Consumers are changing the shape of healthcare with their choices, giving rise to the new product category of “wellcare,” according to a PricewaterhouseCoopers report released last year. It refers to products and services that help people stay healthy, youthful-looking and in shape.
Fitness, in particular, is a burgeoning segment, and Orange County, with a population that tends to focus on personal health, is home to a growing piece of the pie.
Xponential Fitness LLC, Nifty After Fifty LLC and Stark serve up their own unique menus, ranging from boutique gym concepts to geriatric-focused offerings to healthcare tailored for business executives.
All three have their eyes set on national reach.
The global health and fitness club industry generated more than $87 billion in revenue last year, the U.S. leading all markets at nearly $28 billion, according to a Statista report.
Flexibility
When it comes to stretching, one tends to think of a quick pause before and after a workout. But Xponential’s StretchLab has made the often overlooked activity a stand-alone concept.
“We make time to work out, but we don’t make the time to stretch and recover properly,” said StretchLab President Lou DeFrancisco. He joined the company last year when Irvine-based boutique fitness brands operator Xponential bought the Los Angeles assisted-stretching concept in November.
StretchLab, which has a location in Santa Monica, Venice Beach and Beverly Hills, recently opened its first OC site in Laguna Niguel last month. DeFrancisco said the latest serves as a model for interested franchisees, and that while it’s hard to replicate the vibe of the L.A. locations, the Laguna Niguel site is part of a traditional plaza with anchors including Albertsons and CVS, “more the traditional strip mall that you would have.”
Each is about 1,200 square feet and has 10 benches. Customers start with a consultation followed by stretching with trained flexologists who guide them through a series of stretches designed to improve range of motion and flexibility. Every stretch can be customized.
Flexologist Austin Martinez at the Laguna Niguel location said, “Stretching on your own is static stretching, which can only get you so far.”
StretchLab provides proprioceptive neuromuscular facilitation—a “push and release” method of stretching, according to Director of Education Brad Walker—that it says allows for deeper stretches than people can get on their own.
The company offers 25-minute and 50-minute, one-on-one, personalized stretching services. It’s also introducing flexologist-led group stretch classes. Monthly membership is available for four or eight visits per month.
“Fifteen years ago, there were people out there who wanted to find their own fitness and wellness path,” said industry veteran DeFrancisco. He said boutique gym concepts have grown significantly, such as yoga, Pilates and cycling, but that he considers dedicated assisted stretching and group stretch classes fairly new, with lots of room for franchise growth. He said the Laguna Niguel location has already signed up over 300 members.
It signed franchise agreements to open 31 locations in six states. DeFrancisco said he plans to sell an additional 200 locations next year.
Xponential currently owns a portfolio of five verticals: Pilates, cycling, rowing, dance and stretching. Each brand functions separately and has its own team with a president, chief marketing officer, real estate director, construction project manager and sales force.
DeFrancisco said, Xponential plans to acquire additional concepts and eventually roll out XPass, which will allow customers to experience all of its fitness studios via a flat-rate monthly subscription.
Personalized Care
“Our clients are often the most intense ones, the overachievers,” said Stark co-founder and President Todd Vande Hei. The Irvine-based concept, its name means “strong” in German, provides a one-stop shop for fitness and health.
Stark customers are paired with a team comprised of a personal trainer, a nutritionist, a performance medicine specialist, a neuromuscular specialist and a program designer. The goal is to create a health and lifestyle plan that fits individual client needs and goals.
Vande Hei, who was previously president of carpet and rug manufacturer Dixie Group Inc. (Nasdaq: DXYN), said he was once living the lifestyle of Stark’s primary client population—executives who “work too hard, drink too hard, travel a lot, and pretty much sit around all day [and] energize with a lot of caffeine.”
He said its offerings, including training, nutrition, chiropractic care and acupuncture, aren’t new therapies, but Stark puts them under one roof in an integrated package.
Packages range from $1,200 to $2,400 per month.
Dr. Alice Nguyen, a performance medicine specialist at Stark, said biochemical factors significantly impact performance and that routine testing is part of comprehensive care. She typically performs three to five tests on new patients, spending about an hour on intakes and another hour on follow-up appointments.
Stark offers blood tests, IV therapy, hormone-replacement therapy and regenerative injection. It also provides cryotherapy, which refers to exposing the body to cold temperatures for a short period of time—similar to applying ice packs—as well as cold-laser therapy, functional taping and wound care, and cranial facial release to restore normal respiratory function.
“The way that healthcare is right now is going to tank our country,” Nguyen said. She added that most clients seek out Stark for comprehensive care.
Vande Hei said the original gym in Costa Mesa, owned by former partner Brad Davidson, was “a small gym with old equipment and one and a half employees, including myself.”
The company repositioned itself in 2011 including a name change. Vande Hei bought out Davidson in 2016 and now owns 100% of the company. It employs 23, including three doctors, at its 7,200-square-foot headquarters. It’s hiring administrative personnel and trainers.
It generated $2.5 million in revenue last year, up about 40% over 2016. Vande Hei said he plans to open two more locations next year, including one in Newport Beach in January. Stark currently has 250 members.
Seniors Segment
Weight training for the general public is a relatively recent development—in the 1980s, weightlifting was largely limited to bodybuilders. That’s changed dramatically in the past couple of decades and now Nifty After Fifty is focusing on strength training for seniors.
President and Chief Executive Michael Merino said founder Dr. Sheldon Zinberg started the fitness concept in 2006 to help health plans, medical groups, accountable care organizations and hospital partners better manage the 50- to 70-plus-year-old population by helping them stay active.
Zinberg has over 50 years of experience in the healthcare industry, including 35 years in private practice. He founded CareMore Medical Group in 1993. CareMore is a subsidiary of Anthem Inc.
Merino has over 25 years of experience in the senior healthcare sector, including previously holding chief executive roles at Sterling Healthcare Management and South Indian Health Council and vice president and chief operating officer roles at CareMore Medical Enterprises.
Zinberg later created Fullerton-based population health management company Encore Wellness, adding Nifty After Fifty to the company’s wellness offerings. Branding programs target “full-scope wellness and independence,” according to its website, and it’s aligned with health plans and care providers to keep seniors healthy and reduce the cost of delivering care to them.
“A [Nifty After Fifty] gym is designed from the ground up for seniors and those with chronic illnesses,” Merino said. Programs are available for conditions including chronic low-back pain, chronic obstructive pulmonary disease, congestive heart failure, hypertension and diabetes.
“The facility is laid out with that in mind, with every piece of equipment selected for seniors.”
The centers, for example, don’t have treadmills because of the risk of falls, instead using recumbent bicycles and steppers. Weights are filled with air pressure instead of made with steel to prevent potential injury to connective tissues and joints.
The company has partnered with senior-health insurance companies, including CareMore Health Plan, Monarch HealthCare and TexanPlus. It has 31 centers in five states, including OC locations in Brea, Anaheim, Laguna Woods and Santa Ana.
“We have grown organically as we refine our model,” Merino said.
He said 70% of its undisclosed revenue comes from health plans and 30% private pay—$39 per month—and that it plans to grow by securing contracts with additional health plans. In addition to specially trained fitness coaches, Nifty After Fifty offers physical therapy and such as diabetes prevention, “brain aerobics,” computer-simulated driving exercises and neurodynamic fitness training.
Aging involves physical and mental deterioration, the former starting at age 40 and declining as much as 1% every year—the latter at age 35, according to medical research.
It has 175 full-time employees.
