Planet Fitness Inc. (NYSE: PLNT) founder and CEO Mike Grondal detailed the company’s history of rampant abuse and claims it misrepresented its financials during a recent interview with controversial right-wing TikTok user X Libs.
It comes after weeks of calls for a boycott of the brand after the company canceled the membership of a Planet Fitness gym goer after he talked about a biological male in the women’s changing room.
Planet Fitness’s policy allows gym members to use the locker room associated with their gender identity. But the policy has led to several high-profile cases of women feeling uncomfortable in Planet Fitness’ women’s locker rooms, and some women and children have reported abuse and sexual harassment at the facilities. Many of these incidents resulted in women losing their memberships, but in at least one case an arrest was made, as previously reported by Benzinga.
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In the 15-minute interview, Grondahl outlined the company’s history and why it was founded. Grondahl launched the gym, noting that the Judgment Free Zone is meant to be a welcoming sign for fitness newbies looking for a place to start. But when he talks about the company today, Grondal says it’s “devastating” what it has become.
“Planet Fitness was like another child to me. And I put my heart and soul into building this company and it’s been pretty much destroyed, you know, lost all respect in the country in the last few weeks,” he said. “There’s no common sense behind it.”
Grondal told the Libs on TikTok that he did not approve of the policies or the response to them in recent weeks. Grondahl sold the company to private equity in November 2012 and lost control. After the sale, he remained CEO until he was ousted after he reported that the chief administrative officer (CAO) and general counsel employed by the private equity firm had pleaded guilty to multiple charges over several years and mistreated minors on several occasions. On two occasions he was a teacher and was found guilty of abusing his students. The CAO left Planet Fitness in 2017.
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“When we went public, most of the board knew that this lead attorney was a pedophile. It’s in the culture,” Grondal said during the TikTok interview.
Planet Fitness’ “culture” includes allegations of widespread abuse at the company.
“It started in the corporate office, this lawyer started abusing employees, then he sexually abused them, now the culture is leading to people doing the right thing being thrown out of Planet Fitness,” Grondal said.
While it’s clear Grondal isn’t a fan of the politics and politicking going on at Planet Fitness on any level, he went on to detail some more allegations that could end up hurting their stock price further. Grondal said, “Their numbers are very questionable,” referring to Planet Fitness’ financials. Grondahl, who founded and led the company for more than a decade, has a deep understanding of the interaction and economics required to open a Planet Fitness location.
“I hope these people are buying short, because the way they report their same-store sales and the amount of units they can say they can put out in America is complete bullshit,” Grondal said.
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About 60,000 people must live in an area to support a Planet Fitness club with 10,000 members.
According to the 2020 US Census, there are currently 650 US cities with more than 60,000 members and only 806 with more than 50,000 people.
Planet Fitness has 18.7 million members in 2,575 gyms worldwide. It will probably take tens of thousands of members or more for it to start making a dent in its bottom line. While this is possible, it is notoriously difficult to cancel a Planet Fitness membership unless you are one of the people speaking out against the company. A brief report from the Bear Cave in January 2023 called Planet Fitness “an illegal billing operation with gyms on the side.” Planet Fitness is down 23% since this report came out.
That doesn’t mean members aren’t trying. According to Google Trends, there has been a 2,800% jump in queries like “how do I cancel a Planet Fitness membership in the app.” Google has flagged “How to cancel my Planet Fitness membership” as a “breakthrough” trend, noting a recent increase in search results for this query.
Towards the end of the Libs video, TikTok account owner Chaya Rajczyk said there had been “massive cancellations”, although nothing was confirmed or substantiated.
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This article Planet Fitness ‘pretty much destroyed,’ company founder says amid speculation over boycott cancellation originally appeared on Benzinga.com
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