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Earlier this year our CEO Ray Cao had a chance to interview Philip Krim, Co-Founder and CEO of Casper.

A few weeks ago, Casper recently announced a $75 Million investment from Target, which came as a result of a turned-down takeover offer valuing Casper at (reportedly) $1 Billion.

This week’s episode was released in partnership with CNBC and you can read the full episode summary here

Daniel: Today, on “Connections:”

Philip: We thought it would be best to raise a little bit of money before we launched Casper. And we were told no dozens, and dozens, and dozens of times. And so that can be something that really is very demoralizing and it certainly made us question our decision, it certainly made us question our conviction. But at the end of the day, especially when we weren’t sure if we were gonna be able to raise money, we said, you know, “This is an idea we all believe in, this is an idea that has to [00:00:30] exist whether or not we raise venture money.”

Daniel: My name is Daniel Rodic and I’m your host at “Connections” brought to you by Exact Media. We created this podcast as we realized that a lot of people we spend time with in our day-to-day work, brand managers, marketers. Those who are trying to rise quickly in their careers, could benefit from hearing the stories of the leaders they look up to in their industry.

In every episode, we cover the stories that you’ve never heard of. Where did they grow up? How did they get their first job? [00:01:00] What were their successes and failures in their career and how do they recover from them? My hope is that you will take away some interesting tidbits and tactics that will help you accelerate your careers. I don’t wanna spend too much time talking about us.

But so you have context on how we’re involved in the industry… At Exact Media, we work specifically with marketers to help them sample their products through the parcels of online retailers. For example, if you bought running shoes online, we might give you a sample of a healthy granola bar in that parcel. [00:01:30] If that interests you at all, visit us at www.exactmedia.io. Now, onto our guest.

Today’s guest is Philip Krim, Co-Founder and CEO of Casper Mattress. Philip got his entrepreneurial start building his first company out of his dorm room in college, which got him in the business of selling things online, including mattresses. Years later, while in a co-working space in New York, he got to know four other individuals who shared an interest in mattresses, [00:02:00] leading to them starting Casper together.

This interview covers many twists and turns of the Casper story, including how they went against common convention and raised money before actually launching the business. How they survived selling their year one projection, \$1.8 million worth of mattresses in just 60 days, how they got started with subway advertisements. How the name Casper actually came to be (hint: it’s not the ghost), and how they got celebrity investors like [00:02:30] Leonardo DiCaprio and Tobey Maguire to buy into their vision. Here is Exact Media’s CEO, Ray Cao, interviewing Philip Krim.

Ray: Philip, thank you so much for doing this. So maybe to get us started with things, can you take me back to the time right before Casper was born? How did it happen and what sparked the idea?

Philip: Sure. So I met my co-founders for Casper, [00:03:00] I met three of my four co-founders, so I’m one of five co-founders. We met in a co-working space here in New York City working on a couple of different startups. And randomly, we were assigned to sit next to each other and just became friends, and kind of compared notes, and started talking about just random topics. And one topic we kept coming back to was around sleep. And people were starting to track sleep through Fitbits, and eventually Apple watches, and people were also trying to be as [00:03:30] productive as possible.

Like this was a kind of startup work space, and yet no one was really prioritizing getting a good night of sleep as part of the way to be as productive and creative as possible during the waking hours. And one of my co-founders, Neil, his dad’s a sleep doctor. And actually in my first company that I started when I was in school at the University of Texas, back in the early 2000s, I actually learned the mattress industry by selling different kinds of mattresses online [00:04:00] through different niche websites. And so, we just started talking about sleep and coming back to it.

And we then led to the idea that buying a mattress remains kind of the worst consumer experience in existence, and that didn’t seem right. We think worse than used cars. And we layered that into the context of we really admired what, you know, Warby Parker was doing, what Harry’s, and Dollar Shave Club were doing. And they were circumventing the traditional retail experience, taking to product, [00:04:30] excuse me, taking to market great products. And doing so in a really fun way that connected with customers. And so, we started looking at that business model for the mattress industry, and it made a lot of sense. We could circumvent the traditional retail experience, which is terrible. Filled with commission salespeople in a very confusing, daunting sales floor, and we could build our own product.

And one of my co-founders, Jeff, is a brilliant industrial designer, who had worked at IDEO for a decade and had worked in this category before as well. [00:05:00] And we can do it in a way that would connect with us as customers. And so, we’ve always tried to put the customer first and build an experience that we would want to enjoy as customers. And that’s what led to the idea of Casper, and this was kind of summer of 2013.

