How a Med School Student Reinvented the $40B Mattress Industry

Buying a new mattress has never been fun or easy …

You go to a store and sprawl out on multiple models of beds from numerous companies, each with various levels of firmness or softness. All while being stared at and hounded by a salesperson looking to make a commission.

It’s awkward and, after spending a couple thousand dollars on a product you’re not 100 percent sure about, rife with buyer’s remorse. Casper co-founder and COO, Neil Parikh, attunes it to buying a used car — it sucks.

Sometimes it’s necessary for things to get shaken up a bit in order to make advances in an industry. And that’s exactly what five young men did to the mattress industry in 2014 by launching Casper, an innovative mattress company with a clever business model, outstanding customer service, low prices, and quirky ads.

So, how did Casper put a new spin on an ‘old-school’ industry?

The Beginning

None of the founders had dreamt of becoming leaders in the mattress industry. In fact, Parikh had been accepted into med school (oddly enough, his father is a physician specializing in sleep) before switching gears and focusing on mattresses.

It wasn’t until he lived in a walk-up fourth floor apartment with fellow co-founder, Luke Sherwin, that he realized you couldn’t easily get a mattress up four flights of stairs. This spawned the question: what if you could fit a mattress in a box and have it delivered to your door? It would save money on delivery costs and make it easy for customers.

The difficulties of mattress delivery coupled with all-too-often poor mattress-purchasing experience made them realize that the industry was desperate for reinventing.

Sleep Reinvented

The founders felt that the mattress industry was broken, and they set out to change that. They quickly realized that it wasn’t just the mattress industry that needed to be fixed, it was a whole new industry centered around sleep that needed to be created.

According to Parikh, the question was “how to solve a more interesting, higher order problem; to inspire people to live a better life.” People care about their health, more so now than ever, and sleep is a crucial part of living a healthy lifestyle.

The American Sleep Association states that getting good sleep improves cardiovascular health, aids in learning and focus, helps with weight loss, and increases longevity. Casper aimed to tap into this largely underrepresented market, so they flipped the whole mattress business model on its head.

Initially, the company only offered one style, which is unheard of in an industry where you can usually choose from seemingly unlimited options of springs, layers of foam, and firmness.

After eight months of testing hundreds of mattresses, they found that 95 percent of people all desired the same thing. They developed the first model with memory foam topped with open-cell latex foam. This gave the support, bounce, and temperature control that most people wanted.

The mattress is packed into a box that is roughly the size of a dorm room refrigerator and delivered to your front door for free. You have 100 nights to sleep on it risk-free, meaning that you can return it for a full refund if you’re not satisfied in those 100 days.

They will even come get it from you for no additional cost. Rather than taking it back to the factory and refurbishing it, they usually donate the mattress to a local charity, which is more cost-effective. Incredibly, their return rates are less than 10 percent.

Obsession

If you thought the mattress industry was boring, you should listen to Parikh talk about his company. He is both passionate and inspirational and he says that the company is “obsessively focused on delivering the best products for sleep out there.” Claiming to be more of a tech company than a mattress company, they are at the intersection of health and technology.

They have an obsessive focus on developing new and better foam for their mattresses as well as providing the very best customer experience. It certainly shows in their sales and rave reviews. Even the few who have returned the mattresses have left shining reviews about the company and its customer service.

They didn’t expect the response they received when Casper.com went live on April 22, 2014. Their entire inventory at the time consisted of 40 mattresses. What they expected to sell in the first six weeks sold in a matter of hours. In one month, they had sales over $1 million. Within eight weeks they had surpassed their 18-month sales goal.

As exciting as the number of sales was, the manufacturing took some time. Not wanting to make their customers unhappy, they fixated on solving the problem of the lengthy delivery times.

If it took longer than a month, they would have AeroBeds shipped to their customers to tide them over. When the Casper mattress did ship, they included gifts such as vintage, leather-bound books. Since then, they have kept track of their customers, sending them anniversary gifts and pet beds.

Parikh says that “if you take an amazing product, and back it with amazing service, actually, most people are gonna like it.” Now, Casper is selling internationally and has 20 stores across the United States.

The Future of Sleep

Since Casper’s launch, several copy-cat mattress brands have surfaced, but they all lack the excitement, the obsession, and the quirkiness that makes the Casper brand so unique.

And Casper isn’t stopping at mattresses. They have developed a whole line of sleep products ranging from dog beds, to lights, to sheets, and of course, pillows and mattresses. Each item is just as obsessively designed as the previous.

Last year, Casper opened a napper’s paradise adjoining their mattress store in New York. The first of its kind, they call it The Dreamery. For a small fee, you get everything you need for a nap, including a quiet sleep pod (with a Casper mattress, of course), pajamas, toothbrush and comb. You get 45 minutes to rest and recharge. There’s also a lounge that allows you to decompress before heading into your nap, then re-energize afterwards.

According to Eleanor Morgan, Senior Vice President of experience at Casper, “we’re very much trying to destigmatize sleep and napping.” They are not just reinventing the mattress industry; Casper is inventing the sleep industry.