How Chuck Runyon, the Cofounder of Anytime Fitness, Built 4,000 Locations
Listen to Chuck Runyon’s segment here
00:03 Speaker 1: Get ready for all the craziness of small business. It’s exactly that craziness that makes it exciting and totally unbelievable. Small Business Radio is now on the air with your host, Barry Moltz.
00:15 Barry Moltz: Well, thanks for joining this week’s radio show. Remember, this is your final word in small business. For those keeping track, this is now show number, incredibly, 571. This episode’s provided by Nextiva, the all-in-one communications platform for your small business. It’s also sponsored by LinkedIn, the place to generate leads, drive traffic and build your brand awareness. For free $100 credit to launch your campaign, go to www.linkedin.com/SBR. It’s also supported by efile4Biz, the easiest way to electronically process, print, mail and file your 1099s and W-2s for your business. Go to www.efile4biz.com. It’s also sponsored by vCita, all you need to run your business in one software. Try it for free at www.vcita.com. That’s vcita.com and use Barry10 for an exclusive discount. We’re also sponsored by Blue Summit Supplies. Get your W-2s and 1099 tax forms that your business is required to file. Go to www.bluesummitsupplies.com/SBR and use code SBR10 at check out to save 10% on your order.
01:25 BM: Well, one of the things that we all work on now is how to become better leaders. Unless we can lead a team, we can never ever get the leverage to build a big profitable company. My next guest has done just that, building a company that has over 4,000 franchise locations in 50 countries. Chuck Runyon is the co-founder of Anytime Fitness, an alternative to big box gyms, which typically feature expensive frills that few members actually use or need. In contrast, Chuck and his partner design smaller neighborhood clubs featuring the things members wanted: Convenience, affordability, quality equipment and surprisingly personal service in a friendly non-intimidating facilities. Chuck, welcome to the show.
02:06 Chuck Runyon: Thanks, Barry. Congratulations on show 571, that’s very cool.
02:09 BM: Well, congratulations on 4,000 franchises. Where did the idea come for Anytime Fitness?
02:15 CR: Well, the first one we’d say it’s actually closer to 5,000 now since it opened and actually we just got back…
02:19 BM: Wow. You can’t always believe what you see on the web, I’m surprised.
[chuckle]
02:23 CR: That’s right. We just got back from Antarctica.
02:25 BM: Wow, I saw that.
02:26 CR: And so we are the first franchise brand in history to operate on all seven continents.
02:30 BM: Wow, congratulations.
02:31 CR: So I’m very proud and quite excited about that. Thank you very much. And we started in Minnesota in May of 2002, so it over 17 years ago now.
02:39 BM: Wow, and so where did the idea come for it Chuck?
02:43 CR: Well, my partner and I were in the fitness space. We owned some of the bigger box stores, those with racket ball, whirlpool saunas and they had 40 to 50,000 square feet with daycares. What we realized is that most of our members just came in every day and uses their cards as a cardiovascular and the strength equipment, and so we wanted to create a more efficient gym that was far more convenient. Your closer to home, closer to work and open 24 hours where our members could come in whenever they want. And so we came up with the idea for Anytime Fitness which is more of a boutique-sized gym. Instead of having a 50,000 square feet, they were 4,000 for 5,000 square feet. And it would be located in a typical strip mall where you would find a coffee shop and a sandwich shop and a dry cleaner, and so it was very close to home and work. We enable technology to get members 24-7 access. And then we began franchising using other people’s passion and capital to grow this around the country back in 2002, and obviously, it’s been a wonderful success. In the industry, it continues to grow too and so at the end of the day, it’s just about unlocking that convenience for our members.
03:41 BM: You know, it’s interesting because we talked too earlier this month with Rohit Bhargava and he talks about the trends that are coming down the line and one of these talks about is revival. There are people who are going back to things that were simpler. And it seems that Anytime Fitness is really a simpler time when it was a smaller gym. And just like in your home, you go work there any time you want.
04:01 CR: Yeah, you’re gonna find all the equipment you find in a big club but in a smaller setting, therefore, it’s more convenient, it’s more comfortable, it’s less intimidating. And because of our passionate local franchisees, they’re gonna take the time to care for you, help you through the program, help you see progress, make it a more enjoyable experience. And so it’s really a smaller gym with big equipment and big hearts because we care for our members unlike any other fitness brand out there.