Ray: So we go back to that beginning. It sounded like you guys were doing your own thing and then got together just because you were in that shared space. Did you guys have to stop your own ideas [00:05:30] before starting this? What was that like, or did you just jump straight into building Casper?

Philip: No, we did. We had to make a conscious effort to say, you know, what we were working on wasn’t gonna go the way we wanted to. You know you always learn the trials and tribulations of any business as you’re in the thick of it. And we decided that we were gonna wind down what we were working on because it didn’t seem like it had the [00:06:00] legs that we had hoped, and decided to…

Ray: What were you trying to build at the time?

Philip: I was working on a company that sold leads to local businesses, specifically mobile leads. So for example, if a customer was looking for a tow truck in Houston, Texas, I would connect that search to a local, you know, tow truck operator and then sell them that lead. So kind of like a click-to-call program.

Ray: A little different from Casper. [00:06:30]

Philip: A little different from Casper, yeah. But it’s funny, my background, my entire career has been in online marketing and digital advertising. This was, again back in 2012-2013. I’d known that mobile was gonna be very powerful, especially for local transactions. And that certainly informed a lot of our thinking with Casper too. Mobile is a huge part of our strategy. It’s a product that traditionally people think about buying locally and we’ve tried to be really [00:07:00] innovative on how we connect with our customers. Both to make them aware about what we’re doing, but even throughout the purchase process. And that’s why, you know, today I think we really do have a best-in-class customer service and shopping experience. You know you can text us, you can call us. We just wanna make it as easy as possible. And this is in an industry that has been notoriously slow to adopt technology, and to change things, and champion innovation. [00:07:30]

Ray: Looking back, I mean it seems obvious that it was the right decision to just stop what you guys were doing back then and to build Casper. But was it difficult to make the decision at the time?

Philip: Yeah. So, it’s funny when you set out with a new idea, we thought it would be best to raise a little bit of money before we launched Casper. And we were told no dozens, and dozens, and dozens of times. And so [00:08:00] that can be something that really is very demoralizing. And it certainly made us question our decision, it certainly made us question our conviction. But at the end of the day, especially when we weren’t sure if we were gonna be able to raise money, we said, you know, “This is an idea we all believe in. This is an idea that has to exist whether or not we raise venture money, and we were committed to it.”

Fortunately, in the fundraising process, we did end up with an introduction to Ben Lerer, who saw what we wanted to build, and decided to back us. And so, we were able to raise the [00:08:30] seed round before we launched. But, you know, when you have a new idea, it’s an idea that generally doesn’t exist in the marketplace. And so you’ll hear noes from a lot of people that just don’t see the world the way you see it. And so, it certainly made us question our conviction around the idea.

Ray: Was it even harder given that this is a mattress company and not something that a traditional venture, sort of, capital firm would normally invest in? [00:09:00] Did most investors look at you guys and say, “What are you guys doing? Are you crazy?”

Philip: Oh, completely. I mean we heard, you know, every reaction out there. Like you know, “You’re gonna make selling mattresses cool? Like okay, yeah, good luck. You’re gonna go to market with just one mattress? That makes no sense. You’re gonna sell a mattress that everyone wants to lay on without having a retail presence? Okay, good luck. You know, you’re talking to technology investors, but you’re gonna sell mattresses? How does that make sense?”

I mean [00:09:30] there were a ton of different areas, you could certainly attack what we wanted to do and what we wanted to build. But I often think that the best ideas come when no one else or very few people see it the way that you see it. And that’s what creates the opportunity. And so, you know, with Casper, it certainly worked out so far.

Ray: What skew is it, that Ben saw that others didn’t see, and then why he placed the bet on you guys?

Philip: I think Ben had a [00:10:00] thesis on the industry needing change, before he met us. And I think when he heard what we wanted to do, it was a fresh take on an industry that was very much in need of rethinking and reinvention. And so, I think Ben was an early investor in Warby Parker and a lot of other great consumer businesses. And I think he saw some of the same characteristics.

You know, this is an industry that tightly controlled, you know, very much a power of a few, [00:10:30] and they’ve resisted a change that technology or the consumers should propagate. And I think he’s seen that thesis before and, you know, we certainly have loved working with Ben. He’s been super helpful since the very beginning and we were lucky we were introduced to him.

Ray: So, since that initial seed round, which now it seems like forever, I mean you guys have brought on some incredible investors [00:11:00] and also some unusual ones, right? That certainly do make certain people look in awe. Like Leonardo DiCaprio and Tobey Maguire, just with those two names, like why them? And I guess the other obvious question is like how in the world did you get these guys as investors?

