Barre3: Sadie Lincoln

Sadie Lincoln and her husband, Chris, had what seemed like the perfect life – well-paying jobs, a house in the Bay Area, two kids. But one day they decided to sell everything and start a new business called Barre3: a studio exercise program that blends ballet with pilates and yoga. Today, Barre3 has more than 100 studios across the country. PLUS in our postscript "How You Built That," how a husband-and-wife team experimented with fruit, spices and vinegar and came up with a gourmet ketchup line called 'Chups. See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Speaker 00

  One evening, we put the kids to bed. I'll never forget this. We're in the living room and Chris came up to me and he pulled a spreadsheet out of his pocket. And he said, Sadie, I've been holding this in my pocket for a couple of weeks. And he opened it up and it was a spreadsheet, a model of how we could sell our home, all our possessions, and drop out and not work.

• 0:31Guy Raz?

  For...

• 0:32Speaker 00

  A year.

• 0:33Guy Raz?

  For a year. Wow.

• 0:35Speaker 00

  And that was the spark to building what we built.

• 0:48Guy Raz?

  From NPR, it's How I Built This, a show about innovators, entrepreneurs, idealists, and the stories behind the movements they built. I'm Guy Raz and on the show today, how Sadie Lincoln turned a room with mirrors and a ballet bar into a multimillion dollar company that's now one of the fastest growing fitness programs in the US. So if you were to take a little bit of Pilates and some yoga and then throw in some ballet into the mix, you'd get BAR. It's actually been around since 1959, when a former ballerina named Lottie Burke invented the whole concept in London.

• 1:32Guy Raz?

  But it didn't really begin to take off in the US until this past decade. And today, there are more than 700 bar studios around the country, companies like Core Fusion, Physique 57, and Pure Bar. Now, the people who go to bar classes are overwhelmingly women. And most of them aren't just going for the exercises, they're actually connected to the culture around the whole bar movement. It's about building confidence and esteem, but it's also big business. The whole boutique fitness sector, which BAR is definitely a part of, is now a $30 billion industry. And one of the best-known faces of BAR, Sadie Lincoln.

• 2:14Guy Raz?

  Her company, Bar Three, now has about 130 locations all around the world. And the company is still privately owned by Sadie and her husband, Chris, and just one outside investor. Now, all of this has, of course, made them rich, and in Sadie's case, it's made her a celebrity fitness guru, which, as you will hear, has made her very uncomfortable. Because Sadie isn't actually as flashy and slick as her online videos would suggest. In fact, her upbringing, it was pretty unconventional.

• 2:45Speaker 00

  My mom and her four best friends dropped out. They're part of the counterculture in the 60s.

• 2:51Guy Raz?

  They were, like, they were living in California and they just dropped out?

• 2:54Speaker 00

  They were living in California, yep. They found each other. They're kind of gypsy-like. They're traveling around together. They ended up in Taos, New Mexico. And each of them ended up having a child. The dads all split, and they basically raised us kids collaboratively.

• 3:12Guy Raz?

  That's, I mean, was that their, their plan? Like, to, all these women to move to Taos and, you know, basically have children and then all to raise these children together? Because it, I mean, that's how it worked out. Is that how they thought it was going to work out?

• 3:28Speaker 00

  I don't think they had a plan. I think it just happened, and it was a time of exploration. It was a time for them to go inward, look inside, live close to nature, trust their intellect, and create and discover a new way of living.

• 3:46Guy Raz?

  And there were five kids altogether?

• 3:49Speaker 00

  Yes, let's see. So Lark is eight years older than me, so she's sort of like an honorary auntie in a way. But Lark, Sophia, Chia, Kyle, Miguel, me.

• 4:00Guy Raz?

  So six.

• 4:01Speaker 00

  Yeah.

• 4:02Guy Raz?

  And was fitness part of your early childhood?

• 4:05Speaker 00

  Well, we, we used to do what we called boogie parties. We would put on a rad record and boogie, dance our butts off. Bob Dylan, Willie Nelson, Chuck Berry, The Beatles, of course. We did that as a family often. So that was my first kind of introduction to just loving moving.

• 4:24Guy Raz?

  Hmm. And how did, how did your mom, like, make ends meet?

• 4:27Speaker 00

  Well, first of all, we were often on food stamps. I do have memories of going to the store with food stamps with a note from my mom that I could use them and thinking, oh, this is, I have different money than other people. But they did end up, once they got secure and they had some stability, they created their own business. They created a newspaper called What's Happening and then changed it in later years to Eugene Weekly, which is still the weekly publication in Eugene.

• 4:54Guy Raz?

  Yeah, and did you sometimes feel like a weird kid, like a different kid?

• 4:59Speaker 00

  Yes, I felt like a weird kid. And then I tried to play normal, you know. I played normal for a long time, just I didn't want my friends to know that I had this alternative, out of the box family. I was really attracted to normal kids, normal families.

• 5:16Guy Raz?

  Were you embarrassed?

• 5:17Speaker 00

  Oh, yeah. Yeah, I was embarrassed. I mean, my mom was wearing Birkenstocks before they were cool. They were smoking weed before it was legal. They were just outrageous in some ways. Now I think it's wonderful, but back then, you know, I wanted to be, I was like Alex P. Keaton in Family Ties.

• 5:35Guy Raz?

  Oh, really?

• 5:36Speaker 00

  Kind of. I was like, you know, I became a cheerleader, you know, which is very, you know, of course, they all supported me because that's what they do, unconditional love, no matter what your choice is. It was really social. I just wanted to be normal.

• 5:51Guy Raz?

  So were you a pretty good student in high school?

