Athletes' Performance revolutionizes training

Dan Burns, CEO of the performance training company, shared the company's scientific approach that integrates four pillars — mindset, nutrition, movement, and recovery — to give athletes everything they need to perform their best at the Economic Club of Phoenix Luncheon.

When Mark Verstegen founded Athletes’ Performance in 1999, the private industry of performance training “was largely nonexistent,” said current CEO Dan Burns at the Economic Club of Phoenix Luncheon. Mark’s vision: a scientific approach that integrates four pillars — mindset, nutrition, movement and recovery — to give athletes everything they need to perform at their best. A great vision, but, like many companies, Athletes’ Performance was starting from nothing. “We had no money. We had no model,” Burns explained.

Since the company’s founding, it has been that model revolutionary in the performance training industry — that has driven the company’s success. Athletes’ Performance helps its clients advance human performance with a scientific, outcome-based approach based on those four pillars. Burns explained, “Mindset is about visualizing success. Nutrition is about using food as fuel, to help the body perform its best. Movement is personalized based on what the individual needs to get positive outcomes and stay engaged. Recovery is about sleep and the purposeful upgrading of the body when not at work.”

Today, with that approach, Athletes’ Performance serves clients in three categories: elite sports players who want to make the most of their potentially very lucrative careers; military special operatives, a vital national security resource, who perform in the harshest of conditions; and corporations, for which employee healthcare is a huge cost, incentivized to help employees get and stay healthy.

But fourteen years ago, all Athletes’ Performance had was the vision. The first step in realizing it: Build a facility where experts across disciplines could work together. As it happened, Arizona State University had some land available within its athletic complex. University leaders believed in Verstegen’s vision and agreed to a public-private land agreement (the University's first), allowing Athletes’ Performance to build its first permanent facility.

“ASU really helped incubate us,” Burns explained. “They helped innovate not just Athletes’ Performance, but the entire industry.”

In addition to the space, Athletes’ Performance needed operating capital. They approached Adidas with a creative idea: pre-fund a five-year sponsorship. The company then used that sponsorship to secure a loan from the U.S. Small Business Administration. Still, the company was primarily funded by Verstegen himself so, said Burns, “we had to be profitable every year.”

As important as leveraging its rich partnering opportunities in those early days was the imperative to stay lean. “Business growth was great,” Burns explained, “but only if we were growing because we were authentically delivering measurable, successful outcomes.”

An infusion of capital to build out technology infrastructure

Just five years after opening that first facility on the campus of ASU, Athletes’ Performance had a second facility in Los Angeles, for training the U.S. national soccer team. And the company had extended its services internationally as well. “That was the time we realized we had to ask, ‘Who are we as a company? What business are we really in?’” Burns explained.

“We could have said simply that we were trainers of elite athletes,” Burns recalled. “But optimizing human performance is critical for anyone who competes in rigorous environments,” he said. “We realized that we should be leaders in helping any kind of person maximize their performance.”

Achieving that broader vision for what the company could become required something more than Athletes’ Performance was already doing. “At the time we had a team of great coaches. But it’s hard to effectively scale with great coaches alone,” Burns explained. “We realized we had to become a technology company — to assimilate performance data and then build personalized game plans to produce outcomes for the individuals we work worth.”

That was the vision when Athletes’ Performance first went into the market for venture capital, in late 2006. An infusion of capital from Polaris Partners helped the company build out its technology infrastructure, which Burns said is critical to where the company is at today. “We chose Polaris because they shared our vision and understood where we wanted to go as a company.”

Another infusion of capital to expand to meet demand

Fast-forward another six years: It is 2012, and Athletes’ Performance has grown significantly since its days working exclusively with elite athletes. At this point the company has contracts with corporations to provide performance training to employees and has just secured a deal to provide human performance training at every special operations base in the country.

“At the beginning of 2012, we were a company of 150 employees,” Burns recounts. “We had to hire 250 employees to service the military engagements and scale the corporate part of our business. We also had some gaps. We’re one of the best kept secrets because we never invested in marketing. As an entrepreneurial company we had to make choices and for the markets we initially sold into marketing wasn’t vital. But now as we expand out to corporations and the population we want to share our story because we think we can help more people.”

Filling those gaps required some significant investments, Burns said. So Athletes’ Performance began looking for a capital partner. A true partnership, with a firm that shared the company’s vision, was essential. “We needed to raise capital to grow, but not to keep the doors open,” Burns explained. “We’ve always been self-sustaining. So that allowed us to find the right fit capital partner, someone who would truly partner with us, and with whom we’d have the right dynamic.”

After taking a few meetings, Athletes’ Performance met and got to know John Stobo, managing partner at ABS Capital Partners. “They’re a group that truly supports us. They have an understanding of and passion for what we do,” Burns explained. “That’s a true partner.”

ABS Capital Partners is a growth equity investment firm that has risen in aggregate $2.5 billion for more than a hundred companies. The companies ABS invests in are typically rapidly growing with $10-60 million in revenue. Athletes’ Performance caught their eye in part for its innovation in the healthcare space. “In our healthcare investing efforts, we’re looking at companies that are bending the cost curve” — e.g., lowering costs over time, Stobo explained. “For corporations, the implementation of Athletes’ Performance programs can really help cut healthcare costs.”

Together ABS Capital Partners and Athletes’ Performance look forward to great things in 2014, including the rollout of programs with the military and with the Mayo Clinic (for the first time ever, the Mayo Clinic is bringing in an outside firm — Athletes’ Performance — to provide performance training for employees). Burns forecasts 66 percent top-line growth in 2014.