This may be the city that never sleeps, but if you are getting sick of perpetually staying up and need quality sleep, Helix Sleep can help you out. With trained doctors uncovering the science behind sleep and mattress specifications, this is not your run of the mill mattress…it’s customized. Finally breaking out of the mindset of soft medium or hard, Helix customizes for your sleeping position, back/spine comfort, and any other relevant sleeping conditions you have so you can enjoy that third of your life you spend on that plush rectangle. With over $50M in revenue in just its 2nd year in business they have created an extra firm company with great support.
AlleyWatch chatted with Cofounder Adam Tishman about Helix’s recent round of funding and how they are redefining what a good mattress company looks like.
Who were your investors and how much did you raise?
Helix Sleep announced a Series A round of $7.35 million. Investors in this round include: Double J Capital, Simon Venture Group, Western Technology Investment, Great Oaks VC, Jesse Itzler (Cofounder Marquis Jet, Co-owner of the Atlanta Hawks, Jonathan Klein (Cofounder & Chairman of Getty Images).
Tell us about your product or service.
Helix Sleep makes sleep more personal as the first direct-to-consumer sleep brand that uses cutting edge data and analytics to create individually personalized, custom-made mattresses for individuals and couples at less than ⅓ of the average retail price. Each mattress is tailored to the consumer’s body type, sleeping position, and mattress preference. This customization helps to optimize spinal alignment, which is associated with improved REM sleep efficiency, higher reported sleep quality, and reduced neck & back pain. We use premium materials for comfort and durability, and ships throughout the US and Canada to deliver an unprecedented level of comfort directly to your doorstep.
For couples, Helix Sleep offers “dual comfort” beds, personalizing one side of the mattress to one partner and the other side to the other partner. For those that can’t choose a side, the company can also find the happy medium through its “blended” mattress option.
We firmly believe in the data, which shows individuals have different needs and preferences and therefore a “one-feel-fits-all approach” isn’t best for consumers. Helix Sleep was built to empower individuals to be the best version of themselves, and being the best you starts with how you sleep!
What inspired you to start the company?
We were inspired by terrible experiences purchasing mattresses (and the ensuing sleepless nights), and we worked with sleep ergonomics PhDs, who had researched mattress personalization for four years, to develop the basis for the company’s constantly improving algorithm.
How is it different?
We are different from competitors because we are the only online company personalizing mattresses based on body type, sleeping preferences, and mattress preferences in order to build each consumer’s perfect mattress. In addition, we are the only online mattress company offering mattress solutions for couples, including “dual comfort” mattresses which personalize each side of the mattress for each partner, and a “blended” mattress which takes the preferences of each partner in consideration to create a mattress that works for both.
Helix Sleep’s sleep quiz asks simple questions about body type (height, weight), sleeping preferences (back/side/stomach, hot vs. cold), and mattress preferences (firm vs. soft) in order to build each consumer’s perfect mattress. Helix Sleep’s technology then uses this data to algorithmically map to a generic 3D human body model and then evaluates the ergonomics of a body on different materials to individually personalize the mattress design for each person according to who they are, what they like, and how they sleep.
What market you are targeting and how big is it?
The retail mattress industry is a $15 billion industry in the US with huge growth in the direct-to-consumer ecommerce segment.
What’s your business model?
We are a direct-to-consumer brand that sells through our e-commerce and showroom channels. Because we sell directly to our end customer, we’re able to cut out a lot of extra margin inherent in the mattress buying process that makes beds expensive at most retail stores. That’s why our mattresses are in the $600-$1,000 range and not double or triple based on the high quality of materials that we use.
Additionally, our business model is predicated on providing the best possible product and experience. This manifests itself through our devotion to taking a data driven approach to product development and a human driven approach with our customers.
How do you consider customer LTV in your business where people are not buying mattresses often?
There are certainly trade-offs with different types of business models when it comes to thinking through your CLV and CPA analysis. Certain companies have much more repeat business, but high upfront acquisition costs. Other companies see that customer value much faster, but have longer repeat purchase cycles. Currently we’re closer to the latter category, but have plans to continue to grow our product lines and achieve our goal of providing a truly personalized sleep for our customers.
What was the funding process like?
Let’s put it this way: if you want to experience the full range of human emotions, go through a fundraising process.
What are the biggest challenges that you faced while raising capital?
The biggest challenges we faced while raising capital is staying focused on your #1 goal – continuing to run and grow your company. And it’s challenging to do that when you’ve set up a ton of meetings and follow up meetings. But investors know this and I think it’s okay to be honest with them. You’re allowed to set expectations on your side as well.
What factors about your business led your investors to write the check?
We are unique in what we do in the industry because we are the only direct-to-consumer customizable mattress company in a growing and large market. We care deeply about our customer and we nerd out on analytics and really understanding our numbers. And we were prepared to answer tough questions with honest answers.
What are the milestones you plan to achieve in the next six months?
Simply put, we want to change the way people look at the sleep category. This means continuing to grow our brand through testing new marketing channels, growing the team, and investing in R&D.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
If you need to make decisions on cutting back spend, try as hard as you can to keep those decisions away from hurting your product or customer experience.
Where do you see the company going now over the near term?
We’re interested in continuing to test new marketing and distribution channels as additional avenues to find scale. We also have some exciting product development in the works as well.
Physically though, we are here in NYC to stay. 🙂
Where is your favorite bar in the city for an after work drink?
We just moved offices to be near Madison Square Park and we’re really liking Flatiron Hall, but we always make sure to keep a well stocked office.