Philip: Yeah, it’s been, you know, a funny kind of syndicate of investors. I think the universal theme is that everyone realizes buying a mattress is [00:11:30] terrible, and that sleep is something that really is important. Especially of the idea that sleep is really becoming a third pillar of wellness and wellbeing. And I think that’s something that resonates with investors whether they’re celebrities, or athletes, or institutional investors. Everyone realizes they perform better when they get a good night of sleep, and that’s kind of the essence of the Casper brand.

And all of the relationships with almost all of our investors came very organically just from people [00:12:00] that were involved with the company early. And, you know, made introductions as they helped kind of spread the word about Casper. And so we very much enjoyed working with them.

I think actors and celebrities really do get kind of building a brand because they think they have to do that personally. And so, you know, I always enjoyed kind of talking shop about how we’re trying to build a brand, because we try to stand out in a crowd. We try to build awareness and we want people to know what we’re doing. And I think, a lot of times, actors and athletes think about that a lot too. [00:12:30] And so it’s something where they’re very helpful with our business and how we wanna build it, and we enjoy working with all of them.

Ray: What was it like getting them as investors? I mean, did they look at your projections and your business plan, and ask you a bunch of questions? Or was it just, “Hey, sign me up?”

Philip: No, they go through the presentation, they ask questions, we talk about the future, we talk about what we’ve built. They’re very thoughtful, very, I think, [00:13:00] discerning, and they get our business. They understand our vision and I think with all of our investors, I mean the most important thing is, are we aligned in what we wanna build and how we see the future? And so if we do that, great, we move forward and if not, no worries.

Ray: Mm-hmm. Did you have to deal with, you know, Leo and Tobey’s money manager or did you actually have to convince them directly and walked them through it directly?

Philip: With some folks, it’s [00:13:30] money managers. With some folks, it’s a combination. And then with some folks, it’s just direct and they’re doing it personally because they like it and wanna be helpful.

Ray: Were you nervous going into those given they weren’t the traditional investors? Because they weren’t just fund [inaudible 00:13:48].

Philip: I think like with my first few conversations… Oh, sorry, I was just saying, with my first few conversations, you know, you’re potentially a little star struck or you just don’t know how the [00:14:00] conversation is gonna go. But after having a few of the conversations, you realize that these guys are all incredibly smart. They think a lot about things the same way as traditional investors do, and it’s just a good conversation. And that’s kinda how we approach everyone now.

So now it’s not an issue but in the beginning, I mean fundraising is something that you just get better with as you practice. And the older your company gets, the more money you raise, the more conversations with investors you have. [00:14:30] Just the more how you learn how other people view the world.

And I think it is a helpful process for thinking about our business and what we wanna build in the future. But, you know for better or for worse now, we’ve had lots of these conversations with celebrities and otherwise. You learn more and more about kind of the different ways that people might look at your business.

Ray: Hmm. I’m gonna go in a slightly different path and back to the early days. I mean, you had five total co-founders. You know, was it obvious [00:15:00] as to how you guys were gonna divide and conquer in the beginning? And how have your roles evolved over time, now that Casper has grown up quite a bit?

Philip: Yeah, it’s been great. We’ve been really lucky. Casper couldn’t move as quickly as it did. Casper couldn’t grow as quickly as it did, if we didn’t have five co-founders who were fully committed to the business and if it didn’t allow us to divide and conquer the business. So in the beginning, we kind of divided it between… [00:15:30] You know, I took the CEO role, one person led on tech, one on product, one on creative, and one on operations. You know, since then, all the founders are very active in the business and continue to contribute in amazing ways.

But we’ve been able to build up the senior leadership team and bring in folks that have a great deal of experience around some of these different disciplines and functions. And it’s worked out beautifully. It’s one of the areas where I think I’m kind of the luckiest. It’s just that I have incredibly smart co-founders. [00:16:00] They’re super engaged. We all love the mission that Casper is on and appreciate kind of what we’re trying to build and it’s worked out really well.

Ray: Given that you started at the same time, how did you guys come to the decision that Philip was gonna be the CEO? Was it because you raised your hand first, or what made that the obvious decision in the beginning?

Philip: No, it goes to background. So I’ve always run my own company since I was in school, [00:16:30] so I had the most experienced there. And we really, the five of us came together because, I think the areas of the business that we liked, which matched kind of the areas where we were experienced. And it was a very natural kind of way to divide and conquer things.

Ray: I mean do you guys see yourselves as an overnight success?