04:27 BM: What’s the niche do you think that you fill with Anytime Fitness compared to someone going to a larger club or perhaps someone getting equipment in their home?
04:36 CR: Yeah, I think it’s the care and the coaching connection that you get with our clubs and so everyone needs a little bit of a coach, someone to nudge them towards proper behavior or someone to congratulate them on their achievements. And so you get that coaching aspect, someone who help educate and motivate. You get someone who cares about you because behavior changes hard. You and I both know, it’s difficult to make a consistent disciplined effort with your exercise or nutrition, and so therefore you just need some on your corner who can provide some education, some coaching, some caring. And then with some of our group workouts, there’s a community that fosters in the gym and so that caring and coaching and connecting is so critical to help our members achieve the healthiest version of themselves, that’s why our tagline is, “Let’s make healthy happen,” because with a coach and a member, they can get that person to the healthiest version of themselves. So everyone needs a little bit help.
05:24 BM: Chuck, one of the things that you always focus on is to help entrepreneurs really become better self-aware leaders and I try to emphasis this a lot because if you’re not a leader, if you can’t lead people, you’re never gonna find any leverage in your business if you’re always doing it yourself.
05:38 CR: Oh Barry, you are so correct and keep in mind that now over the last 17 years, I’ve had a court-side seat to small business leadership. I have seen franchisees go from one club to now over a hundred clubs. And then I’ve seen other franchisees who aspired to have more, but they just can’t grow and leverage their business. And you are 100% correct, it really comes down to how good you are at attracting, in engaging, in leading your team, and what good leaders understand is that leader builds the team and the team builds the business. You gotta be able to like surround yourself with really talented people, empower them with the autonomy, the vision and the resources to grow and you have to trust them. And so yes, there are better owners who can scale their business. They understand they’re not in the fitness business, they are in the people business, and so that is so critical.
06:26 BM: You know, let’s go through some of your five lessons. One is that mindset matters. Get in tune with your emotions. Some leaders would say is you gotta check your emotions at the door when you run a small business ’cause it can’t be personal.
06:38 CR: I disagree. We feel so much emotion in the workplace. We’re laughing. We’re showing love. It’s okay for us to be vulnerable and say that we’re stressed, or we don’t know the answer. So I think we put so much energy and time into the workplace, I think it has to be emotion ’cause we want to engage our team’s heart to every bit as we engage our mind. So for us, it’s okay to cry at work because the work means that much to us, and we’re changing people’s lives, and so mindset matters. We’re in the business where if you work out, your biceps are gonna get bigger, or they’re gonna get stronger. And mindset is a muscle, just like your biceps, and so you’ve got to challenge it, or you’ve gotta add a little bit more weight. And you’ve gotta continually practice at it, and you have a stronger mindset; the one that’s more resilient, more optimistic, and you’ve gotta constantly work at your… As an entrepreneur, you can’t have a weak mindset. You’ve gotta have a growth mindset, and you’ve got to stay resilient, positive, and hungry to learn more.
07:31 BM: You know it’s so funny ’cause I had a trainer years ago, where she said, “Listen, we’re gonna get your body right, but you also have to get your mindset right.” And I didn’t understand that for a lot of years to come.
07:40 CR: Well, we always say that the body will achieve what the mind believes. As an entrepreneur, it’s the same thing. The business will achieve what your mind believes, what the leader believes and so, at the end of the day, as a leader, you can’t really afford too many off days. You always have to be onto your team. You’ve gotta provide them the energy, and the inspiration, and the direction to be the very best that day. And so you need to know what makes you tick at a high level. Like for me, I need to get in my morning exercise. Also, because I’m a bit of an ambivert, I need a little bit of quiet time in the morning to make sure I’m charged up for the day. I need regular feedback, and so… And then I also need some type of creative outlet that day to operate at my very best, whether it’s whiteboarding, whether it’s writing. And so because I know myself, and I know what makes me tick at a higher level, I can make sure to put those into my day, so I can be the best leader possible for my team.
08:30 BM: Chuck, you talk about seeking trusted feedback. I think that everybody needs feedback. There’s a couple issues associated with that. One is: Who can you get trusted feedback from, and they’re just not mouthing what you think they wanna hear, and how do you know if you should really take it in or it’s just someone that really has an ulterior motive?
