Episode #550: Lessons from AFAA to Telefitness-Michael Pesta on Fitness Industry Innovation

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This is Pete Moore on Halo Talks NYC. I have the pleasure of having

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Michael Pesta who has been in the Halo sector previously,

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then when it did a little rant in the entertainment industry

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successfully, and now he's on his way back, telehealth beaming

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back to us. So, Michael, welcome to your first Halo Talks. Thank

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you. Thank you so much, Pete, for having me. Awesome. So start off,

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and tell people, you know, how you originally got involved in

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AFAA, which, which at the time was one of the largest fitness

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education brands, what you did there, and we'll kind of, fast

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forward from there. Sure. Not a problem. Well, actually, I was a

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struggling actor back then, and I came there just to help them

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move some boxes. And before I knew it, there was a

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handful of women, really. I was the only guy in there.

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And, just went from, that was

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in I'm showing my age now, but back in the mid

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eighties. So, from there, I actually ended up being

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the director of membership, make a long story short,

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became this, created a telemarketing division for

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them. And that telemarketing became the mainstay for the revenue.

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So we built it over time. We put it into about

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73 different countries, but it you know, over that time,

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it was the first of its kind. So we were the first

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really setting standard and guidelines in fitness. I was able to get a front

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row seat to that and able to when I left,

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I I left, after about twelve or thirteen

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years, and I was, on the board of directors,

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senior vice president of both the sales and the marketing. But more

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importantly, we were able I was able to be a part of something

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that was really a movement back then. And it would it

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took off, and it just you know, we're just trying to keep up with it

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really, but that's how I got started just by moving

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boxes. What were you guys what were you what was the what was the

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core, playbook for AFAA

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at the time? What what were you offering certifications in?

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And, you know, given that our industry, I would say, on

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average, is probably not the the the fastest one either to

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embrace technology or to embrace education.

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You know, what what were some of the takeaways from that or some

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of the things that you were, positively, you know,

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recall from from those, you know, memories, if you will?

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Yeah. So the takeaway on that would be

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that when you're the first into an industry

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and nobody's done it before, you get a chance

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to see the hurdles that are in front of you. There was

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a lot of challenges that there was,

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back then, the technology was one eight hundred.

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Okay? And so we had what these things call a t one. So we had

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a lot of, you know, technical things

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back then, but it wasn't so much as we look at it today, but it

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was phone systems and being able to route

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calls and so forth. So as we grew, I hope I'm answering your

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question, part of part of the struggle there

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was figuring out even technology back then, how to route a call to the right

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person sitting at the desk. But we were,

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new to the industry as far as education was concerned, And the

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what stood out was that we got together with

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Reebok. So Reebok back then was you know, they were the

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big players, and we made a deal with them that we'll

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put Reebok shoes on all the instructors who were

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at that point, millions every day.

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So that was our that the takeaway on that was you

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can integrate and cooperate with others in the industry,

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even though you're new to it in many ways. So I think that was

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my big takeaway would be Reebok with it. And and if you take a

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look at what what people like Reebok or what Nike

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are doing today, like, Nike, you know, has got a deal with a group called

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Fit Labs where they're doing Nike running centers. You've got, you

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know, Reebok that used to have a huge partnership with CrossFit. That

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seems to be kinda, like, been wiped off the Internet. I don't know if you

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if you saw, but they used to be some awesome CrossFit and Reebok commercials,

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which no longer seem to be available. But but they

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obviously spent millions and millions of dollars. You know, where do you see

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companies like that getting comfortable on the education or

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actually using their brand in the industry? And, you know, do

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you think they're they're a little bit naysayers coming into the industry, some of

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them maybe had had good, you know, success in relationships,

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some of them maybe were licking their wounds? Yeah. I

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think, you know, if the today

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as far as today is concerned Yeah. I've really been

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looking at how they're doing and so forth. I do know

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that they're you know, I do see some of their labs some

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some because of COVID have closed down as far as the the

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studios themselves. The education part,

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has been, from my understanding,

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was always there. It may be not as prevalent as it used to

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be, but Reebok, used to have a lot of different types of

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programs that it produced for fitness instructors or

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fitness enthusiasts to put their shoes on. And Nike itself

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seems to certainly be out there in many way. Very

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influencers, celebrity driven product

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today. But education, you know,

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seems to have been kicked around a little, over the years,

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and I'm not sure where they're really landing today with the education.