Philip: You know, it’s not a way that I would ever describe Casper. We, certainly, are very blessed that as soon as [00:17:00] we launched the business, we had customers purchase from us. I mean, that was to this day something that did surprise all of us. That someone would wake up one day, read about a company launching that sold mattresses, and, you know, dozens and dozens of people decided to buy from us. And that was amazing and mind-blowing. It quickly became very scary because then we realized, uh-oh, we have dozens and dozens of customers, now what? Since we didn’t have that much product on hand. And we quickly had to start scrambling to make sure that we [00:17:30] delivered a customer experience that we were promising.

But, you know, from there, it was just a lot of work. And it was work we loved, and enjoyed, and we started talking to customers and the expectations just got higher and higher. So it doesn’t ever seem like we were able to step back and be like, “Oh, that was super successful, now let’s take a break.” It just means that we’ve always had more work ahead of us. And to this day, we continue to think that we’re very early in our journey. We’ve only scratched [00:18:00] the tip of the iceberg and there’s a lot more work to do. So we don’t ever think about it as, “Oh, that was an overnight success.” And we really wanna continue to build this to be an iconic global brand.

Ray: How much of that, you know, previous company that you had started, when you were involved in the mattress industry already, do you think helped in building Casper?

Philip: Oh, I think it was tremendously important and certainly informative. And I think [00:18:30] particularly on the front where, you know, I’d sold different kinds of mattresses, I’d sold memory foam mattresses. So I heard what customers said about those all day every day. I sold airbeds, I sold spring beds. So I knew from a customer standpoint what they liked and didn’t like about all of the options that were out there.

And that’s what led to a conversation with Jeff, my co-founder, who’s head of product, Jeff had built a lot of these mattresses and we started comparing notes. And I think we had ideas on what we could do. [00:19:00]

Jeff started going down the kind of user-centric design philosophy that he has, that IDEO has. And it led to the Casper mattress which we really do believe is one of the most comfortable mattresses out there of all time. We think that’s what’s led the Casper mattress to be the most reviewed mattress of all time and our customers love it, and it’s changed people’s lives. And I think a lot of that was informed just by my knowledge of the industry. And then I certainly think that, you know, I saw the consolidation that happened throughout the [00:19:30] 2000s. I saw Tempur-Pedic go public, saw them merge with Sealy. And so the industry dynamic is very unique, the mattress industry is a very unique category. And I think navigating within that industry is unlike a lot of other industries. And so hopefully, we were benefited from just our collective knowledge of the space.

Ray: So Jeff was building mattresses before, already? Like this was part of his background?

Philip: So, [00:20:00] Jeff was a senior industrial designer at IDEO for over a decade. And while there, he worked on a number of different clients and products. And randomly, he had experience in the mattress space.

Ray: Do you ever look back and think that, is this a…I don’t know. It just seems like a great fortune that you guys were building different companies at the time. Somehow, you were in the same space, and then all seemed to have had some expertise in the mattress industry? I don’t know, it was like all the ducks were lined at the same time. [00:20:30]

Philip: Yeah, no, incredibly serendipitous. Stars were certainly aligned. I mean Jeff was truly like a brilliant industrial designer, engineer, and thinker. And to happen to know Jeff by reputation and he happened to work in the industry. And he happened to align with timing of his career to kind of work with us, who had ideas in this business… I mean, there’s just so many random, you know, happenstance moments in the founding of the [00:21:00] company. And, you know, I feel very lucky about all of it.

Ray: You talked about when you first launched, you guys started getting dozens and dozens of orders. It sounded like you had less inventory than you were projecting. How many mattresses did you guys think you were going to sell? And what was success for you guys at the time, pre-launch?

Philip: I think our first-year projections, so 12 month projections, were something like \$1.8 million-ish? [00:21:30] And I think we ended up doing that in less than 60 days.

Ray: Okay. During those 60 days, what was going on inside of Casper? I mean, I imagine it was chaos, to just try to figure out like, “Oh my, god, what am I gonna do about all of these orders?” Right?

Philip: Yeah, it was definitely chaos. It was definitely all hands on deck. All founders and the [00:22:00] handful of employees that we had, at the time, were manning live chats and talking to customers in real time. My Co-Founder Neil actually had a brilliant idea where if your order was delayed, we would send you, as a gift from Casper, an air mattress that we would buy on Amazon to hold you over. And not that it was a supplement or replacement for a Casper mattress at all but, you know hopefully, it just showed that we felt bad that we were delayed.

