What is in this article?:
- Fitness Leader Augie Nieto Aims for a Future without ALS
- Act Two: ALS
Club Industry will present Augie Nieto with its Lifetime Achievement Award on Oct. 8 at the Club Industry Show in Chicago for his work popularizing and improving the LifeCycle and his more recent work in pulling the fitness industry together behind finding a cure for amyotrophic lateral sclerosis.
Augie Nieto was at the helm of Life Fitness for much of its early years, building upon the success of the company's initial product, the Lifecycle, to create one of the largest fitness equipment manufacturers in the world. The Lifecycle was the first electronic bike and led to an electronic revolution of cardio equipment. Ten years ago, Augie was diagnosed with amyotrophic lateral sclerosis (ALS) and has spent those 10 years raising money for ALS research. (Photo courtesy Life Fitness.)
Act One: Picture a man—young, tall, muscular with full dark hair, his skin kissed by the sun, driving fast cars, visiting exotic places, cruising on his yacht, heading a successful fitness equipment manufacturing company and living in his California beach house with his high school sweetheart. This is Augie Nieto of the past, the co-founder of Life Fitness and a man some aspired to be and some may even have envied.
"During his entire tenure at Life Fitness, everybody had one question: 'What was Augie doing?' Everybody had their eye on Augie," said John McCarthy, former executive director of IHRSA.
Act Two: Picture a man sitting in a motorized wheelchair, his voice taken from him, his ability to breathe on his own and move his body limited by amyotrophic lateral sclerosis (ALS), a progressive neurodegenerative disease that affects nerve cells, causing muscles to waste away. This is Augie Nieto today. Few people in the industry likely envy his life today, but Augie is grateful for it.
"I feel like everything that’s happened to me, both professionally and personally, led me to the place I am in my life now," Augie typed by moving two tracking balls with his toes into a specially designed computer program that allows him to communicate. "Yes, I have ALS and that sucks. But I know unconditional love, I have three beautiful grandkids that call me Pops, I have stronger relationships with my grown children and enjoy them and their spouses so much. I still get to work with the leaders in the fitness industry to make this world a better place. I’m challenged every day and know I still have so much to contribute. So, like everyone, I made mistakes, but they led me to where I am now, so I’m grateful."
As Augie wrote in one of his two books, his life has gone from success to significance. Even though he may downplay the significance of his life at the helm of Life Fitness, the setting of his first act offered a significance that cannot be overlooked for the fitness industry.
Act One: The Fitness Industry
For much of Augie's childhood, he was overweight. That is, until he discovered the benefits of exercise and lost almost 100 pounds prior to his junior year in high school. That year, Augie caught the eye of Lynne Bransford, now his wife, and the two dated during their junior and senior years, going their separate ways for college.
While at Claremont College in the late 1970s, Augie combined his entrepreneurial streak with his love of fitness, becoming part owner of a health club. To attract more women into his heavily male membership, he tried different products, soon discovering the Lifecycle at a Family Fitness Center in San Diego owned by Ray Wilson. The four computerized stationary bikes that Wilson had were a big hit with his female members, and Augie had intentions of translating that success to his club. The bike took users on a 12-minute "ride" on simulated hills, which showed up on the dashboard as red dots. The Lifecycle showed users how fast they were going and how far they had gone—information that was revolutionary at that time.
Wilson owned the North American rights to the Lifecycle, which was created in 1968 by Dr. Keene Dimick. Augie partnered with Wilson to distribute the Lifecycle, and in 1979, the two created Lifecycle Inc. Augie sold his piece of his health club, bought an RV that he named Sluggo and traveled the country with one demonstration bike and his friend and college roommate Scott McFarlane to sell the Lifecycle to the largest health club owners. To finance his venture, Nieto borrowed about $200,000 of the $421,000 investment from family and friends.
But the Lifecycle initially didn't sell as well as Augie had anticipated. The $3,000 price tag (equating to $9,800 in today's dollars) may have had something to do with that. Then, Augie hit on an idea: he would give a Lifecycle to the 50 top club operators for their personal use. Once they saw how exciting the product was to use, he was sure they would buy more. And he was right. Soon, the company began to receive orders.
Some of his first customers included Ron Hemelgarn, who owned health clubs in the Midwest, and Mark Mastrov, who at that time owned Nautilus Health (later to become 24 Hour Fitness).
The Lifecycle was the dawn of a new era, Mastrov said.