• 5:55Speaker 00

  Horrible student.

• 5:56Guy Raz?

  Really?

• 5:58Speaker 00

  Really bad. And I went to alternative school called Magnet Arts. I developed a great deal of confidence there. You know, we did pottery and dance and music and, but I didn't learn the basics. And then middle school, I entered middle school and I didn't have the foundation nor the interest. And so I just kind of survived on having fun.

• 6:22Guy Raz?

  So after high school, Sadie took off for LA. She thought she'd become an actor. And in the meantime, she started to take classes at Santa Monica City College and she discovered that she actually liked it. So a couple of years in, she transferred to UCLA. And it was during that time she got really into fitness classes. So after college, Sadie decided to look for work in the fitness industry.

• 6:46Speaker 00

  Yeah. I landed a job with a company called 24 Hour Fitness. And the reason I took that job really was I wanted to move to San Francisco to live with my girlfriend. I had lived on her dining room floor, literally. And they were based out of the Bay Area and fitness. I was like, perfect.

• 7:05Guy Raz?

  And what was the job that you were hired to do?

• 7:08Speaker 00

  I was hired to run all of the group exercise for, I think, 25 gyms.

• 7:14Guy Raz?

  Wow.

• 7:14Speaker 00

  It was a big job. We were acquiring gyms at a rapid pace. So I started, I think we had around 50 gyms, and I ended up staying there for 11 years. And when I left, we had 430 locations.

• 7:25Guy Raz?

  Wow. So this was just massive explosive growth?

• 7:28Speaker 00

  Explosive growth. I thought I was going to work there maybe one to two years. And I ended up reporting direct to the founder and CEO, Mark Mastrov. And he just kept igniting interest in me because he'd give me all these incredible projects along the way. So everything from sales to brand strategy, which was my favorite. I mean, it was the ultimate learning experience for me. I traveled all over the world, all through Scandinavia, and Asia, and Spain, and Italy. Mark had other businesses besides 24 Hour Fitness that I got to be a part of, gyms in Russia.

• 8:04Guy Raz?

  Wow. So he's like a major, like, fitness mogul?

• 8:09Speaker 00

  There's no one greater. I mean, in the fitness industry, he's known.

• 8:12Guy Raz?

  Even to this day?

• 8:13Speaker 00

  Yeah. Oh, yeah.

• 8:14Guy Raz?

  Hmm. Okay, so you are at 24 Hour Fitness. It's exploding in growth. And is that, by the way, is that where you met your husband, Chris?

• 8:23Speaker 00

  I met Chris in San Francisco outside of 24 Hour Fitness. He was working for a startup software company. I met him at a Super Bowl party.

• 8:31Guy Raz?

  Oh, right.

• 8:32Speaker 00

  And we connected instantly. His last name's Lincoln, and I remember he introduced himself as Lincoln. Everybody called him Lincoln. And I remember in that moment thinking, oh, [BLEEP], my name's going to be Mercedes Lincoln. My real name's Mercedes. I knew that instant.

• 8:46Guy Raz?

  Wow.

• 8:47Speaker 00

  Yeah, I knew. I knew.

• 8:48Guy Raz?

  Oh, my god.

• 8:49Speaker 00

  Yeah, he was the one. And he, after a couple lunches with Mark Mastrov, Mark pulled Chris into the loop as well. So he ended up working direct for Mark as well. And so Mark now had me and Chris, and he would put us on projects together. So it was a wonderful testing ground for us as business partners to see how we work together. Chris is really analytical, really grounded. I'm more of the new shiny thing dreamer.

• 9:17Speaker 00

  We bought a house, which is like climbing Mount Everest in the Bay Area, which is really exciting, defining moment for us, for me especially. I rented almost my entire life growing up. So actually owning a home was incredible. We had two children, back to back, 18 months apart.

• 9:35Guy Raz?

  So, I mean, you're living in the Bay Area, and you've got this gig with Mark, and both you and Chris are kind of doing projects for him. And what happens? Is there some sort of crisis that kind of propels you to make a big life change?

• 9:50Speaker 00

  Well, the first crisis for me, I think, happened before I was pregnant with my first child. Even though I was part of this booming business and my career was booming, and I was making a great salary, and we were buying a house and all that good stuff, my own health was declining, and I didn't feel good. I've just been immersed in the fitness industry, but it wasn't working in my own body.

• 10:15Guy Raz?

  What do you mean?

• 10:17Speaker 00

  I was really uncomfortable in my own skin. I didn't feel alive inside, if that makes sense. I was working out really hard.

• 10:27Guy Raz?

  Every day?

• 10:27Speaker 00

  Every day, running on the treadmill, counting how many calories I was eating and how many calories I was expending, because that's scientific, calories in, calories out. Doing all the right things that I had learned was the formula for success. And this is multi-billion dollar industry I was in was working. I mean, it was selling like hotcakes. And this attachment to an ideal, I was sort of drinking that Kool-Aid. And I was shameful that I wasn't looking that ideal or feeling that ideal.

• 11:00Guy Raz?

  So what changed?

• 11:03Speaker 00

  When I got pregnant with Audrey. I think being pregnant is the ultimate opportunity to realize.

• 11:11Speaker 00

  Intuition. Because if you think about it, inside your body, I was creating a baby without thinking about it. And I never felt more alive and connected and happy. For me, becoming pregnant reminded me of my roots. My aunties, the power of intuition. What healthy really was, was living close to nature, being intuitive versus following someone else's formula. And I had this aha. I started to do yoga at home. And I had this moment of clarity, I'll never forget it, where I literally said to myself, maybe I'm not failing fitness. Maybe fitness is failing me. And I'm probably not alone.