We tried to be very proactive with how we communicated with our customers. [00:22:30] And I think that was one way that we really showed customers that we cared and were apologetic for the delays. But it was super painful. I mean we had hundreds and eventually thousands of customers that were very delayed on getting their product. And we tried to do constant updates. But we were working with manufacturing partners that I mean just didn’t have that good of a grasp on the volume they needed to produce, and partly that was our fault. We just didn’t forecast [00:23:00] the demand for our products well.

And so, it was certainly a stressful time for Casper and we knew we had to live up to our customer expectations. We knew referral was a huge part of our business. That’s how all of these people were hearing about us. And we didn’t want to kind of destroy the trust that we were trying to build with customers. So very stressful. It took us a long time to work through it. You know that’s part of the fun part of selling physical [00:23:30] products and having to deal physical manufacturing. But at the end of the day, you know, the customers appreciated the product. They loved the product and they started telling their friends in groves and that’s why Casper’s continued to grow so quickly.

Ray: When you first started, was it difficult to get manufacturing partners to sign up for this, given that you were probably gonna do very low volumes?

Philip: Definitely. A lot told us no. A lot didn’t think that our idea had any legs. You know, we were [00:24:00] lucky to meet one who agreed to do it. You know, sometimes, it felt like pulling teeth to get them to do what we wanted. But we found one partner who was entrepreneurial and agreed to give us some capacity but it took a lot of conversations. It took a lot of knocking on doors to find someone who would support us with the products that we wanted to build.

Ray: Did you guys have to structure something special in the first yield to make it work? Or was it just the traditional way that the manufacturer would have done work with anyone? [00:24:30]

Philip: I think it was traditional. Some of the non-traditional parts were, we wanted the manufacturer to do fulfillment. And so, we asked the manufacturer to ship directly to our customers. They were not used to doing that. That’s obviously not how the industry worked. Also, we also had a very specific design that we wanted to take to market. So most people, when they go to a contract manufacturer in our space, say, you know, “Give me something off the shelf and I’ll put my label on it.” That’s very easy to do. That’s what a lot of people [00:25:00] that have followed us into this space have done.

We had a very specific build that we wanted to do and so it took a little bit more work and a little bit more time to get the manufacturer the component parts they needed. And to have them be able to create what we wanted to create. But at the end of the day, the relationship worked kind of in a traditional way, I think.

Ray: Well, what did the manufacturer say after the…or during the first 60 days, after all the heightened orders? [00:25:30]

Philip: I think they were amazed. I mean everyone was amazed. And you know, fortunately, they saw the volume and they tried to step up too to support us. And we were, you know, working very closely with them on their floor trying to help every way we could. It takes time when you need inventory and you need input materials. And, you know it’s not something like software where you can just push code and update things. So they were [00:26:00] very supportive, very delighted that it was working well. And we very quickly got the attention of a lot of folks in the industry.

Ray: I imagine the manufacturers who said no kind of knocked on your doors again to say, “We’ll work with you now?”

Philip: I think so. I think pretty much any manufacturer in the space now is trying to work with us. But we have very high standards for , you know, the quality of the materials that we wanna produce in the manufacturing standard. So [00:26:30] we’re not always the easiest customer for manufacturers but we’re okay with that.

Ray: I wanna jump to that early launch period, that first launch. I mean you guys have always been pretty clever with your marketing. But what do you think you guys did that made that launch successful? It couldn’t have just possibly been, launch a website and suddenly, you get dozens and dozens of orders. What did you guys do, that you think now looking back was really the [00:27:00] right decision, the right idea, that kicked things off?

Philip: So, I think we were really focused on telling our story in a unique way. We were lucky that a lot of press outlets covered the story. And I think there was just enough different areas of the story that really got people’s attention. We invested heavily into the engineering of the product. We changed the way that the product is delivered. [00:27:30] We were offering on-demand delivery in New York City on, you know, a cargo bike.

There were just so many different things about the story. And at the end of the day, it was all done around the idea that we wanted to completely elevate the customer experience in this category. And we had the backdrop of the mattress industry being a consumer experience that people hated and so, I think people were willing to give us a shot.

They saw that it was an incredible value for the product quality that you’re getting. [00:28:00] Mainly, because we were able to take out the middle men that are associated with retail stores. We were able to pass that value onto customers, and combine it with an experience that was really unparalleled, not even within our industry. I think Casper has always really stood out among any of the kind of commerce or consumer categories as something that people loved, something that people trusted, and something that really resonated with people.

And so, I think we were lucky that the press covered us and that they told our story [00:28:30] in a really compelling way. I think the customers saw that and bought from us. And then I think they started telling their friends and that’s what created the cycle that has been so great.

Ray: But did you guys have a lot of press contacts at the time? Or how did you actually get their…you know, did you email them, cold email them? Like what was it that you guys had to do?