"It meant that technology was about to enter our industry," Mastrov said. "I think a good 40 percent of the member base is focused on cardiovascular equipment, and so the bells and whistles that have been created over the years and inundated our industry changed our industry for the better. Without what Augie created—and others that came behind him—the industry wouldn’t be where it is today."
But the product was not without problems. The Lifecycles were heavy, requiring two people to lift them, Mastrov recalled. Users tended to stand on the housing unit instead of stepping across it to the pedals, which caused the housing unit to break. Exercisers' sweat dripped on the consoles, corroding and cracking the materials. The electronics also broke down.
"The bikes couldn’t withstand the volume of thousands of people using them a week," Mastrov said. "They had to go back and improve the product line."
And improve they did. Augie brought a friend, Bryan Andrus, to the company's Irvine, California, plant where the products were assembled to work with Ron Dorwart on improving the product. The pressure to improve the bikes was especially high because Augie guaranteed every bike, repairing or replacing them with no questions asked, Dorwart recalled in Augie's book "Augie's Quest: One Man's Journey from Success to Significance." In return, the club owners often purchased more Lifecycles.
Augie was the reason Hemelgarn continued to buy the Lifecycle despite the initial problems.
"When I communicated with Augie, he didn’t disagree with me," Hemelgarn said. "He wanted to know everything that was going wrong, and he fixed it. I've dealt with a lot of salespeople. Some make excuses. Augie never makes excuses. He just wanted to find a solution. That is why I stayed with him over all these years."
Peter Brown, president of Athletic Business Media, worked with Augie in the early 1980s selling the Lifecycle. Brown credits Dale Dibble, co-founder of Cedardale Health and Fitness and one of the industry gurus at that time, for helping to increase Lifecycle sales. Dibble was a fan of the Lifecycle after he used it while recuperating from heart surgery, impressing his cardiologist with his progress.
In 1982 at the first IHRSA trade show, Dibble brought a group of about 14 health club owners by the Lifecycle booth at the Tropicana Hotel in Las Vegas and told the group that the Lifecycle was the greatest product he ever bought
"Right there, we must have sold 50 bikes," Brown said.
Augie showcased his product to even more club owners at another trade show after Brown and he noticed that club owners would sneak onto the trade show floor at 6 a.m. to use the equipment for their morning workouts before early morning workouts were a tradition at trade shows. So the two ordered muffins and coffee from room service and took the food to the exhibit hall for the club owners. They were the only vendors there.
"We had full run of every club owner who was there," Brown said. "It gave Augie a one-on-one opportunity. You are talking about the greatest salesman in the business."
Still the high ticket price was hampering sales, even though Augie allowed some operators to lease the bikes for $70 per month. So Augie targeted large chains in hopes that large orders would help reduce the price of the Lifecycle to something more affordable, considering the competing bike at the time—the Monarch—was selling for $600.
In 1985, Augie worked a deal with the big player at that time, Don Wildman, owner of Health and Tennis Clubs, that decreased the price to $1,900, Brown said.
Augie's reputation grew as the reputation of the Lifecycle grew.
People knew that a handshake was all they needed to do a deal with Augie, said Pat Regan, who has been in the industry since 1978 and once was a dealer for Life Fitness. Today, Regan is vice president of purchasing for Life Time Fitness, Chanhassen, Minnesota.
"It was really a trust-based relationship with Augie," Regan said. "Those trust-based relationships—you can't buy them; you earn them. And the only way you earned them was time and being authentic over time. And that is who Augie was. He was always authentic."
The company had an advantage over other equipment manufacturers at that time, Brown said, because it was the only maker of commercial fitness equipment that sold directly to commercial health clubs at a time when others sold through dealers or regional distributors.
"So, we had direct feedback on our product from our customers and users," Brown said. "It gave us a distinct advantage because it wasn't filtered through a distributor or dealer. That was the way that Augie insisted on having it. Augie dealt directly with the customers. He wouldn’t have it any other way."
Bally Manufacturing Corp., which made gaming machines, purchased Lifecycle Inc. from Augie and Wilson in 1984 for $10 million and renamed it Bally Fitness Products Inc. Augie came with the company, and with his leadership and Bally’s financial backing and production capacity, the company grew steadily. In 1987, the company was renamed Life Fitness and eventually added strength equipment. In 1991, Augie partnered with Mancuso & Co. to buy the company back from Bally. In 1997, he sold the company to Brunswick Corp.