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Gotcha. Gotcha. So so talk about, you know, when you left the industry and

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when you went into, entertainment. Okay.

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So, you know, like anything else, right, I was,

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after twelve years, I was in my mid thirties by

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then. And after putting it into working

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really sixty to eighty hours a week. We were working a lot back

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then. I couldn't get out of my car one day, to be honest

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with you. I just couldn't couldn't do it anymore. And I

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put a call into AFA, and I said I can't you know,

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I'm taking a few days off. And I went to this place called

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Esalon, which is a place up north where it's you know,

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where you can get away, but it had a meditation hut. Take a long story

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short, I sat in that meditation hut for for days, and

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then finally, I sorta came out with a clear picture. I wanted to go

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make films, and that's what I did. I put my resignation

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in, and I started to go making

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films. So I became an independent producer.

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I worked for, different companies. I

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was I produced family films like soccer mom.

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I did music as well. I was a music

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producer. A lot of acquisitions. But more

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importantly, Pete, it gave me the background

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for production. So I learned every aspect of production from writing,

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directing, producing, delivering, and so forth. And

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so that's when those days back then

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were really, you know, make

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a film, go go to go to video. Right? The blockbusters of the

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worlds and so forth. And one of the clever ideas I

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had because of Reebok with Apple was we put,

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my producing friend there, we put Ladies

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Home Journal into carrying our our

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products. So Okay. That worked with,

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marketing as far as strategy is concerned. But then I saw the online

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coming in 02/1516 into our

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industry, so that's why when I left and came back again.

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This is Pete Moore. I wanna let you in on a little secret. There's this

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company called Promotion Vault, and what they do is they give out rewards

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from retailers that allow you to incentivize your

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members without having to do zero down and one month

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free or giving away shakes or giving away t shirts. What

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you wanna do is build a rewards program that lasts, that

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people value, and that doesn't discount your own products and services.

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So here's the deal. There's something called rewards vault. The rewards

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vault is going to allow a member to set up their own profile.

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They are going to answer questions. You are gonna get those answers. You're gonna be

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able to target those members, and you're gonna reward them inside your

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club, inside your spa, and outside of the club, and

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outside of the spa to get them to become loyal, to get them

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to pay their monthly dues, and to be rewarded

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properly for the actions. A lot of companies are cutting back on rewards.

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You shouldn't be. Promotion Vault's your answer. Trust me. This is

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real.

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When you came back, what what what is there anything that distinctly

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changed? You know, I got into this industry back in February,

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And some of the issues that I had then, you know, I still

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have now in twenty twenty four, twenty twenty five, which are, you know,

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there's not as much of an appetite for hours

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being allocated towards education. People, like, actually wanna

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learn the financial aspects of the business and other

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aspects of the business that are maybe outside of their, like, core day to

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day, you know, domain. If I'm a personal trainer, there's no reason I

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shouldn't have the business acumen to understand how the whole club works. There's

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no reason why I shouldn't understand what the, you know, financial

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economics are of building a location. Because at some point, I'm gonna get the

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itch to potentially do that myself, or maybe I might convince

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myself that that's not something as an entrepreneur I wanna do or put

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my, you know, risk risk what I'm doing personally

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as, like, doubling down on my job. Right? I'm I got a business that

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now depends on me, and, also, I got investors that

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depend on me. I've got debt that depends on me to pay them back. I

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got landlords. You know, things get much more complicated. So have you

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seen any cosmic shift? Are you more inclined

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to be excited about what you're doing as we get to telefitness

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because of, like, the the background on some of the people that are now in

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our industry and the technology, you know, savviness versus what

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what it was thirty years ago? Yeah. No. It's a good question.