Philip: No, we didn’t. We worked with an agency to help us with that. We had no press contacts at all. [00:29:00] But we knew that that could be a really powerful way to tell your story. And I think launch moments, for us even to this day, are a big deal and we try to highlight it. Most recently, we had an amazing launch for our dog mattress and we just always try to have fun with the launches, and work with the press to tell our story. So we worked with a great agency there and the press strategy continues to be something that is really important to us.

Ray: And I think that [00:29:30] Warby also did something similar, which many people thought they were crazy. To, you know, have an agency to help them with press when they pretty much didn’t even start the business. Were you following a similar playbook or…? I mean I can imagine that they were also wondering who are you guys, you know, why should we be doing this for you guys. Was it sort of an obvious decision that., “Hey, we’ve gotta partner up with an agency to begin with,” given that you were limited in money and resources? [00:30:00]

Philip: Yeah. You know, I don’t know how obvious the decision was. I think it was something that we thought was an important part of our playbook. I think, you know, there are a few things we thought were important, some were and some were not. But press turned out to be the right move and we’re very happy we made that investment. It’s a significant investment when you’re young and have only raised a [inaudible 00:30:25] to hire an agency. But we definitely thought it was [00:30:30] something that could be an important piece of the company trajectory.

An example of something that we thought could be that probably didn’t was we invested pretty heavily into a launch video that told our story and to help kind of frame the brand. And I think that was an area where it probably didn’t really move the needle for the company, and it wasn’t an important piece of the component. And that’s why I think for every company that launches, one, I always recommend that they take the launch as a really unique [00:31:00] moment in time. And something that you should be really thoughtful about.

Some things work for some companies. Obviously, Dollar Shave did incredible with the launch video that catapulted them into remarkable popularity. But most of the videos don’t always work because sometimes, you just have to roll the dice on a few different ideas. Some hit, some won’t. And, you know, hopefully from there though, it puts you into a different level of visibility for the company and you can build on that.

Ray: Hmm. [00:31:30] You know, on your marketing, you guys were named…you’re one of those innovative companies. You were named by “Time Magazine” as one of the best inventions in 2015 and all that but you do a lot of traditional advertising. Right? I don’t know many people who have never seen your ads on the subway, like it’s everywhere, right? Why have you guys done that? And how is that measurable and how do you ensure that that’s actually an effective channel to market through?

Philip: Yeah. You know, the subway was another one of those early bets where [00:32:00] we all rode the subway, we all stared at the subway ads, they could be a lot better. We also liked that, you know, the subway ads are a lot of times kind of the first thing you really see in the morning after you wake up. And a lot of times, it’s almost the last thing you see before going to bed. And we just thought there was a really unique opportunity to have fun with the creatives, to hopefully put a smile on people’s faces, and we just rolled the dice with it.

We didn’t know if it would work but fortunately, you know, we do [00:32:30] track it closely. We put promo codes in the creative and we think it’s a great way for us to build visibility, and so we’re really happy with it. We continue to do a lot with the subway in that channel, in that medium, and refresh creative. And for us, with everything we do, we really say, you know, it has to work from a business standpoint but it has to be on brand. It has to make people smile and appreciate how we think about things. And that’s always our goal and we continue to think about the subway [00:33:00] as that opportunity.

Ray: I mean when you see the advertisements now, they take up pretty much all of the trains and it’s all throughout the stations. When you did your first campaign, was it just one billboard or one section of the train?

Philip: I think our first buy was a remnant deal that they had for us. It was something that was, you know, a one-off. It was kind of fairly last minute, which the creative team hated, [00:33:30] but it was a good discount and we just wanted to roll the dice. And we were trying to be as crafty as possible with all of our media decisions and that one fit the bill.

Ray: Wow. Yeah, I imagine that now with all the…you know, after becoming a media darling, and with all of the ads being out in the public. That’s created a bit of…sort of, you know, an interest from others and have now created a lot more competition. [00:34:00] You know, how many clones and competitors are there now for Casper?

Philip: Unfortunately, too many to count. I think we kinda jokingly said, I think we might be the most copied startup or business that I’ve certainly ever seen. So it’s almost laughable at this point. But the good news is, I think we’ve been very well stress-past on what competition means for us. It hasn’t slowed us down. We haven’t seen any of them do anything that’s really inventive, or innovative, or creative [00:34:30]. And so, we feel good that we can continue to chart our own course. That, you know, we’re running our own race and as long as we keep elevating the customer experience by taking great products to market, in really unique ways, that we’ll continue to be successful. But it’s kind of amazing.

