The founders of the dance fitness craze teach their trainers how to turn a passion into a thriving business.
Zumba Fitness LLC
Creator Alberto "Beto" Perez teaches a Zumba Fitness class.
Last year, Tanya Owens Nuchols was living in Washington D.C, working as a graphic designer when, like so many others, she was laid off. She had three kids to support, and zero job opportunities lined up.
Now, Nuchols says losing her job was "a blessing in disguise."
Just a few years before, in an effort to lose some baby weight, Nuchols had started attending her gym's Zumba Fitness classes, a dance fitness program that began in Colombia. By 2006 she became a certified Zumba trainer.
"At that point I was just teaching Zumba on the side," Nuchols, 34, says, "and for the longest time I'd been telling myself I wish I could dance full time. I wish I didn't have to be chained to a desk, so when I got laid off, at first I was scared about not having a job, but the Zumba job offers just started pouring in."
Now, she's making a comparable salary teaching Zumba to everyone from federal employees to disadvantaged youths. Nuchols' story is not entirely unique, though. Between early 2008 and 2009, the number of Zumba instructors around the world tripled. Now, the classes are taught in 105 countries across 60,000 locations with 7.5 million attendees showing up every week to practice a range of dance styles, from salsa to African, from hip-hop to belly dancing.
Co-founder and CEO Alberto Perlman says the company's ability to grow during the recession has been contingent on the strength of its trainers, which is why helping instructors get off the ground is now Zumba's No. 1 mission.
"We create a platform to allow other people to be successful doing what they love," Perlman says, "whether being successful means that you're losing weight or being successful means that you're making money. "
Perlman was also out of a job when he discovered the dance craze originated by Colombian fitness guru Alberto "Beto" Perez. Perlman had founded an internet business incubator for Latin Americans in 1998, but many of the business owners he was working with were still in the early stages of funding when the dotcom bubble burst. One by one, Perlman's investors pulled out of the project.
"I was basically 24 and out of a job, but I had already run my own company," Perlman, 33, says. He was looking for his next gig when his mother mentioned having taken Perez's class at a gym in Miami. "She said, 'Why don't you meet with Beto and maybe you can start a gym or something?'" Perlman remembers. "I said, 'I don't think I'm going to start a gym, but I'll meet with him.'"
Perez, 40, had founded Zumba by accident after he forgot to bring his music to an aerobics class he was teaching in Colombia. Instead, he grabbed whatever music he had in his car, mostly Latin tunes, and improvised the class through dance. The demand grew so quickly that Perez moved to Miami hoping to spread the gospel of Zumba to the U.S.
During his time in Miami, Perez met with two investors who were willing to throw millions of dollars into the project, but he never felt right about their vision for Zumba; then he met Perlman. After college, Perlman spent time researching infomercials for a consulting agency, and he wanted to cash in on that knowledge by creating a lucrative infomercial business. He thought Zumba could be his first product.
Perez remembers, "I met with Alberto in Starbucks, and he asked me, 'Do you have money?' I said, 'No.' Then I said, 'Do you have money?' He said, 'No.' I said, 'Okay. Let's do this.'"
Perlman agrees, "We thought, let's work for this, not just invest a bunch of money in it."
Together, they teamed up with co-founder and COO Alberto Aghion, Perlman's childhood friend, who had also known Perez during his early years as a dance instructor in Bogota.
Perez continued to teach classes, and with the money they made, the team produced a demo reel, which caught the eye of the Ohio-based company Fitness Quest.
"We licensed the name and the concept to them to create an infomercial and home videos," Perlman says. By 2002, they had sold hundreds of thousands of Zumba videos and were ready to look for their next product when calls started coming in.
"People started calling us to say, 'I'm a fitness instructor, I bought this tape, I love it so much that I want to become certified in this. Do you guys offer certification?'" Perlman says. "We're like, 'Yeah of course we have a certification.' Meanwhile, I'm thinking we'd better come up with some sort of training for instructors, because there's market demand here."
They held their first training session at a hotel in Miami, where 150 people turned out and paid a small fee to get certified. Though they never intended to be a training-intensive business (their main source of revenue was still generated by home videos), Perlman, Perez and Aghion soon realized that these trainers were becoming the ambassadors for their brand.
"We decided at that moment that our business was going to be about helping instructors become successful," Perlman says.
They launched a web platform called the Zumba Instructor Network aimed at helping the growing number of trainers with marketing, choreography and networking. For a fee, instructors pay for these services as well as Zumba merchandise, including clothing they can buy wholesale and sell to students. "We suddenly were helping them and creating entrepreneurs," Perlman says.
Then, in 2008, the Zumba team was bracing itself for the adverse effects of the recession, expecting their revenue to plummet. "Instead, we saw an inflow of new instructors that was tremendous," Perlman says, "and we realized that a lot of people were losing their jobs, who knew how to dance or liked fitness. It provided a source of income for families during this difficult period."
Nuchols, for one, is grateful that Zumba's business model places such importance on supporting its trainers. "Had it not been for Zumba, I don't know what I'd be doing. I might have an entry level job in my field or be doing free internship work, when I was at a senior level before," she says. "I'm a good designer, but dancing is definitely where my passion is, so in addition to saving me financially, I felt like I'm doing now what I'm meant to be doing."