• 11:51Speaker 00

  Even though the fitness industry is booming, the vast majority of us, it's not working. I mean, that's the news story on the news every day. It's like obesity is on the rise. People are more stressed out than they ever have been. There's all these magic pills, magic answers, formulas that we're all so desperately seeking.

• 12:08Guy Raz?

  And were you having this conversation with your husband, with Chris, at the same time?

• 12:12Speaker 00

  I would say the conversation Chris and I were having more at that point versus fitness is failing or not, was we were lonely. Really lonely as a couple. We were having a hard time finding belonging. We didn't have a strong community. And we were kind of like, is this it? Like, is it just you and me? You know? What's going on? He was having a hard time relating to business as he was managing the studios he was managing with 24 Hour Fitness. And, you know, I just, I remember this one moment walking into the room and he was on speakerphone and the manager that was working with, coaching him, they were on a conference call. The guy, and he was, did it with such great intention, but he was, you know, nobody could see each other.

• 12:55Speaker 00

  So he was saying, okay, everybody, raise your right hand. Now put it on your back. Now lift it up. Now put it back down. Now lift it up. Put it back down. So he was having everyone on the conference call pat their own back. And Chris, instead of doing that, was flipping off the speaker.

• 13:12Guy Raz?

  Right?

• 13:13Speaker 00

  I was like, something needs to change. This is not working for us.

• 13:17Guy Raz?

  So.

• 13:17Speaker 00

  We felt empty. There wasn't a sense of purpose.

• 13:21Guy Raz?

  So what did you do?

• 13:22Speaker 00

  So we started, I mean, over the years, over like maybe a two year, he was coming up with all kinds of different business plans from plant watering business to pizza to nail studio chain.

• 13:33Guy Raz?

  Chris was.

• 13:33Speaker 00

  Yeah. And so that was sort of in the backdrop. But also, it was like, I had this good gig. I was working from home. I had two babies. He had a good job. I mean, we had bought our house. So I felt like things were kind of moving along pretty, pretty well. And one evening, we put the kids to bed. I'll never forget this. We're in the living room and Chris came up to me and he pulled a spreadsheet out of his pocket. And he said, Sadie, I've been holding this in my pocket for a couple of weeks and I just need to share it with you. And he opened it up and it was a spreadsheet, a model of how we could sell our home, all

• 14:18Speaker 00

  our possessions and move to Bend, Oregon and drop out and not work.

• 14:24Guy Raz?

  For?

• 14:25Speaker 00

  A year.

• 14:25Guy Raz?

  For a year. Wow.

• 14:27Speaker 00

  And, you know, I'm the one that's usually thinking of these outrageous ideas. He's more conservative and super analytical. For him to bring me this outrageous idea was honestly, one of the hottest things he's ever done. Because I was just like, you see me. You, you see adventure. And it's also a reflection of how I was raised.

• 14:47Guy Raz?

  Yeah.

• 14:48Speaker 00

  It gave us permission to think outside of any kind of boundary. If we cannot work for a year, what can we really do?

• 14:57Guy Raz?

  Yeah.

• 14:59Speaker 00

  So that idea morphed into, let's sell the house and let's put every single penny. Into a dream job that might fail, but we don't care. Let's just try to build a life for ourselves that will feel like dropping out, that will feel free. And that was the spark to building what we built with Bar Three.

• 15:25Guy Raz?

  Wow. So with the money, you moved to Bend, Oregon?

• 15:30Speaker 00

  We ended up deciding on Portland because I wasn't as excited about Bend. You know, I wanted to be in a more thriving urban market.

• 15:40Guy Raz?

  How much cash did you guys have to live off?

• 15:43Speaker 00

  I don't remember the exact number, but I can tell you this. We went down to one car. We packed all of our belongings into the car, a moving van. We moved our two kids, our cat, to Portland, Oregon. We rented a small, little house. We just went down to the bare minimum.

• 15:58Guy Raz?

  And how much did you have to put towards this business idea?

• 16:03Speaker 00

  So our only investor to this day is Mark Mastrow.

• 16:05Guy Raz?

  So he said, hey, I'll work with you guys.

• 16:08Speaker 00

  Yeah. So he gave us a small investment. I want to say like under $200,000. And then our house, which, so we probably had maybe $300,000 or $400,000. And that was with a cushion.

• 16:20Guy Raz?

  Your life savings.

• 16:21Speaker 00

  A little cushion, life savings.

• 16:22Guy Raz?

  And you poured much of that into this business idea?

• 16:26Speaker 00

  Yeah.

• 16:26Guy Raz?

  So what was the concept that you guys started to work on when you got to Oregon?

• 16:32Speaker 00

  Well, I became enamored with studio culture and going to yoga studios, going to bar studios. In the late 90s, early 2000s, bar was really igniting in New York and in San Francisco.

• 16:46Guy Raz?

  And just for people who have no idea what bar is, can you just explain it a little bit more?

• 16:50Speaker 00

  Yeah. Well, bar back then was based off of the Lottie Burke method. Which she was a dancer who rehabbed herself basically at a ballet bar. And her first instructors started the first bar studios. Core Fusion, Physique 57, Bar Method, there's a bunch of them out there. And they sort of had a renaissance in the early 2000s. And I started to take those classes and I was intrigued by them.

• 17:15Guy Raz?

  How come?

• 17:16Speaker 00

  For one thing, they reminded me of sort of a contemporary jazzercise, to be honest. And then using the ballet bar as a prop just has this instant grace and art and heritage that was really attractive to me.

• 17:31Guy Raz?

