Former Billionaire Peleton co-founder, John Foley, Recently Revealed He Has Lost His Fortune

The Rise and Fall of John Foley: From Billionaire to Financial Struggles

John Foley, the co-founder and former CEO of Peloton Interactive Inc., has recently revealed that he nearly lost all his money after leaving the company in 2022. This dramatic turn of events highlights the volatility of the tech industry and the risks associated with stock-based compensation.

Peloton’s Pandemic Boom and Bust

Peloton was one of the hottest commodities during the COVID-19 pandemic, as people sought home fitness options. The company’s valuation skyrocketed from around $8 billion to nearly $50 billion by the end of 2020, with sales climbing by over 170% and stock rising by more than 400%.

However, as the pandemic restrictions lifted and people returned to their pre-pandemic workout habits, Peloton’s stock price plummeted. By November 2021, the company’s stock had taken a significant hit, and by 2022, Foley had stepped down as CEO amid the company’s financial difficulties.

Foley’s Financial Downfall

Foley’s wealth, which had peaked at $1.9 billion, was largely tied to Peloton’s stock. When the company’s valuation dropped, so did his personal fortune. By the time he fully exited the company in September 2022, his wealth had dwindled to around $225 million, a staggering 87% loss.

The financial impact was severe, forcing Foley to sell almost everything he owned. This included selling his $55 million East Hampton waterfront home, which he had to downsize twice, and a Manhattan townhouse for $35.5 million.

Personal Adjustments and Family Support

Foley’s financial struggles have also led to significant personal adjustments. He has downsized his living arrangements and sold several high-value properties, including a $55 million oceanfront estate in East Hampton. Despite these challenges, Foley’s family has been supportive. “My family took it well,” he said. “My wife’s super supportive. My kids are probably better for it, if we’re keeping it real”.

New Venture: Ernesta

In an effort to rebuild his financial standing, Foley has launched a new venture, Ernesta, a New York-based home décor company specializing in made-to-order rugs. He has raised $25 million from venture capitalists for this new endeavor and has enlisted several former Peloton executives to join him.

Foley is optimistic about Ernesta’s potential, believing the company could achieve a free cash flow of $500 million by the end of the decade. “I’m working hard so that I can try to make money again… because I don’t have much left,” he joked. “And so I’m hungry and humble”.

Lessons Learned: The Volatility of Tech Wealth

Foley’s experience serves as a cautionary tale about the risks of relying on stock-based compensation and the volatility of the tech industry. His story underscores the importance of not tying one’s self-worth to financial status, as wealth can fluctuate significantly.

As Foley himself noted, “I think, potentially, the best days of John Foley are ahead of me. I love a good underdog story.” This sentiment reflects his resilience and determination to rebuild his financial future.