Helix Sleep is an e-commerce startup that sells individually personalized, custom-made mattresses. TAP-NY paid a visit to the Helix Sleep showroom and headquarters in New York’s Flatiron district to meet with Taiwanese American co-founder, CFO and COO Jerry Lin. Now in its third year of operation, we learned how his background has played a role in the company’s founding and subsequent growth.
Jerry, can you tell us the long version of how Helix Sleep got started?
I’m originally from Portland, Oregon, studied Economics and Finance in college in Los Angeles, and after wanted to do the whole banking thing so I got a job at Goldman here in New York. After 2 years I got tired of the finance rat race and wanted to get my hands dirty with investments and operations, so I landed a job at a small private equity fund back in LA and moved back to the west coast.
After a few years, my dad gave me a call and told me, “It’s about time you come back home, help with the family business and repay some of your college tuition.”
So like a good eldest Asian son, I moved back home to Portland and took up the opportunity to help my dad. He and my mom came over in the early 80s from Taiwan and began by running a motel in Torrance. My dad has a crazy story actually. He started a company when he was very young and built it from nothing.
When I joined the company it was a great opportunity to see what he’d built. My family is in the packaging industry – not the sexiest business you’ve ever heard of. We make paper bags for industrial products, such as dog food bags, flour bags, and salt bags. It’s super random, but someone’s gotta make them.
Through this experience, I got to see what it’s like running a business, working with suppliers, hard machinery, and tangible products, versus finance where you’re sitting behind a spreadsheet punching in numbers. When running operations in manufacturing, you’re making those numbers come to life. Through this I realized I wanted to further my education and decided to apply to business school and thankfully got into Wharton.
At Wharton I threw myself into the entrepreneurial environment. It’s one of the great things of that program as there’s a good foundation for people who want to get into startups. The founders of Warby Parker and Harry’s also came from that program, and as a result there’s a lot of discussion around what e-commerce is doing to disrupt all these different product categories. It started with shoes, clothes, eyewear, then moved to razors.
When I moved to Philly, I had a bad experience in buying a mattress for my apartment. I didn’t understand why the process had to be so confusing, inconvenient and expensive. These mattresses only cost a couple of hundreds of dollars to make; why does it cost the consumer thousands of dollars? I met two other colleagues of mine who were also interested in this idea and question, and also had a similarly bad buying experience. And thus Helix was born.
As we went through the program and worked on the business, there were competitors that came to market doing what we were thinking about doing. What we realized was everybody was doing the same thing which was making one mattress and marketing it as “hey this is the best mattress for everybody”.
But you and I know that’s not the case. You may like something soft, someone may like something more firm, I like memory foam, some may like latex. People sleep differently. We have different needs and preferences, and that’s what is so fundamental to the Helix brand and mission. People are different and they deserve different products.
In school we did a friends and family round and built the initial website, worked with a supplier, and launched in August 2015. Over the past three years we’ve grown it from 3 founders to a team of 25. We’ve extended our product line from just mattresses to foundations and pillows, sheets. And we’re super excited about continuing to build the brand and see where we can take it
How has your day to day role evolved over these 3 years?
In the very beginning, as a founder you’re doing everything. You’re ordering the coffee. Well, I still order the coffee. Especially from my background coming from finance, manufacturing and operations, as the CFO and COO of the company. I’d say in the beginning it was a lot about execution. You roll up your sleeves and if there’s something you don’t know you just have to unpack and get into the weeds. You really have to understand the product. In the beginning it was also a lot of research and learning because none of us came from the mattress industry, so we had to understand what foam was, differences in fabrics, what were springs, how do we ship this mattress inside of a box, what’s that going to cost us.
As we’ve grown my role has shifted from execution – and we’re still at the stage where we’re still doing some of that – but it’s transitioned more into coaching, recruiting and thinking about strategy. As leaders of the company we need to be conscious of how the changing dynamic of the industry shapes our strategy and we need to make sure we’re charting a course and delivering that message to our team. I think that’s one thing I’ve learned tremendously is how important it is for the management team to be continuing to figure out what the right strategy is and then communicating it appropriately to the team so everyone understands this is where we’re going, why we’re going there and here are the things we need to achieve to help us get there.
It’s been a learning process and we’ve made a lot of mistakes, but I think we’ve come out of it with a much stronger team that’s helped us give us that feedback.
What’s your favorite story from the founding of the company?
One of my favorite stories is from month 6 of meeting my other two co-founders, Adam and Kristian. As I mentioned, we didn’t know anything about mattresses, and we needed to find some industry partners or experts to help us think through how to design the product. Through some research online we found a PhD scientist from Belgium who had written this huge dissertation on different sleep systems and body types. He was literally the fundamentals of what we wanted to build. Through a cold outreach we emailed him and he responded. He said, why don’t you come to Belgium and we can talk about potentially a business partnership, maybe I can be an advisor or investor. We happened to be going to Europe anyways for a business school trip to Oktoberfest, so why not swing by Belgium on the way back?
