Scott Watterson took the long way to your living room

The summer job was there for the taking. In 1977, Scott Watterson and Gary Stevenson could work for the water department, or they could start something themselves. They were Utah State University business students, with a choice familiar to anyone who has watched a promising summer approach: collect a wage, or find out whether an idea will pay.

They chose the idea. Their company, Weslo, began in imports. The catalog that followed included wood-burning stoves, a respectable distance from the treadmills and digital training now sold by its descendant, iFIT. A stove asks you to stay beside it. A treadmill asks you to move while remaining in roughly the same place. Watterson’s career has involved finding new things to put inside the home.

Nearly half a century later, the business is still based in Logan, Utah. Its names include NordicTrack and ProForm. Its training platform can bring filmed journeys to exercise equipment and adjust the machine to follow the instruction. The route from that first summer to this particular living room was lengthy, commercially inventive and occasionally uncomfortable.

A summer without the water department

Watterson and Stevenson knew each other before college: they had been grade-school classmates. Their partnership had a local history before it had a product catalog. Their early planning took place at a kitchen table, with business ideas sketched on a napkin. It is an economical surface on which to organize a company, though a poor place to leave the coffee.

Weslo’s early business was adaptable. Imported goods gave way to products it could make and sell in larger numbers. In 1979, the company acquired rights to a freestanding wood-burning stove. Trampolines became part of the story, followed by stationary bicycles, rowing machines and treadmills. The familiar fitness company emerged through a succession of objects rather than one immaculate founding revelation.

Watterson graduated from Utah State’s College of Business in 1979, cum laude. The business had started while he was studying. By August 1989, Weslo was breaking ground for an international headquarters in Logan and receiving a supplier award from Sears. The summer enterprise had acquired the unromantic requirements of an established company: buildings, production and retailers expecting deliveries.

That progression matters because Watterson is often encountered at the other end of the story, attached to a valuation or a recognizable exercise brand. The early record is more useful. It shows a founder willing to move between product categories as opportunities changed. His company’s eventual identity took time to become obvious.

A brand name for $9.5 million

ProForm joined the business in 1987. In 1994, the predecessor businesses were sold to Bain Capital and renamed ICON Health & Fitness. Those corporate changes helped produce a company whose identity was spread across several names. Customers could know the product on the box without knowing much about Scott Watterson.

In December 1998, ICON agreed to pay $9.5 million for key patents, trademarks and other intellectual property belonging to bankrupt NordicTrack. It was buying the ability to use a name, as well as the protected work attached to it. For an equipment manufacturer, a familiar brand can do some of the explaining before a salesperson opens their mouth.

At the time, ICON employed 4,800 people and had recorded more than $750 million in equipment sales during its previous fiscal year. These were substantial operations for a business that had begun as a student import venture in Cache Valley. Watterson was managing a collection of products and identities, with a manufacturing business underneath.

The recognition came locally, too. Utah State honored Watterson with a Professional Achievement Award in 1988 and its Distinguished Executive Alumnus Award in 1995. In 1999, MountainWest Capital Network named Stevenson and Watterson its Entrepreneurs of the Year. By then, their decision about a summer job had been receiving outside approval for quite a while.

The treadmill gets a connection

In February 2000, at the Super Show trade event in Atlanta, ICON demonstrated an iFit.com line powered by the internet, CDs and video. The website could control electronic functions on compatible treadmills, bikes, ellipticals and home gyms. Instructions could change speed, resistance or incline. The screen was beginning to have a say in what the equipment did.

The combination is familiar now. Its date is less so. This was a product pitch from an equipment company at the beginning of the century, delivered in the vocabulary of websites and compact discs. The ambition was already recognizable: connect instruction to the machine closely enough that the customer could follow along without continually reaching for the controls.

Making the hardware and delivering something worth following became two sides of the same commercial problem. A treadmill remains a large object after the excitement of its arrival has passed. Guided instruction gives its owner something new to do on it. Linking that instruction to the controls makes the connection more than a television placed nearby.

In June 2021, ICON announced that it was taking the name iFIT, after its software platform. The company then reported more than five million members across 120 countries. By that stage, filmed workouts included routes in the Alps, journeys toward Everest base camp and rowing on the Thames. The old equipment business had become a producer of things to watch and follow, too.

The family business meets the prospectus

Watterson’s career retained ties beyond the product catalog. From 2004 to 2007, he took a leave of absence to serve as a mission president in Taiwan for the Church of Jesus Christ of Latter-day Saints. He stayed on the company’s board. He also served on boards connected to Utah State, its foundation and the Utah Foundation.

The company had family ties of its own. In 2021, his brother David was chief strategy officer. Several of Scott’s children also worked in the business, including Mark, then chief experience officer. Family relationships were part of the formal business record as the company prepared to ask public investors to join it.

Control figured prominently in the proposed arrangement. The proposed offering would have left Watterson and affiliated holders with about 85.1% of voting power through a dual-class structure. That was a plan for a public company in which the founder’s group would still have decisive influence. Because the offering never closed, the percentage describes the proposal, rather than a completed public ownership structure.

There is an understandable tension in that paperwork. Starting a company requires decisions made by a small number of people. Bringing in public investors requires explaining how decisions will be made when many more people own a piece. Watterson’s proposed answer preserved considerable authority with the people already inside.

The offering that stayed on paper

In October 2020, ICON announced a $200 million growth investment led by L Catterton, with existing investor Pamplona participating. It reported revenue above $1 billion for the preceding twelve months and approximately 700,000 paid iFit subscribers. The equipment maker was attracting capital around a business that also collected recurring subscription payments.

The next year brought plans for a public listing. The offering was postponed in October 2021. By February 2022, the company was announcing a $355 million capital raise, with L Catterton as anchor investor, and a change in Watterson’s responsibilities. He would leave direct management, remain chairman and work with the advanced development team.

The transition followed staff cuts. That context belongs beside the funding announcement: money was being raised while the organization was making difficult changes. The listing plan did not recover. In April 2022, iFIT withdrew its public offering. Kevin Duffy became CEO that October, bringing experience from consumer technology and the audio business Sound United.

For Watterson, the shift separated the company he had helped start from the daily executive job he had held for decades. His announced next assignment remained close to products. The founder who had moved through imports, stoves and exercise equipment would spend his attention on what the company might build next.

A highlight reel, with room for another scene

When Watterson offered advice to aspiring entrepreneurs, his suggestions included optimism, gratitude and practice. One instruction had a pleasantly cinematic quality: mentally replay your own successes at the start of the day. It is a generous allowance to make before breakfast. Most people begin the day with a list of things they have yet to accomplish.

“Run a highlight reel of yourself each morning.”

Scott Watterson, advice to entrepreneurs, 2019

His own reel has plenty of material. A college partnership. A succession of products. Brand acquisitions. Internet-controlled equipment demonstrated when CDs were still part of the pitch. It also has a public offering abandoned and a transition out of management. A worthwhile account leaves those scenes in.

Today, Watterson serves as chairman and sits on iFIT’s board. His career has come back around to a deceptively plain question: what else could this company make? It is a question with room for several answers. In 1977, the answer was enough to turn down the summer job.