'8 figures in 8 years': Steven from Sleepyhead

This transcript is edited/modified for ease of reading. Watch the full interview here on Youtube: 

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Steven, welcome to the pod!

Thank you for having me. 

 so the business is Sleepyhead and, it's really focused on being an excellent mattress topper. is that right?

Yeah. So premium mattress topper for college students, university housing, and anyone else that sleeps. 

And when did you start the business?

2016.

Were you in college when you started it? 

Yep. I was in school at the time and, realized everyone uses these, blue mattresses. you can't really,exchange those and people were bringing mattress toppers and felt like it was a really good market to go after.

And so a mattress topper basically just makes the mattress more comfortable?

Correct, yeah. More comfortable, more hygienic. You know, there's dozens and dozens of students that have slept on that mattress before you. So,that's a big key, you know, factor as well. 

And did you have a background in bedding or anything like that before? 

No, I was just an entrepreneur at heart and, had a couple little businesses prior to Sleepyhead that showed me the light, of the business world, I guess you could say.

And so when you started it, did you, receive a grant or anything, or were you just like I like this idea and I want to pursue it?

Yeah, I was, I was at the university, it's called Cal State, Northridge and they had an entrepreneur program. and so the first semester that I was there, it's a four year university. So I had transferred there. and they had a fast pitch competition the first semester that I was there. so it was like a two to three minute fast pitch. and I ended up placing second at that event and that kind of gave me motivation to, be better and do better and so forth. And I had felt really strong about that pitch. and so I ended up going in the second semester, they had what's called the bull ring, which is like shark tank style. so there was like 90 companies, all the way from undergrads, graduate students to PhD. that could compete in this. And, it ended up going from 90 companies to 20, to then, I think. five competed on a final like stage in front of 300 plus students and judges. And, I ended up winning that competition and that was 20, 000 cash and then a 15, 000 grant and like services. so that was really awesome. And that kind of solidified the idea, gave us enough money to start a website and we just, went from there. 

So did you drop out of school or did you finish college, while building this? 

Nope, I finished college. I ended up transferring to San Diego State University after I won that competition. I just felt that, SDSU was a better school for me to finish my degree. and I ended up graduating and Around the same time that I graduated, I raised a little bit of capital. So all of this was done, while I was in school, which is crazy to think about. 

okay, so now you've graduated college and you're starting to build this out. Do you have a founding team or do you have any co founders? what's your team set up at that stage?

I didn't, I'm unique in that sense. I was a solo founder. I had always had,the driving me to just do things by myself because I knew I was the only person I could rely on. but nonetheless, I had friends. Girlfriends, et cetera, helped me along the way as I was going, you know, I've been doing this for almost nine years now.

So there were people that, played a small part in, whether it's, an employee you want to call it or, a contractor consultant. And really I just call them friends, at the end of the day, but they were, in the business for anywhere from three months to maybe nine months at a time. and they would help out. And,some of them were paid, some of them are unpaid, but nonetheless, I did it all myself. 

How'd you figure out this whole, like manufacturing side of things and the supply chain? did you source things in, in, in Asia or did you start source things locally?

Yeah, I started out in Asia. we're now predominantly here in the U. S. I actually moved to Arizona a couple years ago, and we have a factory now here in Arizona. We also have one in South Carolina.and that's just taken time, but we started out in Asia. I think Asia is a really great spot to, to do R&D to get pricing, to really like just solidify the product andstart selling it if that makes sense. It's a lot easier to have, small MOQs in Asia than it is here in the United States. And that's for all sorts of products, even like boxes, for example. And yeah, we got started in Asia and then I found a manufacturer here in about like around 2018, I think, 2019, we started making foam here in the U. S. we've luckily we've kept with only a few, like a less than a handful of companies in terms of factories. so I've been really blessed about that. we've been doing business with a lot of these, we, with these factories for, over five years now at this point. So,yeah, it's, it was a journey, but it's possible anyone can do it with the internet now,

When you first found those factories in Asia, were you traveling there,to meet with different merchants going on, or were websites using vendors to, to get there? 

Yeah, I started out with, contacting 20, 30 merchants online. or I guess, factories, whatever you want to call them. and we, when I say we,I mean, I, but, narrowed it down to, to 20 and then narrowed 20 down to 10 and then 10 down to three. And then when it came to 3 companies, We had already done like the vetting,the researching, the sampling, the pricing, and really what differentiated between the three is the one at the time had a us rep in the United States.

And so,I got to jump on a call with him and he's like representing this company in Asia, and it sounded legit and they're, giant, corporation there. And, they're also in Europe and all sorts ofother countries. And so I felt really comfortable with that and we went in with them. So we eliminated the other two options, but I always had backups. So that's, that was a key thing that I realized. And still do till this day, like never put your, all your eggs in one basket. And so we still will manufacture slash produce like 25 percent of our goods with another factory, just in case something happens and there's things that can happen. There's fires, there's bankruptcies, there's product liability issues that could happen. like everyone's heard of these issues with the mold and the Costco mattresses, and there was ones with flame retardants and other mattresses. And we don't deal with any of that stuff, thankfully, but imagine if that happened and everything is at that one factory, your whole entire, supply chain is at risk. So yeah, that was a key thing. But yeah, I traveled to Asia once, after I had already been doing business with the factory just to meet them in person, but also get a feel for other factories. And I really felt comfortable with the company that I was with at the time. 

