Tuft & Needle: Two local entrepreneurs reimagine the mattress business to great success

Tuft & Needle tuft-needle-team

Two local entrepreneurs reimagine the mattress business to great success.

By Matt Gottesman


It’s 3 p.m. and I’m sitting at a café in Scottsdale speaking to two commercial real estate executives tasked with supplying the city’s “who’s who” with the ultimate tech space.

As we talk, one of the execs asks me, “Have you heard of Tuft & Needle?”

Intrigued by the name alone, I said, “No, I haven’t.”

They said, “You need to.”

They then proceed to tell me about this Phoenix-based mattress company run by two former Silicon Valley tech guys and the extreme growth they’ve experienced over the past two years.

Growth is a serious understatement!

When you take several thousand dollars and turn it into $1 million in your first year, $9 million in your second year, you are doing something very right.

Couple that with being the number-one rated mattress on Amazon and an intense focus on the customers’ overall experience, and you’ve got an insanely disruptive force to reckon with in an industry with a lot of price gauging and over-rated puffery.

It’s hard to imagine that it was only a year and a half ago that I discovered this true entrepreneurial phenom in the heart of a city I call home.

I’m even more proud that I had the chance to sit down with one of the company’s founders, Daehee Park, and interview him in a startup guy to startup guy fashion.

Here is some of what transpired out of that conversation a little over a year ago.

He shared with me what he discovered about the industry itself:

Most of what you see with the mattress industry is marketing and sales driven. You’ll hear a lot about what goes into it, what it’s infused with (such as green tea or lavender), all the different layers, etc. Salesmen try to sell you “layers” as a feature.

On top of that, there are essentially three tiers to this industry. The manufacturer, the distributor, and the retailer. Most people only deal with the retailer and by that point, you’re paying for a bunch of middlemen and inefficiencies in the distribution chain when you walk into a store.

So, with that being said, we created a hypothesis:

“What if we create a high quality mattress made here in the USA, and sell it for a fair price and strip away all the gimmicks.

Then we went to proof of concept to validate over the next several months.

As well as their customer-centric approach to everything:

We want to constantly be able to improve on the product we’ve made so we listen to our customers and immediately apply it to our mattress. It’s a constant state of iterations to be the best possible product.

I think the fact that everything we do starts with the end user, the customer, gives us huge competitive advantages. Many manufacturers never deal with the customer because they are in business with the retailer.

Instead, we grow with our customers. This allows us to make changes very quickly for future iterations. We’re very flexible and nimble that way.

And their constant reinvesting strategies:

From a “growth” perspective: We’re bootstrapped. That’s a big factor. We fund our own growth through our profits and we’re growing quickly. Compare this to a venture-backed startup that typically spends ahead before the gains.

Our approach forces us to be lean and be a product-focused company first, rather than be marketing focused first. Hence, we needed to have a high enough satisfaction rating so they would organically spread it to their networks and friends instead of being forced through marketing channels.

On having an engaged workforce and environment:

From a company standpoint, we wanted to take all the lessons we learned working with companies in the past to create a culture and a set of processes in the best way we can. It’s about being really open to new ideas and experiments with organizational design—Zappos is a great example.

And because we’re never married to something, if we find something better to use, we’ll use it.

It’s about being very flexible and nimble, as well as making everyone’s work easier and much more efficient.

When you create transparently, you know what everyone’s working on. I’ve discovered this allows us to constantly make changes without all the corporate red tape.

Daehee also shared with me three key points for entrepreneurship and taking the leap of faith from corporate to going the entrepreneurial route:

  1. Validating your idea
  2. Going to market fast
  3. Listening to your customers.

It’s like this.

A quick overview: Set up a landing page with your hypothesis to supply a point of feedback with your potential customer. You want to see if they’ll either give you an email or their money. Give them the option to do something.

As long as there’s an action for them to take, you’ll be able to validate and listen to their wants/problems.

From there, you can start driving traffic to your initiative. Do what you can to find traction fast––maybe some paid search, community forums, etc.

Doing this will help you move the needle faster to make decisions on your next steps.

As for going to market, a lot of people are scared. They are afraid to make the leap. In order to take things to the next level, you really have to go all in and be fully invested emotionally. We quit our day jobs to be fully committed and we were going to find a way to make this work.

And let’s not forget their rapid growth:

We’re a startup, so we have to deal with all the things that come with a startup. We hit $1 million in the first full year in 2013, and $1 million in just a month by December 2014. Those kinds of sales mean we’re growing fast, but we have to be careful in managing our growth.

Fast forward to today and you’ll see that Daehee Park and his partner, JT Marino, have built a highly lucrative startup that has completely disrupted an age old industry and is predicted to reach between $125 million and $225 million this year, as noted by Forbes earlier this year.

Am I surprised? No.
When I first interviewed Daehee for my startup Hustle & Deal Flow, I knew the kind of trajectory they were heading for. You could sense it by their dedication to their mission, their relentless focus on their end customer and their dedication to growth over ego.

Not to mention, Daehee has a love for Phoenix and he’s committed to adding to this city’s entrepreneurial spirit, which is rapidly becoming a hot bed of activity.

My prediction––Tuft & Needle will be a billion dollar company within the next two years. Not bad for two former software engineers who seriously wanted to disrupt the mattress industry.



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