We ended up meeting him in the middle of Belgium, we went to his lab and talked about his philosophy and struck up a deal. I remember, Adam, Christian and I having a celebration that night in the middle of this square drinking Belgium beer, eating mussels, doing a round of cheers and thinking to ourselves – this is it, we’re building a mattress company.
Can you talk about the dynamics in your industry today?
I think incumbents in the industry have recognized the changing dynamics of consumer behavior. They’ve had trouble selling directly to consumers themselves and we’re seeing it in the mattress space now with Simmons, one of the biggest traditional brands, recently purchasing Tuft and Needle. For the longest time, if you listened to what they were saying when e-commerce was just coming to market, people talked down on it: it’s just a fad, it’s going to go away, these products are terrible, etc., and now e-commerce brands represent almost 15-20% of the market.
Because of the channel conflicts that certain brands have with traditional brick and mortar retailers, they haven’t been able to build brands online and develop that direct-to-consumer relationship that we think is representative of how people purchase nowadays. You don’t want to bet against the internet, and I think it’s an exciting time for digitally native brands who have come to market and have been able to scale quickly due to digital channels. For us, we’re thinking through how do we continue to be different, because it’s highly competitive. We’re continuing to build a brand that’s focused on this concept that fundamentally we want to build products and services that serve different needs and wants and we’re excited about that.
How has your dad’s experience impacted and inspired you?
My family, especially my dad’s side, is filled with entrepreneurs. My grandfather owned a huge construction company in Taiwan. When my father came over here with my mom, he took the same spirit and started a motel, and when I popped out, he somehow felt motivated to start something new again. Through a series of connections, my grandfather had a friend running a plastic manufacturing company in San Jose. One of their salesman wanted to find a source for paper packaging but couldn’t find a supplier. So, demand meets supply, and that’s how the packaging business got started.
Through that connection, my father bought equipment from Taiwan, moved the family to Portland where that salesman was, set up shop and purchased some land. Unfortunately within six months of moving the family, just having me, and installing all of his equipment, his business partner passed away from cancer.
So my dad bought a pickup truck and drove all the way down the I-5 into California where all the farms are, and stopped by every single one and pitched, “Hey, I have a bagging plant, do you want to buy bags from me?” And this company is still running thirty years later.
It’s pretty nuts thinking about what he was able to do, and his courage and tenacity. That hey, I don’t care they don’t understand the English I’m speaking but I’m going to do this because I need to. It’s crazy thinking of the foundation he built. If you were to drop me in the middle of, say, Russia, and told me to build a manufacturing plant, I don’t know if I could survive.
I think a lot of Asian Americans who had parents who immigrated here might share similar experiences as I did. Which is that my parents worked a lot as I was growing up. The message from them to me and my siblings was: don’t go through what we did. It’s really tough to build your own business. Go to the best school you can, preferably Ivy league, become a doctor or a lawyer, go to grad school, and get the best, most stable job you can.
I felt like I followed that path, at least to the best of my abilities, but as I got older it’s funny to see how my parents have really switched their message to me. Now it’s like, don’t go to school, don’t go to that job, don’t start your own business are you crazy, actually come back to our business and help out so that we can retire. It’s funny how they’ve done a complete 180 as we’ve gotten older – they want to take what they’ve built, their blood, sweat, and tears – and pass it on.
But for me personally, similar to what my dad’s gone through, I want to go through that same fire. I want to go through the same experience of growing a company and building something from nothing. And who knows, if I do go back to the family business, maybe I can be a better leader and help take that business to the next level.
What do the next few years look like for you and for Helix Sleep?
I think we’ve built the right foundations to really scale an interesting, niche brand. We’ve been focused on our mission of creating different products that serve the different needs and wants of people. Now that we’ve built this product suite digitally and proven we can scale this business online, we’re very interested in pursuing an omni-channel strategy. We’re currently sitting in the showroom now, and I think it’s a unique experience – very different than going into a traditional mattress store and awkwardly laying on the mattress while the salesperson looks at you.
What we’ve created here is a much more personalized experience where you can book an appointment and we can actually build a mattress right in front of you and give you the time to sleep on it. We’re trying to change the buying experience completely both online and in-store.
Over the next 3-5 years we’re very bullish on this: where similar to Bonobos we can have “fit shops” with low square footage but a very personalized experience. You’re asleep for a third of your life, so you should make sure that what you sleep on is the right fit for you. And we’re also interested in expanding into different categories – if you think about our core competency we know how to scale digital brands quickly especially with large physical products, so we’re thinking through other bedroom and home items that we can create that people resonate with.