You're listening to TED Talks Daily. I'm Elise Hume. Private equity investors take pride in making companies lean. They are known for coming in and cutting jobs in order to increase profits. Impact investor Warren Valdmanis says that's an outdated way to think about business. In his 2021 talk from

TED at BCG, he makes the case that companies who care about their workers physically and

psychologically can see benefits in their bottom lines, too. In 1995, a fellow named Chris Klebba

decided to open a gym in his hometown of Northville, Michigan.

Fitness had changed his life, and he wanted others in small town, Michigan, to have the same experience.

But the problem with gyms is they can be intimidating. It's the ultimate irony. You go to a gym to get in shape,

but if you're out of shape, you feel like you need to get in shape, but if you're out of shape,

you feel like you need to get in shape just to show up.

That's why as many as 50% of gym members quit within the first year,

which is fine if you open a gym in New York or LA with millions of people.

But in a small town, you might simply run out of customers.

Now, many gyms try to solve this problem by making

it difficult to quit. So now, not only am I feeling guilty about not going to the gym, but I'm

stuck paying $100 a month, and I'm still not getting any thinner. But Chris decided to do something

different. Chris decided to invest in his workers. He hired

overly helpful, overly friendly employees who at any moment were eager to step in and help you

learn how to use a piece of equipment without making you feel like you're being judged.

The idea was for the 55-year-old mom or dad who'd never been to a

gym before in their lives to feel welcome and comfortable immediately. Now, my question, as a private

equity investor, is, could this really be profitable? There's an old joke about a man who's had

too much to drink looking for his

keys under a streetlight. A cop comes by and offers to help and ask where he thinks he lost

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