Answered produced feed
D 5 · C 5 · P 4 · Cm 4 4.60
Q really is just a mattress company, the valuations can be way lower than if they're a pure tech company. So to your credit, I went back and watched your very early interviews, and you always describe this as a technology sleep performance company, never a mattress company. How did you know going in that that was going to be the focus versus just, you know, another mousetrap DTC mattress product?
A Yeah, a couple of different things. The most obvious is my co-founder, Max. He's the CTO. He would have never started a mattress company. He told me since from the beginning, if he's a mattress company, I'm out. So I have no chance. Um, and second, more than anything, um, I mean, there are good brands in the DTC space, so I have respect for them, but they are really selling a commodity that is foam. If today you call a mattress manufacturer in the US, just a factory, you can buy foam on your own, and you can start the business tomorrow on your own. What we are doing here is cutting edge Technology that require millions of dollars to be developed and some of the best machine learning engineers in the world.
AI assessment note: “The most obvious is my co-founder, Max. He's the CTO.”
Answered produced feed
D 5 · C 4 · P 4 · Cm 4 4.30
Q Let's go back and talk about pre-Kosho coming in in 2018. Uh, you had this mattress topper priced at 399 bucks. You also did have a mattress, uh, for 999 bucks. Your mattress, at least the queen size today, is listed at 2845. So significant pricing in your testing between the two products. Why start at nine 99 and how do you get up to 3800 today?
A Yeah, there's another great question. So at the time, obviously we didn't have the cooling. The cooling is, is the big elephant in the room for sleep improvement and in terms of product market fit. Uh, so we were really trying to make a smart bed position like most of the other B to C brands. Um, after KV came in, um, and, and Keith joined our board together with Delian, we really started rethinking our Keith Raboy and Delian. So we started really, really thinking about our brand positioning and what we wanted to build. Obviously the product became immediately more expensive because of the new technology. So there was no way to be at the thousand bucks, but more than anything, I mean, there is this theory, which I believe comes from Marc Andreessen, where great products, you can keep increasing the price and people will pay for that as long as you keep delivering more value. And I think that is what happened compared to then probably our conversion rate on the website CVR is probably three X what we had back then, but our AOE is three X as well.
AI assessment note: “the product became immediately more expensive because of the new technology.”
