space ended up being too small to execute our business model that I had driven all of the financial projections from. Not only did I have to invest additional capital in a partial rebuild of the space, I also was never able to fully capitalize on the demand that we generated to turn a profit or get a return on that initial investment.  

I underestimated the amount of space that we would need for each client in order to execute our actual workout program and ended up with too few revenue generating spots in the classes. So even though the brand got off to a pretty strong start and we operated at over a hundred percent capacity, because we would have people late cancel for our class or not show up and be able to get people in off the waitlist, I still couldn’t turn a profit in that original space that I not only spent money to renovate, but spent money to renovate twice.  

Ultimately I had to close that original location and move to a business model where we doubled the number of clients in each class. Both of those decisions where, one, just very difficult decisions to make and pull the trigger on, but also very scary decisions to make because clients loved the original experience and it wasn’t a sure thing how it would be received, but I really had no choice. 

ATN: Where do you see the future of fitness going? 

Kari Saitowitz: I really believe in both the long term for physical and digital fitness. I think that there are huge markets for both. Just like the bagel shop down the street still needs a website, I think even the most physical businesses will still need some digital offerings for their clients.

Then, of course, we have digital first companies as well that have their own hardware. I do think there’s certainly going to be long term winners in both physical and digital and most will end up dabbling in each other. If you think about Peloton they still do have physical showrooms, or you think about MIRROR’s agreement with lululemon. There’s overlap there, and of course all of the physical fitness businesses have online offerings so that clients can continue to do the workouts that they love and engage with the trainers who they love, or continue to work out with them digitally when they can’t be in a studio. I think there’s room for both.  

Overall I believe that what’s going to happen in the world of fitness is [what] I call “consumer centric consolidation and collaboration.” I think that we have to really look at who our consumers are and serve all of their health and wellness needs. I’m a very big believer in brands [not being] everything to everyone. So for Fhitting Room we will focus on what we do best, but I believe that brands will form partnerships, joint ventures, collaborations, occupy shared space and we’ll start to really look to serve the entire health and wellness needs of our consumers, broadly defined. Not necessarily that all of a sudden Fhitting Room will start providing things that we’re not experts in, but we’re gonna find a way to be part of solutions that are formed around client needs.

ATN: How would your colleagues, your co-founders, describe your strengths as a manager? 

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Kari Saitowitz: I’m a good listener and I’m receptive to feedback. I make time for every human and give people the space to be themselves. I challenge my team, but I also have the expectation that they’re going to challenge me back. I appreciate and embrace when others have knowledge that I don’t. I’ve been told that I’m intellectually confident.

I hire people who complement me versus hiring people who are just like me. I’ve been told by my HR manager that’s a pitfall that a lot of leaders fall into. When she joined the company she was so pleased that I like to hire people who have different strengths than my own versus hiring people who are little mini-me’s.

I lead by example and I work hard. There’s nothing I would ask my team to do that I personally would not do excluding something I don’t actually have the skill to do. When it comes to response time to emails or Slacks, cleaning a bathroom, unpacking boxes, showing up to work in person, which obviously in the fitness business we had to do. Anything that I’m gonna ask my team to do on any given day, somebody would see me doing myself.

The last one is I really value company culture and truly care about our team’s happiness, but also the client’s personal happiness. At the end of the day, that is my gold standard for every decision. 

ATN: Is there anything about being CEO that you don’t like, that you like to delegate? 

Kari Saitowitz: There are certainly functional areas that I don’t love, like accounting and reporting, and I definitely delegate the management of those activities. But the one thing that I really don’t like about being CEO is that I’m the one who has to make the hard decisions that are for the best interest of the business.

I particularly do not like the people-related choices and then the challenging conversations that follow those. The past two years in particular has been full of those really hard tradeoffs and having to have the conversations. Now the irony is that’s the one thing that I would never delegate because I feel like when the going gets tough is when it’s most important to lead from the front. So, I seek counsel.  

My HR manager has done an awesome job. When she first joined I told her the one thing I really wanted help on and to develop better was how to have those challenging conversations. Also, I have a diversity and inclusion officer who’s incredible and he’s a trainer as well. He happens to also have a PhD in developmental psychology and has studied diversity and microaggressions, specifically in the fitness industry. So we sort of have the perfect unicorn under our roof. He’s been a trainer here for seven years. The two of them offer me a lot of support, but I still have the conversations myself. 

ATN: What would be the title of your biography? 

Kari Saitowitz: It would be From Boardrooms and Bubbles to Bells and Baseball. 

I’ve always loved baseball — I was the manager of my high school baseball team and kept the score books. I come from a family with myself and a sister, and sports in general, as spectators mostly, was one of the ways we really connected with our father. I always tell people, I grew up reading the New York Post starting at the back page, and I used to actually stop when it hit the real news. Now I flip over and I read it from the front as well.

I [also] have two sons. They both happen to love baseball. If I’m not at work, I’m probably on a baseball field or talking to the other parents about our kids’ travel programs or helping the kids progress their playing abilities and their skills. Even now working with one of my former trainers who’s got a real passion for youth sports [I’m] kind of helping him on the side with a little test kitchen with one of my son’s baseball team. So basically if it’s not kettlebells, it’s baseball, so Boardrooms and Bubbles to Bells and Baseball.

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