FitLinxx (Private)

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September 24, 2012 Issue

The Most Powerful Name In Corporate News and Information


With Their Pebble™, a Wireless All-Day Activity Device that Clips to the Belt or Shoe, FitLinxx is Helping Individuals in Fitness and Wellness Programs Monitor Health Indicators such as Calories, Weight and Blood Pressure

Dave Monahan
President and CEO

Dave joined FitLinxx from Microsoft in 2006 as Executive VP of Products and Markets, becoming President and CEO in 2008. With expertise in sales, marketing, engineering and growing businesses through partnerships, Dave has helped transform FitLinxx into an industry-leading provider of activity devices and wireless healthcare products. Prior to joining Microsoft, Dave held senior management positions with SkyTel and Phillips International. Dave has a BS in Mechanical Engineering from Pennsylvania State University and an MBA in International Business from Loyola College.

Company Profile:
FitLinxx develops innovative health and wellness technology that motivates people to live actively and improve their well-being. Sold exclusively through partners to businesses, its wireless activity monitors, health devices and software make it easy for people to accurately track and measure daily activity levels and health indicators like weight and blood pressure. In addition, its fitness facility solution helps members adopt exercise habits that achieve health, wellness and fitness goals.


Using FitLinxx technology, the company’s global partners have created customized fun and engaging programs that help people begin and maintain active and healthy lifestyles. Employers benefit by lowering their healthcare costs, increasing worker productivity and improving overall employee health. FitLinxx is unique in accurately tracking all day activities in an end-to-end wireless solution. The company’s network of fitness facilities and more than 50 partners has helped more than four million people experience the benefits of FitLinxx offerings.


3 Enterprise Drive, Suite 401
Shelton, CT 06484
Phone: 866-316-5151


Interview conducted by: Lynn Fosse, Senior Editor, CEOCFO Magazine, Published – September 24, 2012

Mr. Monahan, what is the basic concept behind FitLinxx?

Mr. Monahan: FitLinxx is a technology company that builds devices and solutions that allow people to engage in fitness and wellness programs. For example, we develop a wireless activity device that will track somebody’s calories and activity time all day. The data from those devices is then sent to our partner’s websites and applications where the users can track their all-day activity, weight, blood pressure and use it within fitness and wellness programs.

CEOCFO: Would you tell us about the market in which you compete and how FitLinxx stands out?

Mr. Monahan: There are three types of industries or markets that we work in. The first is health. If somebody has a health issue such as diabetes, we partner with companies that create diabetes management programs. They will use our devices, our activity monitor, our weight scale, within their program, which will help diabetics manage their exercise and their weight. They can also do other things that the partner provides to the end user to help them manage things like diabetes or obesity and weight management.


The second market we address is “work-site wellness.” Many companies are going to a Consumer Directed Healthcare Plan. As part of that, they are implementing wellness programs that allow employees to manage and improve their health. As part of the program, employees get credit toward funding their consumer directed healthcare plan to offset healthcare costs.


The third market we address is purely fitness. Our partners focus on helping people to improve their fitness levels and use our devices to achieve that goal.


All three areas are partner models. However, each one has a different market and a different set of partners that work within those markets. We differentiate ourselves by focusing on the total user experience of our devices and the applications. Therefore, from a product user experience standpoint, we are focused on making the experience really simple. For example, our activity device is called the “Pebble.” You just clip it on to your belt or shoe and it will just manage and track your all-day activity. You do not need to do anything with the device. It does it all. It will also upload its data wirelessly to your application. You do not need to push any buttons or plug it into anything.  That is a great user experience. It is a huge differentiator of ours. We are also world-class in how we integrate our devices and our data with our partners’ applications. We do not believe technology solves a problem; we believe it is part of the overall solution.  More than 50 partners create solutions with us and have deep expertise in things like managing diabetes, losing weight, improving fitness levels, and work-site wellness. By integrating our devices in a simple way, we create an overall solution for customers that is very compelling. We are also focusing on a low price point, because we want to impress what we call “total population” -- young, old, male, female, diseased or fit. We know it is hard to implement across large populations like an employer environment where the price has to be low so a company can afford it. Lastly, since we are focused in the B-to-B market, we pride ourselves on being what we call “business-ready”- being able to support implementations, use cases, and fix issues as quickly as possible. We have a set of tools and a group of people who support implementations and make sure things run smoothly.

CEOCFO: Are your partners typically starting new programs or are they replacing programs they already place?

Mr. Monahan: From a replacement standpoint, there are a number of programs out there that utilize inexpensive and inaccurate activity devices. These programs have users manually enter data into an application. If you are wearing a pedometer and it shows you made five thousand steps for the day, you then sit down with your computer, enter five thousand steps in the application and it would upload the data to your website. Many of our partners say that they want verifiable and accurate data. Rather than have somebody interpret the data and put it into a website, they would rather have the data come right from the device with no user interaction. Therefore, we are replacing programs where there was a lot of manual entry in the past.


The other side is brand-new programs. We enable completely new use cases. For example, National Jewish Health in Denver wanted to create an obesity management program. They focused on individuals with very high BMIs. Thirty-five and above was their target. They wanted to give those people a good application to use out of their home. We enabled them with a wireless weight scale and our wireless activity device to be used out of their house so that the cost per user was kept down. They got online support both to the application and our devices and they also got an online coach. This is a whole new use case where you can take a real robust and well-proven program and implement it out of the home.

CEOCFO: Both you personally and FitLinxx have won a number of awards and industry recognition. Is that helpful when you are reaching new clients?