  And when you got into, when you decided to open a bar studio, there were competitors out there, right? So did you think, how were you able to say, well, we're going to be different this way or attract customers by doing this?

• 17:45Speaker 00

  Mm-hmm. Yeah, so we moved to Portland, a conscious decision where there was no bar around us. And I loved using the ballet bar. I loved the isometric work of Lottie Burke and the small movements and the music. But I wanted to create a studio that instead of being something, being the answer, being a methodology, I didn't want to be the Sadie Lincoln method or the Bar Three method. I just wanted it to be an exercise experience. From the very beginning, in our instructor manual, the very first sentence is, "The one thing that never changes at Bar Three is we're always changing." At the very beginning of class, almost every instructor will start by saying, "Welcome to Bar Three.

• 18:27Speaker 00

  I give you full permission to do something different than I say. Your only job is to listen, not to me, but yourself. I'm your guide. We're going to turn the music on. I'm going to show you how to align your body and then I want you to make it your own."

• 18:42Guy Raz?

  But just as an idea to introduce people, I mean, obviously, you introduce it to people when they show up and when they start taking the classes, right? But Like, when you passed by the studio and you saw this thing, Bar Three, B-A-R-R-E Three, like, a lot of people, maybe I'm speaking for men, I guess. I don't know, I'm probably betraying my stupidity, would say, what is this Barre? Like, what is this thing? Right? And so I can't be the only person who thought that when I first saw it.

• 19:13Speaker 00

  Nobody knew how to pronounce it. Nobody knew what it was. I had a tagline at the beginning, where ballet bar meets yoga and platties.

• 19:21Guy Raz?

  Which you-- OK, that makes sense.

• 19:22Speaker 00

  Right. It was a descriptor to explain what it was.

• 19:26Guy Raz?

  How did you come up with a routine? Did you spend, like, weeks and months kind of writing it down? Or?

• 19:34Speaker 00

  Yeah. Well, I had taught for about 20 years, all different concepts. And so I started to piece together the concepts that balanced the body. So I really focused on working opposing muscle groups in every exercise. So if I worked the bicep, I was going to equally work the tricep. So I had this whole system.

• 19:53Guy Raz?

  When you opened your doors, and this is August 2008,

• 19:57Guy Raz?

  was it right away, was it like a hit? Did people, were people lining up to come in? Was it a curiosity?

• 20:02Speaker 00

  Yeah. Before I even opened our studio, I taught free classes upstairs of what is now Whole Foods, but at the time, it was Wild Oats. And I'll never forget, the day we finally got our permit to open the doors, I sent out an email to the community that was coming to my free classes. And I said, hey, I got my certificate of occupancy. I'm going to teach a class tonight. And I thought maybe a couple of people would show up. You know, my friends, my good friends that I had made. 12 people showed up and paid that night. And I sent out the email at 2:00, and I think I taught at 5:45. And I will never forget that moment. The sun was coming in. I played my opening song with Seal, "Amazing."

• 20:45Speaker 00

  And to this day, when I hear that song, it's such a visceral memory of, this is going to work.

• 20:54Guy Raz?

  Sadie Lincoln. In just a moment, how she took Bar Three from a studio above Wild Oats to locations across the country. And in the process, almost became someone she didn't want to be. I'm Guy Raz. Stay with us. You're listening to How I Built This from NPR.

• 21:25Guy Raz?

  Hey, everyone. Just a quick thanks to two of our sponsors who help make this podcast possible. First, to TD Ameritrade. For over 40 years, TD Ameritrade has followed a straightforward approach to working with clients by listening. Everything TD Ameritrade offers its clients, trading tools, retirement resources, you name it, is built around you. Only after getting to know you do they help you develop a strategy that's aligned with your goals. For a complimentary goal planning session to discuss your financial future, visit tdameritrade.com/podcast. Thanks also to Blue Apron. Blue Apron partners with sustainable farms, fisheries, and ranchers to bring you all

• 22:09Guy Raz?

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• 22:40Guy Raz?

  Hey, welcome back to How I Built This from NPR. I'm Guy Raz. So it's 2008, and at this point, Sadie and Chris are pretty busy running their studio in Portland. And they spend so much time there that they actually have to hire a babysitter to be at the studio so that their kids, and then their clients' kids, can also come to the studio.

• 23:02Speaker 00

  I was a busy mom with two kids, and I think the most important thing to both Chris and I is we wanted to have a community. We wanted a place where we could attract people that were inspirational, thoughtful, connected, exciting to be around.

• 23:18Guy Raz?

  And it was just the two of you at the beginning, right?

• 23:20Speaker 00

  It was just the two of us at the beginning. And then one of my girlfriends, who had moved from the Bay Area, she taught one or two classes in the evening. But I checked everybody in. Open the doors, checked everybody in, cleaned the bathrooms. I mean, the whole thing, taught all 19 classes, 6:00 a.m. to 8:00 p.m. I was there. I knew every single client. Mary Ellen, I remember she was the first person to sign a membership. She's still one of my clients.

• 23:43Guy Raz?

  And if you were a drop-in at that time, how much did you have to pay to take a class?

• 23:46Speaker 00

  $20.

• 23:47Guy Raz?

  So it wasn't cheap.

• 23:48Speaker 00

  It wasn't. It was probably, it was around $5 more than yoga.

• 23:53Guy Raz?

  How much runway did you have before this had to actually start making a profit?

• 23:59Speaker 00

  I think our return was maybe in 16 months or so. It was a pretty quick return. You know, starting with 19 classes a week and having those classes have at least 10 to 12 people was our goal, and that's exactly what we did.