08:47 CR: That is a great question and, again, another thing I’ve seen in small businesses, right? A small business doesn’t have a Board of Directors. They have no one to, that they can hold them accountable, that they need to report to. So I’m always suggesting to our small owners, even if you have one club or 10 clubs, build a small board from within your community, from other leaders in the business that you respect. Maybe it’s someone like a banker that you’ve done business with or a mentor in another field. And again, ask them to get together regularly and, again, they’re going to help you. They’re gonna kinda be your Board. They’re not only gonna give you feedback in the business, but also give you feedback in yourself. There are plenty of organizations like YPO, or I’m sure every community now has some business organizations where you get together in a round table setting with peers, like yourself. They might be CEOS. They might be people in marketing. They might be those who own businesses like yourself. And the goal of those type of groups are to give each other feedback, to hold each other accountable. And just make sure you are creating a circle, a network of people who are willing to have the courage and honesty to give you feedback on what you’re doing well, that’s important, as well as areas to improve.
09:57 BM: And they don’t really have any ulterior motive by not telling you the truth, right?
10:01 CR: They don’t. Obviously, you’re getting feedback from the business metrics, you’re getting feedback from your team, but you need some objective outside resources, those who are not monetarily tied your business. And there are so many business and successful leaders in your community who are just waiting to be tapped into, who want to mentor, who want to help you succeed and then fill… You can’t sit there and wait for people to give you feedback. You have to go out and seek it. You’ve got to tap into some people who have been there, and done that, and are willing to help you, and there’s more than you think.
10:33 BM: Another principle you have about being a better leader is practice self-disclosure. And I think those three words are very powerful because, one is, I think to really be an authentic leader, you’ve gotta show vulnerability, but I think you also have to practice it because you don’t have to tell them everything.
10:49 CR: Yeah. Look, I think there is great power in vulnerability. There’s really no learning until you’re ready to be vulnerable to admit that maybe you’re not good at something, or you failed at something, or it’s just not your best work, and you need help. Once you’re willing to admit it, once you’re willing to seek help, that is where personal growth starts. Dave, my partner and I, we are not college graduates.
11:14 CR: We started this idea 17 years ago, but the company is vastly different today, with nearly 5,000 units, globally, and the times are different. Think about how much we changed here in this digital transformation we’ve gone over in the last decade. So, this company requires a different set of leadership skills and capabilities than what we had 17 years ago. So, for us, it’s been a non-stop evolution of trying to grow and trying to build some self-awareness and trying to build new leadership and communication capabilities. So, we’re always trying to learn, and so that’s really the quest for all of us, is how much potential do we have? How much can we tap into that? How can we learn more about ourselves? So we are always trying to surround ourselves with smart people, we’re asking questions, we’re seeking feedback, we’re willing to be vulnerable and just say, “Look, we’re not very good in these areas. How can we get better? And so it’s really been 17 years of vulnerability, but now that we know this, how do we now get better? And so for us, we’re just, we were an everyday student trying to learn.
12:09 BM: Chuck, how do you figure out how vulnerable you should really be to your staff? ‘Cause, again, I think it’s important to be authentic, but at what point does it become TMI, too much information, that they don’t need to know something like that? In other words, you can’t always come in every day and just spill your guts.
12:26 CR: Yeah, I think that’s a good question. I think it’s just, like you said, as a leader, you still wanna instill confidence, instill competence, like you know what you’re doing, but it’s just okay to pepper in some, hey, here are some areas of the business we’re not doing well. Here’s some areas where I’m trying to improve. I don’t necessarily know what the ratio is. Maybe it’s an 80-20. You just wanna do 80% of confidence and competence, and maybe 20% of areas to improve or vulnerability. You don’t wanna do it too often, but at the right place and right time. It’s a little bit of a situation awareness skills where you’re gonna instinctively build over time. Your team needs to know that you’re human. Your team needs to know that you care, and so if you show some emotion… When I cry because one of these member success stories changes their life or when I get a little bit stressed about something, I’m just being human. I’m just showing that I really care about the business and about the people. And I don’t know if I’ve got the exact formula, but just use your situation, use your instincts to know that, “Hey, my team could use this right now,” versus “Hey, now they need a jolt of confidence.”
13:28 BM: Because in the end, your team is going to mimic whatever you do, so if you show vulnerability, your team’s gonna show vulnerability, and that’s a good thing.