Ray: I mean how do you guys deal with that on a day-to-day basis? Do you just have someone who keeps an eye on it? [00:35:00] Do you ignore it? I mean how do you guys treat competition now?

Philip: Yeah, I would honestly say like on a day-to-day basis, we don’t deal that much with it. We’re certainly aware of the competition and we certainly keep a close eye on it, we’ll check in on it but day-to-day, it’s much more about internal facing. How do we improve service of offerings? How do we improve the products that we have in the market? What can we do to make our own game better? So we’re aware of the competition. [00:35:30] You know, at this point, there’s been so many that pop up, and go away, and fade away, and never do anything that we don’t talk about new ones.

There’s a handful of guys that we think are decent competitors and, you know, we, certainly, have thoughts on how we’ll continue to compete aggressively. But it’s not something where every day, we’re talking about competition. I think our future is much more controlled if we focus on our own destiny and pushing ourselves to do better.

Ray: Hmm. [00:36:00] I mean I know you recently have gone international as well. You’re in Canada and I think you’re in Germany now as well, right?

Philip: We are in Germany, Switzerland, Austria, and the U.K.

Ray: Oh, wow. What was it like? I mean how did you guys make the decision to go international, and were there clones that were already in those markets at the time? Or were you the first to enter those markets?

Philip: We always [00:36:30] had the aspiration to build a global brand. You know, one of the mantras that we talked about is, “What does the Nike of sleep look like?” And so, we always wanted to have a global footprint. I think we did accelerate the focus that we’ve had into other markets because we saw other folks doing what we were doing in other markets. And so, that was certainly one factor that contributed to the ultimate decision to go into Europe. But, you know, we’ve always had very big ambitions [00:37:00] for Casper and we want to build the next great global brands out there. And so, having a global footprint is, obviously, required for that and something we’re excited to do and invest in.

Ray: What was it like to get it set up? Did you have to find a local general manager, did you go out there and start it from scratch? What approach did you take to build out your international strategy?

Philip: Yeah. So the first thing we said is, “If we’re gonna do it, [00:37:30] we need a great global lead.” So we ran a search for global managing director and we ended up meeting Constantine and that step one. So Constantine’s on the ground in Berlin, he is an incredible operator. We got him out of Home24. And he’s scaled tech companies before and is an just incredibly sharp, great partner, and so that was kind of man on the ground. And we built up a team around him and then watched.

Ray: [00:38:00] Is Berlin sort of headquarters for all of Europe or do you guys have local offices for each country?

Philip: It is.

Ray: Okay.

Philip: No. Eventually, we will but for right now, our only European office is in Berlin.

Ray: Got it, got it, got it. I’m gonna jump into a bit more about you and your own personal life. I imagine, you know, Casper’s growth has resulted in you being a little busier. You’ve got more people to manage now and [00:38:30] a few more things to do. How has that impacted you personally? I mean, in your relationships, with family, and all that? How have you had to evolve to support the growth of the business, personally?

Philip: Yeah, it’s been an amazing journey. You know, I think part of what I’ve learned with Casper is just that every week, every month is kind of different than the weeks and months before. And you have to [00:39:00] kind of force yourself to reinvent how you think about your priorities and how you spend your time, and that continues to hold true.

With Casper and with my co-founders, from the very beginning we said, you know, were gonna prioritize kind of work-life balance. And, you know, I think it’s something where we all have a good grasp of making sure that we have our responsibilities and they get done. But knowing that we have lives outside of Casper too has always been important to us. [00:39:30]

I got married after starting Casper, but that’s been amazing. Fortunately, I have a very understanding wife who is very flexible when it comes to, kind of, work commitments and allowing me to make sure that Casper is well-served. And I think all of the founders have thought about things that way. We’ve all had to grow very quickly in our professional maturities. We’ve all taken on a lot of responsibilities that are very different than anything we’ve done before. And I think we’ve all been able to do that [00:40:00] in balancing other parts of life that can make us happy as well.

Ray: Do you have rituals and rules that you try to follow, to respect the personal time?

Philip: I don’t. Although, I guess, you know, one anecdote, and maybe this is a bad thing, but that comes to mind, is I’m someone that gets much more stressed if I try to disconnect from work. And so, even on my honeymoon, you know, again flexible, patient, wonderful wife, agreed that [00:40:30] I could stay connected to the office. You know things are always moving a million miles an hour and so I hate to be disconnected for any amount of time. But part of the deal with the honeymoon, we agreed to go out of the country for a little bit as long as I could stay connected to the business, and so that’s why I continue to do things. You know, I rarely ever kind of step away or aren’t very connected to everything. But I think that that gives me more peace of mind than if I tried to say [00:41:00] no email time between certain days or hours.