• 24:15Guy Raz?

  I mean, you must have been stressed out.

• 24:17Speaker 00

  Oh, yeah.

• 24:18Guy Raz?

  Even though you were doing 19 classes a week and you probably got a lot of your stress out that way, you still must have been stressed out.

• 24:25Speaker 00

  Teaching 19 classes a week is not healthy. It is not balanced.

• 24:29Guy Raz?

  All right. Yeah, right.

• 24:31Speaker 00

  It is not. The short of the story is my body broke. Literally, my back went out. And I remember my mom saying to me, "Honey, you're embodying your business." Because I was like walking around like a 90-year-old woman, you know, with my back slumped over, like whining and hurting.

• 24:49Guy Raz?

  Yeah.

• 24:50Speaker 00

  And it was like, "Oh, yeah. Shoot, you know, this isn't good." So that was a moment. I was training instructors at the time, so I did have some relief. But I learned that to be healthy, it really is OK to pause, to not move, to not achieve, and to not have an outward expression of what exercise means.

• 25:14Guy Raz?

  But I mean, you must have, like, you know, pulled out of this because you, I mean, you still managed to open up a second location pretty fast, right?

• 25:22Speaker 00

  Pretty much right away. I mean, the first year we were open, we put up a tab on our website that said, "Grow with us," and we got instant interest.

• 25:32Guy Raz?

  What did that mean? You'd like, like, start your own bar three?

• 25:35Speaker 00

  Yeah, we knew, we had, you know, we grew up in an industry where we knew how to run multi-unit operations. So going into bar three, we thought, you know, let's open maybe 20 of these in the Pacific Northwest.

• 25:46Guy Raz?

  So from the get-go, you thought our model should be franchising?

• 25:50Speaker 00

  Yeah. We have this unique knowledge and wisdom in the industry, so... Instead of raising money to open our own, let's look into this franchise model, which is really ultimately about empowering someone else to invest in this idea that we have in our wisdom and open up their own business.

• 26:06Guy Raz?

  And so instead of going to venture capitalists and banks or whatever,

• 26:11Speaker 00

  Yeah.

• 26:12Guy Raz?

  you didn't have to.

• 26:13Speaker 00

  We didn't want to. We didn't want to be beholden to institutional money.

• 26:18Guy Raz?

  Yeah.

• 26:18Speaker 00

  Instead, I was really excited about, I still am excited about the idea of being beholden into other people just like me, who had a dream and wanted to open their own business and have their own skin in the game and be able to make it their own.

• 26:32Guy Raz?

  So where was the second location?

• 26:34Speaker 00

  Our first two partners to sign were the Philippines and Manila and Bend, Oregon.

• 26:42Guy Raz?

  Wow, so you franchised immediately to Manila?

• 26:47Speaker 00

  Yeah, yeah. This woman came in, her name's Tanya Tan, and she was in the States and discovered us. And her family's very entrepreneurial. They have a family business. And then their children each have different business models. And she's the youngest of all the children, and she chose Bar Three.

• 27:03Guy Raz?

  Wow. And because you and Chris had this experience at 24 Hour Fitness franchising, you kind of understood how to structure it.

• 27:10Speaker 00

  I did. I was, we were bullish that way. And I mean, it was exciting. It was an adventure, but we knew we could do it. We knew we could do it internationally with the right partner. And then Darcy in Bend was close enough, and she was coming to class and really a part of our tribe. Shortly after that was Carrie, who opened in Vancouver, Washington, which is just 20 minutes away. So most of our franchise partners were or are clients. So they came to Bar Three, loved Bar Three, knew Bar Three, were owner operated. So unlike some franchises, our franchise is owner operated. So if you're going to franchise with us, you're really going to live and breathe the product. You're going to teach and manage and be the face of it.

• 27:50Guy Raz?

  It's interesting because we had Jerry Morrell on the show, the founder of Five Guys, and which is like one of the fastest growing, very different business from yours, burgers and fries.

• 28:01Speaker 00

  Although I bet more similar than different in some ways, but you never know.

• 28:06Guy Raz?

  And he was opposed to it. Like, all of his sons, part of the Five Guys, they were like, Dad, let's do this. And he really didn't want to do it because to him, like, the burger that they were serving and the fries that they were serving was, he could control the quality. He was completely opposed to the idea. Obviously, he feels differently today. So weren't you nervous about handing over your concept to somebody who could, like, screw it up?

• 28:33Speaker 00

  No. I think that's one thing about, I have unbridled optimism in people, sometimes to a fault, to be honest, but I really do believe in people. And here's the thing, our product isn't a burger. It's a person. It's someone teaching a class. And I cannot pretend to be able to control that because I can't control other people, nor do I want to.

• 28:58Guy Raz?

  But how did you, I mean, there's no way, I mean, as a creative person and a creator of this concept that you spent, you know, years on honing, there's no way that you just handed it over and said, go run with it. Like, you had to get there mentally, I have to assume.

• 29:14Speaker 00

  Well, it's person by person. You know, we would meet with these people and see if there was a deep connection. I believed in our training program. I believed in my ability. My master's is in education. I love training and developing people. And that's what I wanted to bring to fitness, is this idea of teaching. And a true teacher, the teachers that I loved the most, going back to Santa Monica City College, and the teachers who really brought something out of me, it wasn't that they were all-knowing and that they had the answers. They sparked something inside of me that made me realize I have the answers. And I love doing that with body. I love doing that with movement.

• 29:54Speaker 00

  I love showing people that you can, first of all, run your own studio and you can do it your own way. Here's our blueprint, but you now get to go and put your own fingerprint on it.