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Yeah. No. I'm very excited about it. And what I've been able to see is

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that what brought me forward or or back into this industry

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is the, you know, the entrepreneurship

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for personal trainers today. The education

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still needs to be coming forward because what we're

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doing with when we first started certified personal

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trainers, there were have always been those who wanna be entrepreneurs, and they

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want to do their own thing. And I think the online education

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today is starting to direct them towards that way.

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But more importantly, we're creating now new,

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tiers for them to, educate themselves. In other words,

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specialty programs are there now. They're just, they're not just counting,

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you know, sit ups and telling people how to just to lose

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weight. They're going above and beyond that with specialty programs.

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And today, one of the roles that we're creating

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through classroom trainer, a company I have, is the medical

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personal trainer, which will elevate them to interact with,

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the health care industry more. So I hope I'm answering your

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question where Yeah. Yeah. Education, is

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still evolving. The personal trainer role is still

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evolving, and them seeking out education to be entrepreneurs

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is sort of interacts with what we're doing with

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telefitness. Gotcha. You know, and and let let let's

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talk now about, you know, telefitness. As you think about

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it as, you know, a a solution,

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what are some of the things that you

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deem that has been successful in telehealth that could be overlaid into

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telefitness, and and what frustration did you find

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that that this is going to solve? Okay. So good

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question. So we you know, one of the things we see,

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first of all, with telefitness as a mission, so to speak,

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is that we're going out there to be no

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different than after to be the world's largest of what we do because

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I'm in the position with the relationships we've been able to

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gather. The hurdles have been, you know, at first, like,

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well, now we gotta go get the trainers. Well, we've absorbed about

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50,000 trainers on the sideline right now that we

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can incorporate. So to bring it into a tele

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mode, meaning a platform that will interact properly,

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is, something we're doing right now. We're vetting the the the

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groups, for that. So there's a hurdle

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there because you've gotta pick the right because we

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wanna be that sample golden approval for the

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not just the fitness industry. We know the fitness industry.

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We have the best of the best to go out to consumer, get

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them to come to us. But what we've never done well, Pete,

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as a as an industry, the fitness industry, we've never interacted

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well with health care. And I in order to do

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that, we had to take telefitness,

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and I gathered leaders in this industry. So it's not just

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myself. I'm leading it at the moment, but we've got together a group

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of people that said now is the time to do it. And

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we're validating them, verifying them, so they'll

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be of that where doctors tomorrow

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will feel comfortable to send somebody once point of patient care is

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done over to Total Fitness. But the hurdle

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spend right now, we got the trainers.

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We're vetting the different companies for the platform,

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which, by the way, is really interesting because you have a

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lot of different players out there. We're ours will be HIPAA

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compliant. People will be able to share notes, so

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forth. So we're getting through that hurdle. And I guess the next hurdle

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is gonna be the finance. I don't you know, we have people knocking on our

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door already, but our next goal would be, getting it,

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into a beta test, which is gonna be in q one, q '2 of next

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year. And tell me exactly

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how the process is gonna work. So I'm a personal

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trainer. And, obviously, there are a lot of companies during COVID

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that tethered themselves to personal trainers. Those companies no longer

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exist. Right. Because a lot of the personal trainers said, hey.

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I'm gonna go direct either through YouTube or through,

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you know, Zoom or through some you know, through through Facebook Live or what

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have you. It started to get on some of these SaaS

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platforms that were basically helping them run their business. And

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then once people went back to the to the clubs, you know, the the

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trainers went back also and said, hey. This is kind of like a nice ancillary

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part of the business, but, you know, I don't wanna just be doing remote.

