Just over three months after filing for Chapter 7 protection in bankruptcy court, Netpulse has risen like a Phoenix, breathed back to life by its retired CEO and Intuit co-founder Tom Proulx.
Proulx, a secured creditor of Netpulse Media Networks Inc., traded his creditorship for the company's remaining assets, said company spokesman Adam Handelsman, who did not name an exact figure. Handelsman said "minimal cash" traded hands in the transaction, which was announced May 3 in San Francisco. After Chapter 7 was announced, Proulx was said to be seeking to raise $6 million to get the company back.
The deal allows the 300-plus clubs around the country with Netpulse stations - which give gym-goers the ability to surf the Internet while sweating it out - to get back to the business of manufacturing and selling Internet stations for fitness equipment, as well as making sure clubs are back on-line.
Netpulse is one dot-com story that didn't become dot-dead. It now has what Proulx calls a "real business plan," as companies pre-dot-com economy used to have. Actually, Netpulse began pre-dot-com but was over-run with dot-com hysteria in 2000 when it started giving away its equipment and services in an attempt to quickly acquire market share. Originally, those surf-and-sweat stations ran for $4,000, and clubs also paid for monthly services.
Its competitors (E-Zone and Xystos) followed suit with free equipment. Then, in September 2000, the three merged. But that didn’t help either.
Netpulse stations will again be sold, and fees will be established for services, plus advertisements will help boost income to support the company, Handelsman said. "It's back to what it originally was," he said. "It's a shame it had to go this route to get there."
One backer included Life Fitness, which signed on for an alliance with Netpulse in March 2000, and was a bit shocked and dismayed when Netpulse filed for Chapter 7 protection.
"Life Fitness is certainly pleased to see them coming back," said spokeswoman Julie King, "but we're not eager to jump back in, although we believe that interactive media is important to keep people motivated. We'll wait to see what happens before we do anything."