• 30:06Guy Raz?

  Yeah.

• 30:07Speaker 00

  Because I do not want you to copy. This is not the Sadie Lincoln method. I am not a guru. We're the anti-guru company. And your true power, all of my owners, is in collective wisdom, just like I was raised. We didn't even use the word chain. We still don't. We're a family of owners.

• 30:26Guy Raz?

  I mean, were all of the partners just like, everything was just a perfect fit? It all, it all worked out great? Because it's sort of, it sounds like you didn't really run into any problems.

• 30:36Speaker 00

  Well, we did. I mean, I think the biggest problem was it's emotional. It's scary and it's emotional. And those first partners took a big risk in us and we took a big, you know, jump and leap of faith, trust fall with them as well. Every owner to this day is a trust fall.

• 30:52Guy Raz?

  Yeah.

• 30:53Speaker 00

  And when you franchise, you can't fire someone when you franchise.

• 30:57Guy Raz?

  Right.

• 30:57Speaker 00

  You're in a partnership and it's for the long term. And me and Chris, our job is to always keep that value up so they see that importance of being connected to something bigger. And, you know, that's really what drives me. I'm beholden to all of these partners.

• 31:17Guy Raz?

  You're the CEO of the company?

• 31:18Speaker 00

  I am.

• 31:19Guy Raz?

  How many locations do you guys own?

• 31:23Speaker 00

  We own six locations and then we have 124 franchised.

• 31:29Guy Raz?

  As you guys were just expanding and exploding in growth, I mean, at what point did you just, did you and Chris just say, this is crazy? I mean, it must have been like a hamster wheel that just never stopped going.

• 31:43Speaker 00

  Yeah, I mean, right in the middle there, I kind of lost myself in it. We were booming, we were being acknowledged as like, we were getting great press. You know, we really hit mainstream. And it went from this really insular, like, word of mouth, tribal kind of secret to boom national stage and world stage, really. And I was at the center of that, so that was kind of crazy. I got lost in that a little bit, just being a public figure.

• 32:13Guy Raz?

  You became kind of a fitness celebrity.

• 32:16Speaker 00

  In a way, yeah. And I started to fall into this marketing machine, which I had left. When we moved to Portland, we decidedly shut out all traditional marketing and a way to like, express ourselves. We didn't even like using the word fitness. And then all of a sudden, I kind of got back into that machine. And I was in publications, I was working with this producer in LA, and everybody was telling me this way of speaking about fitness. This is the way you speak about what you're doing.

• 32:49Guy Raz?

  You had people come to you saying, Sadie, we can turn you into the next Jane Fonda.

• 32:54Speaker 00

  That's right.

• 32:55Guy Raz?

  And if you go to the website, I mean, you still are the face of it. And there are videos of you and, but you didn't want to embrace that?

• 33:02Speaker 00

  Well, I did want it because the idea of growing and serving the company that way was really exciting to me. And to be able to get that kind of attention and to fuel our business was super exciting. I mean, it really helped. Soulfully, though, it went against my intuition about not being a guru. And I don't want to feed the messages that are already so loud. We've got the message, it's loud and clear everywhere. Yes, if you work out and you do these things, you're going to look like this. And I was getting trained by producers and stuff to say things. So while you're working out, you're always supposed to say, you're working out this muscle so you can have a thinner waist for bikini season. You're doing this so that you can have this, you know?

• 33:45Speaker 00

  It sells like hotcakes, this is the way you're supposed to do it. And I tried it on for size. They also said, get hair and makeup, you know, get a stylist. So I did all that. So we have online workouts. And there's this little era of online workouts where you can see where I did this change. We've pulled some of them, but. I hired a makeup person. I started to be more self-conscious about what I wore on camera. And then I started to speak in a different language that was more like, quote unquote, "results oriented." And under the videos, the people who were commenting, they were checking me. My clients, the people who are part of my movement, were checking me at the door.

• 34:22Guy Raz?

  They were saying?

• 34:23Speaker 00

  They were saying, "Honey, you don't need to wear all that bronzer. You're beautiful as you are." And you know what? You don't need to tell me to get teeny tiny arms. Like, I'm doing this because I want to be strong.

• 34:35Guy Raz?

  I'm sure there are people who were saying to you, "Look, do you want to be a X-million-dollar company? Or do you want to be an XXXX-million-dollar company?" And you can do that. I mean, you can become like Jillian Michaels or like another Jane Fonda kind of person.

• 34:52Speaker 00

  And by the way, I respect all those people. Mad respect for all these incredible... Most people in my space who are booming right now are incredible women. And I think we all want the same thing. In terms of growing bigger, I'm actually not focused on growing bigger anymore with a company. We've paused franchising for now. We're just holding. We're being still, and we're being uncomfortable and still. Being still is uncomfortable. It's very analogous in class. When we're still in class, or when you try to meditate, I don't know if you ever have, it's uncomfortable to be still.

• 35:23Guy Raz?

  I do every day, and I'm still crazy.

• 35:25Speaker 00

  It's hard. It's hard to be still because it's a real, like, inner mirror thing. You have to check in and see things. So if you look at a company as a person, we've decidedly decided to meditate for a moment, just, "Be still."

• 35:39Guy Raz?

  What was the reason? I mean, did something happen? Or did you and Chris just sit down and say, "Let's just put this on pause"? Why? I mean, in any other business, people would say, "We're growing. Let's grow, let's grow and grow, grow."

• 35:51Speaker 00

  Yeah, which is exciting. Well, we started to be courted by a lot of institutional bankers. Pure Bar was sold for $121 million. They're a bar chain.

