In this episode of the 20 Minutes VC, host Harry Stebbings interviews Philip Krim, the founder and CEO of Casper, a direct-to-consumer global sleep company that has revolutionized the mattress industry since its launch in 2014. Krim, a serial entrepreneur, discusses Casper's journey, including raising over $239 million from prominent investors, such as Leonardo DiCaprio, and the company's expansion into physical retail stores to complement its online presence. Krim emphasizes the importance of customer experience, product innovation, and strategic partnerships, like the one with Target, in driving Casper's success. He also highlights the challenges of scaling a complex business and the significance of hiring the right team, especially at the executive level, to maintain growth and prepare for a potential IPO. Casper's mission is to establish sleep as the third pillar of wellness, alongside diet and exercise, and to become a global sleep brand.
"He's created one of the world's most successful consumer products of our day. And so I'm thrilled to welcome Philip Crim, founder and CEO at Casper, the global sleep company that launched in 2014 offering perfect mattresses directly to consumers."
Explanation: Harry Stebings introduces Philip Krim, emphasizing his success in creating Casper, a highly successful sleep company known for its direct-to-consumer mattress sales.
"Personally though, I've always wanted to be in the startup entrepreneur side of the world, and this itch was something I started scratching back in college when I was a sophomore at the University of Texas."
Explanation: Philip Krim shares his longstanding interest in entrepreneurship, which began during his college years and led to his first company.
"We could help people sleep better by changing the way they think about and buying the products that are critical to getting a great night of sleep."
Explanation: Philip Krim explains how the founding team of Casper aimed to revolutionize the sleep industry by offering a better mattress-buying experience and focusing on factors that contribute to good sleep.
"We always wanted to give customers what they wanted. And in this category, mattresses and sleep products, they are highly considered product categories because they make such a big impact on people's lives."
Explanation: Philip Krim discusses Casper's retail strategy, which focuses on creating an exceptional in-store experience for customers, aligning with their desire to physically engage with sleep products due to their significant impact on life quality.
"Online, you have to spend to get traffic, you have to acquire customers through marketing channels with stores. The storefront themselves are actually doing the brand building and the customer acquisition lift."
Explanation: Philip Krim compares the economic models of retail and online businesses, highlighting how retail stores contribute to customer acquisition and brand building without the marketing costs associated with online traffic acquisition.
"They are a great acquisition tool because they give a consumer who's online shopping a reason to come into the store and talk to someone and learn about what the right products are and what our philosophy around our product design ethos is."
This quote emphasizes the role of retail stores in bridging the gap between online shopping and physical product interaction, enhancing customer education and brand philosophy communication.
"And we're really excited to have, I think, locked down a vision for what the stores could do to really create a sense of education, a sense of community, a sense of destination for sleep as wellness."
The quote outlines the strategic vision for retail stores, highlighting their potential to foster education, community, and a focus on sleep wellness, which is central to Casper's brand mission.
"I think the element that I'm probably most concerned about is just the level of complexity it brings."
This quote captures the speaker's concern about the challenges that come with expanding the retail footprint and the complexity it introduces to the business model.
"And if we get it wrong, then we create a lot of consumer confusion and it would be bad for the brand and bad for the business."
Here, the speaker highlights the importance of executing the retail strategy correctly to avoid damaging the brand and the business through consumer confusion.
"Your pillow matters. Your sheets matter. Your temperature of your sleep environment, your humidity, your dew point, sound, light all make a big difference to your sleep quality."
This quote explains the holistic approach Casper takes towards sleep, emphasizing the importance of various factors beyond just the mattress.
"We want to be the one stop shop, the end to end brand about helping people get a better night of sleep."
The speaker's statement reflects Casper's goal to provide a comprehensive range of products that collectively enhance sleep quality, positioning the brand as an all-encompassing sleep solution.
"We really have an amazing group of truly talented scientists and engineers and designers."
This quote underscores the investment in human capital and expertise that Casper has made to foster innovation and product development.
"Our mattresses are consistently rated the best mattresses out there."
The speaker points out the recognition Casper products have received, which serves to validate their approach to product quality and differentiation.
"We were never overly reliant on just Facebook or just Google."
This quote indicates Casper's strategic approach to diversifying its marketing and customer acquisition channels to avoid over-dependence on any single platform.
"It's become a meaningful part of the overall industry and we continue to be the number one market share leader in that space."
The speaker is highlighting Casper's leading position in the online mattress segment and the overall significance of this market within the industry.
"And we're going to continue to take meaningful share there. And I think that sets us up to really be the brand that is going to continue to drive change in this category, just as we've done over the last four plus years."
The quote emphasizes Casper's commitment to expanding its market share and influence within the retail space, aiming to be a leading brand that drives innovation and change in their industry.
"For Casper specifically, we want to be a material market share owner of this category, and that means we have to invest broadly in order to do that, to make sure that we're educating multiple segments of the mattress buying population."
The quote outlines Casper's strategy of investing in advertising to educate consumers and capture a significant portion of the market, highlighting the importance of investment in line with the company's growth and market share ambitions.
"We're very lucky to say that target has been the perfect partner for us. They saw the vision of what Casper wants to create in the world."
The quote reflects the positive outcome of Casper's strategic partnership with Target, indicating that the alignment of visions between the two companies has been beneficial.
"So understanding what the motivation is and then what they're looking to solve with the investment, I think is really important."
The quote advises founders to thoroughly understand the strategic investor's motivations and align them with the company's goals to ensure a successful partnership.
"For us, it really was a perfect alignment with where the business was and what the lifecycle was and our ambitions to build a very large company."
The quote highlights the strategic timing of Casper's large investment round, which was aligned with the company's stage of development and growth ambitions.
"Greg has had an amazing career at really Fortune 500 companies... And Greg has really helped us think about what are the right processes, what are the right ways to continue to build this business."
The quote expresses the positive impact of hiring an experienced CFO in terms of operational processes and strategic planning for growth and potential IPO readiness.
"I absolutely wish I had hired Greg and almost all of my leadership team earlier than when we know the trade off is always at the time."
The quote reflects on the desire to have brought on leadership team members earlier, acknowledging the trade-offs involved in the hiring process.
"We were in market for a CFO for a good amount of time, and it wasn't for a lack of meeting great cfos that were interested, but we really had a very specific view of who we wanted and the background and the role that they would play within Casper."
This quote highlights the careful and specific approach Casper took in hiring their CFO, underscoring the importance of aligning with the company's vision and the extensive impact the right CFO can have on the business.
"Certainly building the executive team that allows the business to scale. I think the other bucket is really making sure the business is capitalized for the business plan that you have in mind."
This quote encapsulates the dual focus of a CEO on building a strong executive team and ensuring the business has the financial resources to execute its business plan, both of which are essential for scaling.
"You go to war with the army you have, not the army you want."
This quote reflects the pragmatic approach to entrepreneurship, emphasizing the importance of making the best out of the current situation while striving for improvement.
"I read that, and then before that, I think I read the Elon Musk book, which is amazing."
This quote shows Philip's interest in stories of other entrepreneurs, both as cautionary tales and as sources of inspiration.
"I want to build. And I believe Casper will become a truly global brand."
This quote outlines the ambitious plans for Casper's expansion and brand establishment on a global scale, indicating a strategic focus on growth and international presence.
"I do want to say a huge thank you to him for giving up the time today to be on the show."
This quote reflects gratitude towards Philip for participating in the podcast and acknowledges the value of his insights for the audience.