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So how do you view, you know, the either the ease of use

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or, like, the leverage or the scalability that you're going to be

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potentially providing and how a trainer kinda

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interacts with the tele fitness, you know, platform they're

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building? Well, so far, we've taken a temperature with trainers, and

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I don't think we'll there will be a scarcity for getting them

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to onboard. Right? Because everybody you

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know, we'll be feeding them leads. And so and getting

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them, so we'll have their schedule and we'll fill the appointment for

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so to speak. And we're not gonna just have any trainer just because we have

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access to 50,000 plus. Doesn't mean we're gonna we're gonna

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take the best of the best and we're gonna feed those who

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are and have been through a protocol with us.

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So I think they're you know, if I'm answering your question right,

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the, trainer themselves would be looking to come on board

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because, one, they're now in this club,

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so to speak, that is gonna be interacting with health care as

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well as your regular clients you would, be able to get to the consumer

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part. So I think there's a lot of,

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trainers out there who would love to have this business and get the

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business to them, and we're looking to to do that.

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So so as part of this, like, a lead generation, like, for

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for trainers? So I'm gonna be on your system. I'm getting you're you're going into

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the medical community. You're going into some of the health care,

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insurance providers, and you're basically helping them, you know,

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utilize a personal training platform. So

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one not only is there a reason to get on because you could

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tech you know, scale yourself and your time, but I

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am going if I'm speaking for you, you know, I'm I'm joining

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this platform, and they're gonna send me revenue opportunities and and and

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clients. Correct. That's exactly how it's gonna be.

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And more importantly too, we'll be able to you know, once they have

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a client I used to run gyms. So and I used to run personal

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trainers live. Right? So I knew that that I knew how

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to how that all worked. I think I've had every job that you could possibly

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have in the fitness industry. And Yep. And one of the things that

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they need is is leads. And not only that, but

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retaining them. So we'll have a lot of,

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you know, follow-up. The the good news about

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telefitness is that we will have a system that once the

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the session is over with, the user will get an email from us

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how did the session go. So there's a lot of that going on,

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watching it so that we have the sustainability to

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get somebody to come back. So the trainers will have a lot

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of, actually, webinars we will give them as well

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on how to work with and be online, which is

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completely different, by the way, than being in person. There's a

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there's a there's a, an art to being a virtual

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trainer. Yes. You know, as you take a look at, like,

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what the price point is, do you have an idea of what

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trainers would be willing to pay either on, like, a monthly

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SaaS fee or as a percentage of a new

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client onboarding? Well, to get it started, we're not

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gonna we're just going to create a invitation and

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get people on board. They're not gonna pay anything. There's no the

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trainers were only will only receive x amount

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for their participation. So just like a club, we're gonna do

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a rev share with them. Got it. So they won't

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have to to pay anything.

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This is Pete Moore. Here's the last tip for you of the podcast.

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We are partnered up with a company called Higher Dose, higher dose

323
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dot com. They are the leader in workout

324
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recovery products, infrared technology, LED

325
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light masks, neck enhancers, and other

326
00:20:33,000 --> 00:20:36,700
products such as PMF mats and sauna blankets.

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00:20:37,225 --> 00:20:40,745
If you have not gotten on the workout recovery train

328
00:20:40,745 --> 00:20:44,585
yet, your time and your stop is now. You gotta

329
00:20:44,585 --> 00:20:48,264
get these products in there before these workout recovery and spas end

330
00:20:48,264 --> 00:20:52,029
up saturating your market. Having your members walk out of the club and

331
00:20:52,029 --> 00:20:55,470
going into one of their locations for $200 per

332
00:20:55,470 --> 00:20:58,990
month where they're paying 39 to you. Let's become an

333
00:20:58,990 --> 00:21:02,669
expert in workout recovery if we are already the authority in

334
00:21:02,669 --> 00:21:06,385
workouts. Higher dose, check it out. There's a

335
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wholesale code, and we look forward to helping

336
00:21:09,985 --> 00:21:13,825
you augment your products and services to meet the demands of your

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00:21:13,825 --> 00:21:17,445
members. And, hey, let's get people happy, healthy,

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and sweaty, and the recovery should be just as good as the workout.