• 36:02Guy Raz?

  Yes, and bigger. They have more locations.

• 36:03Speaker 00

  Bigger, amazing, incredible. A powerhouse, right? And like, the story we kept hearing is, "Who's going to be number two? Who's going to be number two? And you could be valued at gazillion dollars." And so we started to entertain a bunch of conversations.

• 36:16Guy Raz?

  You could have just cashed out, like, majorly.

• 36:19Speaker 00

  I... yeah. There's lots of choice out there, right? And I kind of feel like...

• 36:27Speaker 00

  I want to be a bit of a rebel. So I am seeking right now, other CEOs, other founders, other people in this world who are going at it alone. So I just want to protect what I have versus make it giant. And I want to show kind of the business community that you can do it that way.

• 36:48Guy Raz?

  Yeah.

• 36:49Speaker 00

  There's not that many people saying that in the business community. You know, the value of not growing, the value of not selling.

• 36:57Guy Raz?

  You know, it's interesting because there's this kind of drive in certain segments of the business world to do that. But there are plenty of companies, including, you know, episodes on the show we did with Angie's List, companies that are not profitable, but they're sustainable. They are more or less breaking even every year. But that has enabled them to hire, you know, more than 1,000 people. And there are lots of companies that aren't as focused on profit, but are focused on sustainability and just creating jobs and creating careers for people. I mean, so it doesn't have to be about growth and expansion and growth and expansion, right?

• 37:36Speaker 00

  That's right. That's really what I love about my product is that we literally embody ideas in bar three. So we're teaching exercise, but we're embodying ideas. So stay with me for a second. I know this is strange to hear. But I think what you just said is so analogous to fitness. You can do a 30-day extreme program with your body. You know, exercise every single day, eat nothing white, you know, drink tons of water, get 10 hours of sleep every single day, you know, lift lots of weights and get tremendous results. That's like exciting, right? It's tremendous like change in your body. Is that sustainable to exercise every single day and to be that regimented and disciplined? Not for most people.

• 38:21Guy Raz?

  Mm-mm.

• 38:22Speaker 00

  It's a short-term outcome. And that is the story we're sold over and over again with fitness. The story, which is less intoxicating to a lot of people, but over time, I think they really get it, is the sustainability model in the body. Exercising 10 minutes a day, being in touch with the food you're eating. You know, that it's OK to drink a glass of wine, that relationships are just as healthy as exercise. And that developing a long-term relationship with exercise that's sustainable is actually going to benefit your posture, you'll live longer, you'll feel better in your skin. Yeah, you won't shed weight in 30 days necessarily, but in the long term, you will.

• 39:06Guy Raz?

  You know, there's something I've been meaning to ask you about, which is, you know, we've had Melissa and Doug Berman on the show, who came up with Melissa and Doug Toys for Kids, and Kate and Andy Spade, of course, of Kate Spade. And they have these incredible partnerships. I mean, they're married and they are, you know, they built these incredible businesses together. But then, you know, I've talked to other entrepreneurs who say, there's no way I could work with my partner, there's just no way. I mean, the person who I have a family with, like, we would just kill each other. You and Chris have built a business together. Has it, is it just your personalities mesh and you naturally find your way? Or is there ever any tension? Or?

• 39:48Speaker 00

  Yeah. I mean, there's no way. I'm sure there's a way, but I can't imagine a way of not working with Chris. Yes, there's tension. So I'll start there. We're different in that he's really analytical and his skills are different. He's very thoughtful. He doesn't talk very much. He thinks about things for a long, long, long time, whereas I just go gut instinct. Yet, we're both starters. We're both entrepreneurial. We both are really into our children and our dogs. I have my best friend by my side, my rock. He's the one that gives me courage to be bold. And to make crazy decisions.

• 40:32Speaker 00

  And so it just works for us.

• 40:34Guy Raz?

  Are you always talking about the business?

• 40:36Speaker 00

  We talk about it a lot. Like, we talk about the business more than we do our kids. We were joking, we were talking about how many business decisions have been made in bed. But then we were laughing about how funny that sounds because, nothing about that sexy. It's like Carol and Mike Brady. Like, that's who we are in bed. We lie in bed with our laptops and we're like, what color should it be? Orange. Okay. What should our name be? Bar Three. Sounds great. But it's kind of beautiful, too, you know?

• 41:07Guy Raz?

  How much of, I ask pretty much everybody who's been on the show about this question, which is how much of what happened to you guys has to do with luck? And how much of it has to do with your skill and ability?

• 41:20Speaker 00

  Oh, gosh. I think timing was great for us. This boutique movement started and people wanted connection and community. I'm a teacher and group exercise became hot again. Moving to Portland in just the right moment. Being shut out from all the noise, so we weren't competing with anyone. We can just do exactly what we needed to do, scratch our own edge. So that's luck in a way, that this movement, you know, at the right time. But a lot of hard work and inner work and paying our dues out there in the business world certainly was a part of this. So it's, yeah, I think probably like most businesses, a combination of all those factors.

• 42:03Guy Raz?

  Sadie Lincoln, founder of Bar Three. By the way, if her childhood story sounded somewhat familiar, it's probably because you heard her brother Miguel's version on a previous episode of this show. He's Miguel McKelvey, founder of the multi-billion dollar company, WeWork. Miguel also grew up in that all-women's collective. And like his sister Sadie, he also rebelled against it by going into business.

• 42:30Speaker 00

  Was it better than Miguel's?

• 42:33Guy Raz?

  So much better. So much better than Miguel's.

• 42:35Speaker 00

  You can't beat him. I'm just kidding. But I will say I was really excited because my high school chose me over him for the Hall of Fame.

