This Founder Created a Billion-Dollar Fitness Brand Using Communication, Teamwork, and Community. Here are His Secrets to Building a Franchise That Stands Out Opening up a franchise? Orangetheory's founder explains four steps to help differentiate yourself in a saturated market.

When Dave Long launched Orangetheory in 2010 with his two co-founders, Ellen Latham and Jerome Kern, one of his first thoughts was: How are we going to scale this concept to franchises?

"Because the product resonated so much with early-stage customers, there was a lot of energy and confidence — maybe even overconfidence — that if we could figure out the operating model, we [would have] a really high chance of success in franchising," says Long.

All three founders wanted to create something that was special for franchise owners — something they could be proud of.

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"We took it very personally," says Long. "Somebody was signing up and putting money, their time and their life behind a brand, so we really wanted to prioritize their success. "

Now 13 years later, Long reflects on some of the key factors that helped him and his partners propel Orangetheory into a billion-dollar brand. From using data and creating a culture of optimization and collaboration to building a strong team and fostering community, here's what Long had to say in his own words.

Long's answers below have been edited down for length and clarity.

Use data and create a culture of optimization and collaboration

There's running the business, and then there's optimizing. I think where we did really well was in creating that culture of optimization and collaboration. [In other words,] there's a lot more communication. Even in the early days, we had Slack channels, phone calls and in-person meetings, so feedback is constantly flowing. We spent a lot of time observing, talking and boiling down core areas of improvement.

There's going to be a lot of ideas thrown around, but what is really beneficial for the business? What can be scaled? I think if you're a franchisee, be comfortable [with] being vocal, especially if you're part of an earlier brand. When I think of mid-or-late-stage franchises, it's about having a process and a framework in place to take in new ideas to test and learn.

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We leverage our corporate-owned stores to test and learn, but a lot of times, we'll do that simultaneously with franchise partners who are willing to test in a controlled enough way so we can validate the data.

[But there comes] a point where you can't optimize and change constantly. It becomes, "Okay, now we need more of a funnel of how the ideas flow in." We use a Franchise Advisory Council to do much of that now.

We get input directly from franchisees, but a big chunk of it flows to the Franchise Advisory Council and the subcommittees on different areas of the business. [That's] where you have people who are willing and able to spend extra time talking through [ideas], debating and then testing and learning on what will ultimately make it or not.

Build a strong team

We've invested now for 13 years in finding the best coaches in the world, providing a really great place for them to be and then continuing to develop them to be better and better.

It's one of the most difficult products to lead and execute at a really good level — [so we put more emphasis on recruiting and sharpening what makes an amazing coach].

Because we have that foundation, it's allowed us to innovate and provide variety with the brand. The way the workout changes each day but doesn't depart from the science of it — you're still getting the results even though you're not doing the exact same thing.

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Focus on community

Every studio has its own community where the members are supported and the coaches support the members. The biggest challenge for people [making] exercise a lifestyle is keeping their habit.

So if they're going to be traveling, and they stop working out, [they may stop altogether]. That's one of the biggest reasons people fall off of their exercise routine. So as we continue to grow and expand, the goal is just [to help] people stay consistent.

When I think about Orangetheory or [other] service businesses, I think [the] community is really important for all of them — especially for ours.

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The majority of folks who come to Orangetheory and try it for the first time are via referral. You love Orangetheory, you're always talking about it and finally, you get me to go. But I've already learned a lot about it from you, and you're trying to make me feel more comfortable. I'm still probably intimidated, but it's like that tipping point. Then the coach welcomes you and shows you how all the equipment works. And that coach, when it's your first workout, is spending the bulk of their time with someone who's brand new — and so that's where the community aspect comes into play.

They love the brand, they love being part of it and they just naturally want to help other people be successful because everybody started at that point. That's where I think, for us, community becomes such a big part because it naturally kind of proliferates throughout each studio.

It [has] created this really positive flywheel of happy members sending a lot of positive feedback up to staff and franchisees — which creates a ton of motivation for the brand to continue to flourish.

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