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And then from a standpoint of of you building a business, maybe

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like getting into your brain as an entrepreneur, You know, you're talking

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about a q '1, q two kinda beta test.

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You seem like you have a a methodical way

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about building the business, whereas if I'm

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an entrepreneur, I'd probably tell you let me tell you what's happening next week. Let

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me tell you what's happening in two weeks. Let me tell you what's happening in

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thirty days. You seem to have, like, a longer term view on it,

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which is refreshing, you know, to basically say, hey. If I'm gonna build

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this business, I'm not gonna learn everything I need to learn in thirty, sixty, or

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ninety days. I gotta, you know, plot this out. And once

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we're ready, then we'll scale it. So do you have any you

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know, if someone was to say, you know, how does how does Pesto think

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about the business or building a business, are there certain things that

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outside looking at yourself, you'd say, like, this is how, like, I'm I'm

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kinda built.

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Yeah. So the as

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far as working with trainers and getting them wanting to

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participate, you mean? Well, just just like the fact that, like, you're, like, on a

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multiyear plan. You're not on, like, a multi day or multi month, you know,

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road map Yeah. As an entrepreneur. Yeah. So the

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business application for them will be, you know, we will

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have typically what they're used to. In a gym, they'll have

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prepaid sessions that we've already, accumulated

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for them. They just have to show up and do it. But But more

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importantly too that they're gonna be able to you know, there's

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a there's benefits to everything, and and and,

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and one of the benefits is being online is

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it costs your cost down. You're not driving around a lot.

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We're sending you the the business at hand. And

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keep in mind that we're gonna have AI. So we

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have the, once you receive a

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client from us to the trainer, the trainer themselves

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will be able to we they've already been pre

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they filled out an application, the user. So they've already gone

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through, and they're gonna get a client that's already been

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prescreened for the type of training that they do.

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Gotcha. So they'll have those notes there. So we'll and we're gonna

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have different programs for them, how to build their business, you

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know, more importantly. And eventually, we will, but not at

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the beginning, Pete. We're going to refer out to a a

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trainer who's a a a tele fitness trainer at

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their location as long as we can verify where they

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work it at and so forth. Gotcha. Gotcha. So

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in closing here, you know, one, welcome to the halo sector or welcome

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back to the halo sector. If there's, you

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know, prospective, partners that that are listening to

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this or prospective employees or or clients,

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you know, you'll give us your, give us your elevator pitch on, like, what

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what what's the benefit of working with you exclusively in your

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team and why? Okay. So what the

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benefit will be for anybody who's running HR

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departments or, you know, are in the health

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care sector, we, meaning telefitness, will

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be a solution, I believe, for preventive care.

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That's our main goal here right now. So Okay. There are

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HR departments that need their employees to be, you know,

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active, to be alert, to all the benefits that come along

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with being healthy or being fit, we'll be able to get

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in there because many of your people today, whether

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point of patient care is done with with a doctor's office, they don't know where

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to go, we could be that solution. For those who are sitting

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in an HR, in an office, who feel intimidated to go

402
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into a gym or even to talk to somebody about their

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fitness needs, we can do that. And as far as it goes with

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the the the, rest of the,

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basic consumer, you know, they'll have verified

406
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trainers, not somebody online like a YouTube who can

407
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be anybody. This is a verified group of people

408
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who that they can rely on. Awesome. Yeah. Well,

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sounds good. We'll have all the information in the show notes. Look forward to,

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seeing how the beta test go, and I know you're talking to a lot of

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big players. They're in development. So, congrats

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on, on the entrepreneurial move back to this, chapter

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of your life. I look forward to seeing you in person. Thank you so much,

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Pete. Thank you, Dave. Thanks, guys.