Mr. Monahan: It is very helpful when reaching new clients. Although we feel great about what we have done and we have great use cases where we can show off what we have done, many people are looking for third-party validation.  It is important to be proven in the eyes of a third party. It definitely validates what we have done.

CEOCFO: Are there areas in fitness that you would like to address that you have not done yet or that you have in the works?

Mr. Monahan: Yes. We are launching a product of our third-generation activity device called the Pebble in the first week of September. That brings our current product up to where it can do things like track more types of activities. Right now we track walking, general moving, and running, but our current product does not track activities like biking and elliptical, so we keep adding new algorithms to allow a broader set of activities to be tracked.


We are also working on integrating more medical devices into our applications. We currently have a weight scale and blood pressure monitor. We are working with some other device manufacturers who will start adding things that would help a diabetic with glucose meters or somebody with a blood condition to be able to show blood results through our application. We are trying to broaden what we do, both from a fitness perspective and a health perspective. When we see it all intermingling depending upon what your specific condition is, everybody sees the value of activity so we can continue to develop that product and continue to add more and more features to it. However, in parallel to that, people are looking for companion devices and health devices that help them with specific conditions.

CEOCFO: Are you strictly in the US now and do you see that changing?

Mr. Monahan: We sell in Europe as well. We have an office outside of London. We are really focusing on the UK market as of now. However, we also have some opportunities right now in mainland Europe and we are seeing some interest in Asia. This year, for the most part, it has been US based. However, we also have a couple of large customers and partners in the UK and we see that expanding in 2013 not only in the UK but also beyond that in mainland Europe and Asia.

CEOCFO: Is there the same general interest in fitness in various geographical areas or are there major differences?

Mr. Monahan: It varies a bit. There is one thing that is true across the world, which is that everybody is dealing with chronic disease epidemics from diabetes to obesity. That has become common as economies are developing and they are starting to see these disease states creep into their populations. There is one major driving force which is trying to manage chronic disease. How do the major countries of the world differ in how they manage this? One of the main differences is their healthcare system. In the US, it is private right now and in Europe it is government driven, therefore as a company, you have to be aware of that and figure out how you best position and sell into that environment. In Asia, it is all over the map depending upon where you are and within countries, it can be different. Everybody is interested in the types of solutions we are offering but how you go to market can be very different depending on global dynamics.

CEOCFO: Speaking of government healthcare, how do you plan for the possible changes ahead?

Mr. Monahan: The good news for us is it does not matter too much what actual system is implemented. This is because no matter what system is implemented in the US, we still have a base problem which is seventy-five percent of our healthcare costs are driven just by poor habits, poor nutrition, being inactive, and twenty percent of the population smoking. Those are the three things. If you do not tackle those three no matter what system you have in place, you are not going to get control of health care costs. We see that no matter what happens in the US, those key issues are going to have to be addressed. If it heads towards more government driven, I still think there will be plenty of private pieces of that which we can drive. It just might be implemented a little bit differently but the net solution is the same. The “net” for us is the overall driver to the market and the cost of healthcare that make our product valuable, and that is not going to change no matter what system is in place.

CEOCFO: How is business?

Mr. Monahan: Very good! Last year we grew by sixty-eight percent. This year, again, we are seeing tremendous growth and the dynamics are changing for us. Last year, it was very much about individual employers implementing programs. Now we are seeing the insurers come into this market and want to offer programs through their insurance plans. Therefore, it is becoming bigger. With that, there are some transitions for us as far as mapping our solutions. The market has gotten much bigger in the last year. We had a great year last year and we are having a very good year this year. We are in a great growth cycle right now.

CEOCFO: How do you reach potential customers?

Mr. Monahan: We go through our partners from a marketing perspective. We are purely a partner-driven organization. Our products are built to support our partners’ needs. We also provide all the support materials and marketing pieces that they need to co-market. We will co-market with them, therefore we will focus on things like getting our overall product message and company message out through conferences, seminars, tradeshows, publications like yours, social media, etc. We want to get our message out in the broad sense to support what our partners need and also what the general market needs to know about us. However, actually driving demand is what our partners do. For example, Global Fit or Sonic Boom, who provide wellness programs for corporations, will market their brand to the employers. They will typically focus on Fortune-500 so they will go where the Fortune-500s are. Our message will be embedded inside theirs and we support them in that process. Sometimes we will do joint press releases, we will do joint conferences; we will present conferences together, typically side-by-side with the partner.

CEOCFO: Why should investors and people in the business community pay attention to FitLinxx today?

Mr. Monahan: We are at the very tip of the iceberg. We are seeing more and more at a very high level that two major shifts are happening. There is one at a corporate level. Corporations and employers need to control healthcare costs. They have been getting ten, fifteen, twenty percent increases year over year, every year and what we are seeing is they are done with that. They are going to move more towards programs that allow them to control that cost and actually focus on employees’ health as part of that goal. Therefore, we are in a nice ‘sweet spot’ of growth where employers are creating these consumer directed healthcare plans and embedding wellness programs inside of those to allow people to engage with their health and earn incentives by participating. There is a tremendous growth trajectory on just that alone. There is another growth trajectory - we are seeing a lot more pressing consumer interest in just general health, wellness and fitness. There have been a lot of studies showing that there is a big shift happening right now where people want tools that help them improve their health and manage their health. The combination of those two things just presented a tremendous growth opportunity for us in multiple markets.


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Our activity device is called the “Pebble.” You just clip it on to your belt or shoe and it will just manage and track your all-day activity. You do not need to do anything with the device. It does it all. - Dave Monahan does not purchase or make
recommendation on stocks based on the interviews published.