• 42:42Guy Raz?

  Oh, that's good. Sorry, Miguel.

• 42:45Speaker 00

  Us hippie kids, you know?

• 42:54Guy Raz?

  And please do stick around because in just a moment, we're going to hear from you about the things that you're building. But first, a quick thanks to one of our sponsors, American Express Open. Every week on How I Built This, we bring you stories about entrepreneurs who beat the odds, overcame obstacles, and made their ideas happen. It's never easy, and that's why American Express Open wants to help with money and know-how, so you can turn your ideas into impact and get business done. Learn more at open.com.

• 43:26Guy Raz?

  Hey, thanks for sticking around because it's time now for how you built that. And this story begins about five years ago when Matt Wallace was just standing in his kitchen in Washington, DC.

• 43:37Speaker 02

  We had a bag of cherries in the fridge, and we needed to use them before they went bad.

• 43:42Guy Raz?

  Anyway, he and his girlfriend Cory happened to be making turkey burgers at the time, and they were short on ketchup.

• 43:49Speaker 02

  But I like to mess around in the kitchen, so that's where my creative energy kind of comes out.

• 43:54Speaker 03

  And knowing you, you probably wanted to make tomato ketchup, but we didn't have tomatoes. So you said, "I'm going to make cherry ketchup."

• 44:00Guy Raz?

  So Matt looked online, found a recipe, and then cooked the cherries with vinegar and sugar and spices. And boom, he had fresh cherry ketchup that was kind of sweet and kind of smoky.

• 44:11Speaker 02

  It was definitely a novel thing, and we both really liked it.

• 44:15Speaker 03

  Yeah, I loved it.

• 44:16Guy Raz?

  And the story could have ended there, except a few months later, Matt was sitting at his office. He works in the energy business. And he started to think, but he wasn't thinking about energy.

• 44:26Speaker 02

  You know, I kept thinking about the ketchup. I just had this moment of realizing, there's literally one kind of ketchup on the market, and there's this huge gap that no one knows about.

• 44:35Guy Raz?

  Matt couldn't stop thinking about the tyranny of the tomato and a gap in the ketchup market that could be filled not just with cherries, but with all kinds of fruit. So that day, he emailed Cory about starting a business.

• 44:50Speaker 02

  It was probably 30 emails back and forth.

• 44:52Speaker 03

  Yeah.

• 44:53Speaker 02

  And I felt like I had the idea kind of downloaded into my head, fully formed.

• 44:57Speaker 03

  Well, he also knew right away that he wanted to call it Chups. Because his best friend, growing up, referred to ketchup as chup, like pass the chup.

• 45:06Guy Raz?

  So Corey and Matt started to experiment. They took celery and onion, garlic and vinegar, and they'd mix those ingredients with blueberries, mangoes, peaches, plums, and of course, cherries. And what they came up with were five different types of ketchup.

• 45:22Speaker 02

  They work really well with a lot of foods that you wouldn't normally pair your hinds with. Pork tenderloin, fried rice.

• 45:29Guy Raz?

  Matt and Corey started doing taste tests with their friends.

• 45:32Speaker 03

  Create as a base for a vinaigrette.

• 45:34Speaker 02

  Yeah.

• 45:34Speaker 03

  Put them out with our cheese plates.

• 45:35Guy Raz?

  And they even got a thumbs up from celebrity chef Jose Andres, who actually featured the ketchups in one of his restaurants.

• 45:42Speaker 02

  That was really the impetus for me that this guy knows what he's talking about. If we have his sort of unofficial endorsement that this is a good product, you know, we gotta go for it. We gotta make this thing official.

• 45:53Guy Raz?

  So Matt and Corey raised $22,000 on Kickstarter and moved chups out of their kitchen and into a shared commercial space in DC. And they're now selling chups in a few Whole Foods and local markets in the DC area. Oh, and somewhere along the line, they also got married.

• 46:09Speaker 02

  We wanted to do something meaningful. We wanted to do something together.

• 46:13Speaker 03

  Yeah, we're learning the art of the hustle and all of those things. And we get better at it every week.

• 46:19Speaker 02

  Yeah, despite the fact that it's not killing it, flying off the grocery store shelves, we put everything into it. I mean, it's all sweat equity at this point.

• 46:28Guy Raz?

  That's Matt and Corey Wallace. Chups ketchup is expecting to make $50,000 this year. They're not turning a profit just yet. Matt is keeping his day job for now, but Corey is working full time on the business. To find out more about Chups, check out our Facebook page. And of course, if you want to tell us your story, go to build.npr.org. We read each and every one of your pitches. And thanks so much for listening to the show this week. If you want to find out more, you can go to howibuiltthis.npr.org. You can also send us an email. It's h i b t at npr.org. You can tweet at us. That's at howibuiltthis. And of course, please do subscribe to the show on Apple Podcasts or however you get your podcasts.

• 47:11Guy Raz?

  Our show was produced this week by Rund Abdelfatah with original music composed by Ramtin Arablouei. Thanks also to Niva Grant, Sanaz Meshkinpour, Claire Breen, and Jeff Rogers. Our intern is Lawrence Wu. I'm Guy Raz, and you've been listening to How I Built This from NPR.

• 47:42Guy Raz?

  Hey, and one more quick thing. There are a lot of shows out there about the week's news, but there's only one that treats the news the way it deserves to be treated, roughly, rudely, and with lots of tasteless comments. That would be Wait, Wait, Don't Tell Me, the NPR quiz show. Listen to Wait, Wait, Don't Tell Me on the NPR One app or wherever you listen to podcasts.