13:37 CR: 100%. We want real authentic people working. And you mentioned that word authenticity. We want people to bring their full self to work. We want them to show up, share their point of view, be real, no bureaucracy, no bullshit, none of this office politics. We’re all human. We’ve all got great intent. So, we really want people to feel comfortable and safe, so they can bring their full self to work. We love that word authenticity. An so therefore, a leader needs to be authentic to lead by example and instill the culture.
14:08 BM: I love your fourth principle ’cause you say, “Know your team and build them up,” and you quote that 79% of employees quit due to lack of appreciation from their leaders. And I really think that’s true. I don’t think folks quit their company, I think they quit their boss.
14:20 CR: That is so true. I think you know of stats. Gallup has been testing employee engagement now for 15, 20 years, and 70% of people drive to work each day, either feeling emotionally neutral or is unhappy with going to work. I just think that stats is so sad and miserable, to think that seven out of 10 people devote half their waking hours in something they don’t like to do. And so employee engagement, for us here, is very critical. We want you to show up at work engaged, ready, and emotionally involved in the work. And so we wanna make sure we’re providing constant feedback. And more often than not, we’re looking for things you did right, not things you did wrong ’cause we want to instill and reinforce the good habits and good behaviors of our culture. So we’re always looking for leaders who are coaches, not cops. If you’re a police officer, you look for things that are going wrong, but if you’re a coach, you look for things that people are doing right. For us, that’s at least three-to-one, and we’re trying to say, “Look, great job,” and reinforce that behavior throughout the culture. So just remember, as a leader, look for what they’re doing right more than look for what they’re doing wrong.
15:26 BM: And again, your last one is you have to measure your growth, is that somewhere along the line, to be a great leader, you have to be reflective. And I think that too many times, Chuck, we’re moving so fast as leaders, we don’t take the time to be reflective. Why is it so important?
15:40 CR: Oh, I think it’s critical. I write. I’m a writer so, for me, writing things down is very cathartic. It makes me really think about the business in a more strategic way. Oftentimes, I send out all-staff letters. I send out Board letters. Writing really causes me to reflect, and you’ve gotta take the time to… The pace of business is so dizzying these days, and so it’s like, get off that merry-go-round, stop for a second, elevate your thoughts, and zoom out, and think about, alright, what’s happened here in the past? What is the present state of the business? Then really zoom out over the next two years, four years, six years, on where this business is going. Your team needs to know what you’re thinking as a leader. They need to be thinking about your vision. And in today’s society where we’re just inundated with information, a leader cannot communicate often enough. So when I take the time to reflect, I want to share those feelings, and you’ve gotta repeat yourself, numerous times, whether it’s through email, whether it’s through all-staff meetings, whether it’s through some videos.
16:39 CR: I mean, especially when a business is growing, you just gotta continue to communicate and beat the drum of what’s our vision? Who are we impacting? Why are we doing this? How are we doing this? Why is that important? How do we behave? And if we’re successful, how do we impact people or the planet? Your team can’t hear that often enough.
16:57 BM: So the last question is, given you now have 5,000 franchises on every single continent, what’s the message that you’re going out with your team this year?
17:05 CR: For us, it’s funny you mentioned it, we are still grounded in our values. So, despite our growth, we have four core values around here, which is around people, purpose, profits, and play. So, every day, we wanna make sure that this formula informs our strategy. Is it impacted into our behavior? And really, for us, it’s about outcome. It’s about investing in people, having a purpose bigger than ourselves, making sure we’re helping franchisees create profitability, and then having fun. Right? Taking the work seriously without taking ourselves seriously. So, no matter how big we get, we are still grounded in our values. We are not gonna allow business growth to change who we are, and that is the integrity that is the soul of our company. And we’ve gotta continue that as a foundation. We’ve gotta continue to nurture that, and that cannot change. We hire for that. We reward for that, and we talk about it. Those values are critical, and they should be felt in every corner of our organization.
17:58 BM: Well, Chuck, I appreciate you being on the show. If you want more of Chuck’s advice, you can get his book called “Love Work” and you can go to www.anytimefitness.com Chuck, next one is gonna be on the Moon or Mars, or what’s the next thing to accomplish?
18:12 CR: We are working on it, my friend. We’re gonna be the first to be on a space station, the first to be on another planet, or who knows? Maybe we’ll go underwater. Maybe we’ll go somewhere deep in the ocean. It’s a work in progress. We’re not done.
18:22 BM: I’ll look forward to that. This is AMA20 WCPT in Chicago. We’ll be right back.