Not only did mattress startup, Casper, reach an impressive $550 million valuation in just a couple of years, but it began with an objective quite different from most of Silicon Valley’s famous tech unicorns. The startup aimed to penetrate an already saturated, niche market for mattresses. And it succeeded.
Luke Sherwin, Chief Creative Officer and co-founder of the mattress startup had an inkling. The New York-based online mattress retailer launched in 2014, although at this time there were many online retailers in the business.
The Power of a Disruptive Idea in an Old Industry
Casper “disrupted” the concept of mattress retailing by offering one mattress shipped inside of a simple box. With fewer options for consumers and one perfected recipe, there was less consumer decision, resulting in minimal returns, and overwhelmingly high customer satisfaction. (To learn more, read: How Does Casper Work and Make Money?)
Casper's sales page is what gave the product a competitive edge over other, more established retailers. The “100-night trial period” or your money back is a tactic rarely used by traditional mattress companies. Further, the mattress industry disrupter directly targets millennials, via online and traditional ad campaigns, aggressive social media, and ads on city taxis and subways.
Customers were on board with the “100-night trail” promise, funneling in a whopping $1 million just 28 days after the startup’s launch in April of 2014. Currently, Casper holds its place as one of today’s fastest growing consumer brands. In less than two years, Casper generated $70 million in venture capital from investors such as Ashton Kutcher and Leonardo DiCaprio. Casper’s latest Series B financing round attracted $55 million in investment, with a pre-investment valuation of $500 million, according to a TechCrunch report. The latest round beefed Casper up to a post-money valuation of $555 million.
The Bottom Line
Casper has grown into over a half a billion dollar company using unique sales pitches and strategies directly targeted at younger generations via social media and city transportation advertising. As Casper expands into other product categories, it hopes to be a one-stop shop for customers, with faith in the one-size fits all recipe behind the mattress startup’s success.