How big are you guys now?

Yeah. we're definitely out of the startup stage. we're North of eight figures now. and we're growing like almost a hundred percent year over year. well over a hundred percent year over year. And so it's a, it's been a grind though. it, since COVID really was the time that we, COVID was like a reset year for us. And we had just been getting started 2019. That's when I graduated university and 2020 happened and we were just told to survive.

And so since 2020,the year after 2020, we tripled in sales. The year after that we tripled. and then the last couple of years we've been just doubling in sales and, as it, as you grow in more revenue and go over 10 million, it gets harder to continue to double every year. And, we're, yeah, we're definitely in a good positionand it's just been a grind to get there though. I think a lot of people don't realize that,to, to hit eight figures. I call it eight figures in eight years because that's when I started to when I hit eight figures, it's ait's a grind. And so we've been fortunate to also along the journey, be able to buy out some investorsand allow me to retake some ownership of the company. And so,we're in a really good spot now as well. and there was a lot of, headaches and heartaches over that period of time. We had a, a partner rip off our product. We had, another partner that of ours go bankrupt. we had a container company that we shipped with go bankrupt.

So it's been a journey. 

What do you think is giving you confidence that you guys are going to be able to grow, at the same rate again this year?

Yeah. I've always been very conservative. And I think when you lean on the side of conservatives,you really have to do what you say you're going to do, if that makes sense, because this is like I absolutely feel at least this amount. And I'm going to make sure that we get there in that sense. And what I typically do now that we have a solid three or four years worth of data, I can see trends when they happen and I can see, metrics as well, percentages, year over year or a month over month, et cetera. And if that continues to stay in the right direction, I can almost assure you at a very high confidence level that, that we're going to double or get close to it.

And so that's really what, that's really what I look at. And we make typically three projections as well. We make a floor projection, and then we make a good, better, best type of projection. and so technically four projections, but the floor is like. This is absolutely what we're going to do no matter if this year sucks ass.

And that floor is usually at 50 percent and then we just build up from there. So go like 75 percent growth, 90 percent growth, a hundred percent growth. And so when we start seeing okay, last January compared to this January. And we're seeing like, Oh, it's up a hundred percent.

Then that's a pretty good indicator that we're going to probably be at that top line, projection. and then you get, into February, into March. And if it continues that way, you're more likely going to end up in that upper,tier projection. but it gets tough because a lot of our business is seasonal. We will do in one month in January, we'll do that in one day in July. And so that's the numbers get a little bit more challenging. 

What are some of the tactics you got cooking for this year? 

I think 2025 is going to be a year of just sustained growth. And what we do every year is just double everything. And so not necessarily everything is doubling in span and so forth, but we typically try to, shoot for around there. in layman terms, if we spend a million dollars on Facebook ads last year, we'll spend 2 million on Facebook ads this year.

If we had 50 influencers last year, we'll have 100 influencers this year. If we had 50 affiliates, we'll have 100. And Or if affiliates X number in, revenue, et cetera, we'll double it. And, and so that's really at this point what's proven to work for us. and then in addition to that, we would really love to get into,all the affiliate programs on Amazon on YouTube now has an affiliate program,to talk shop, you know, um, debatable if, if.

They're going to stick around, but it looks like they will. I think everyone lost their mind for 12 hours yesterday when Tik Tok got banned in the United States. but it's back. And, so I think really that is the growth moving forward as well. Now, is it going to be like a significant amount of sales coming from that?

No, because the reality is our consumer is still very much. Driven off of meta and I think that is for most companies like anyone you talk to it's hey Where are the majority of your sales coming from meta is just that og Machine that just doesn't stop producing results. yeah, and so Yeah, we're excited though with affiliates and influencers and you guys have been a tremendous help as well Like keeping our business tight as well Yeah, so that's gonna be my last question before I let you go, but obviously we've gotten to meet each other through Storetasker, and it's been awesome to work with you guys, and I don't want to put too many words in your mouth, but I do think of,modern DTC brands being able to leverage fractional talent as being in an advantageous position, and I feel like you guys are the prime example of that, so, Y

What's your setup with StoreTasker? Who are you working with from our expert pool and how has that experience been? 

You guys as just leaders of StoreTasker have been super helpful. We've gone, we've gone through a few different people on Storetasker from web developers.

We use a guy named Tyler. He's been, there whenever we need him. We've done, other stuff like you helped train one of our marketing people on Google ads. I believe Caitlin helped with that from your guys team. and you know, just being able to stay up to date with marketing, we'll touch base and say, okay, we need someone for email, and we just our team is mostly internal. everyone, except for one, one or two people are in the office. And, we always want to stay, up to date with the latest practices. So we're not using like agencies as much as we used to when we first startedor really at all. And so we want to leverage Storetasker, cause you guys always have top talent, typically people that have come from the agency world and, really use their skill sets. These guys are, these guys and gals are usually like 10 plus years experience. where our, in person team is typically like one to three years or so and so they love learning from you guys. You guys help out a lot and i'm just impressed like your guys's roster from when I started to now it's like The companies that you guys are pulling from you know, Red Antler and Warby Parker and Harry's and,it's wild because that's the generation of DDC that I grew up in, was that kind of, Casper, Warby Parker,type of generation almost a decade ago.

We're big fans of, of you guys. And all, and all these talents that you spoke about they're loving,working with the next generation of startups like you, in the DTC space. So, yeah, thanks so much.