Ray: Are you on all seven days of the week?

Philip: Yeah, we’re pretty 24/7 just when it comes to things. I mean Casper’s not a business that requires 24/7 always. But we just have so much going on across the business that, you know, it’s something that’s always on my mind and I’m always connected to whatever’s going on.

Ray: Hmm. [00:41:30] You guys are a pretty young team. I mean the co-founders are all fairly young. How did you guys figure out this whole building company stuff, and how to run a business? Were there people that helped you along the way or did you guys get coaches? Like what was that development process like?

Philip: I think a lot of it is fake it until you make it. No. Honestly, it’s you know, you’re learning on the job, that there’s… [00:42:00] I think one of the amazing things about building your own company is there’s no playbook, there’s no recipe for success. Every company is built differently. Every company has their own set of priorities and cultural differences and so, you get to chart your own course and you get to build it the way you wanna build it. And so that’s amazing but that can also be very scary and daunting because there is no playbook. There’s nothing to fall back on, on how you should do things.

And so, you know, a lot of things are… [00:42:30] It’s very helpful to have great partners that think about things. We’ve always embraced the kind of very debate-focused culture where there’s no pride of authorship and, you know, the best idea wins. We try to be very thoughtful with how we build the company, and teams, and our hires. And we always try to bring in folks who can elevate the conversation in the level of experience and influence that we have, and, you know, so far, it’s worked out well. We try to be very self-aware and understanding [00:43:00] what we know and what we don’t know. We try to find people that know what we don’t know and we try to form, you know, thoughtful opinions on the stuff that we do have an opinion on.

Ray: How have you managed to preserve the culture with new hires? Do you guys have a special on-boarding process? To ensure that they live up to the culture that you guys have built from the beginning?

Philip: You know, I think culture is super, super important. It’s always been the number one filter for [00:43:30] any new hires to make sure that they’re a good cultural fit to Casper and to… You know, that they’re aligned with the values that we prioritize and think are important. I would just say, you know, the company feels maintaining a culture is just something that requires effort or requires prioritization. And it’s something where we’ve always really emphasized, maintaining the culture and making sure that we’re investing into programs [00:44:00] and initiatives that help cement the culture. And it’s compounding the difficulty when you have folks in multiple offices, you know, working on different things. But it’s something you have to be committed to because it makes such a big difference to the long-term success for the company.

Ray: What are some of the things that you guys have done well to bridge the different offices and to make it feel more cohesive?

Philip: We try to all get together [00:44:30] a few times a year. So I think face time is important. So we try to make sure that we can get everyone together for some all-hands meetings throughout the year. We definitely do a lot of video chatting and try to be very collaborative as well. The founders travel a lot to make sure we’re all spending time in different offices as well as other folks on the senior leadership team. But, unfortunately, there’s no short cuts there. I think it’s just something where you need face time. It’s gonna [00:45:00] take commitment from everyone to travel and if you do that though, you certainly can bridge the gap that distance puts between you.

Ray: It’s now changed cause it’s no longer the five of you, but how do you as co-founders still stay in sync? Do you guys do anything to ensure that there’s a consistent rhythm to stay in sync?

Philip: You know, we’re also very good friends, and go to [00:45:30] dinners, and hang out, and hang out on the weekends, things like that. So, you know, I don’t know that there’s anything kind of secret sauce there. But it’s worked out great. I love my co-founders. As I mentioned, they’re all incredibly smart and engaged. And, you know, I count myself extremely lucky to have found the group that I work with. So we’ve just naturally stayed very close, which has been great.

Ray: Has it ever been challenging, given that you guys were good friends [00:46:00] to start with, to have confrontation and conflict? I mean it’s not always easy to tell your friends that they’re doing something wrong or they need to get better?

Philip: Yeah, I mean there’s certainly been our share of conflict, and heated arguments, and debates but I think it’s been amazing. It’s been a very ego-less company, and environment, and founding dynamic. And so nothing that went too far or nothing [00:46:30] that really became scary.

I mean I think the founders have always done a good job of making sure that the company’s best interests are what we put first, above any of our personal interests. And, you know, it’s also a good dynamic. Sometimes, with five, you can make sure that everyone is staying balanced. And you have a pretty differentiated perspective on things just by talking to a few different folks and so it’s worked out remarkably well. [00:47:00] There’s never been an issue.

Ray: So, everything from the outside looks like a tremendous success. But have you hit any turbulence so far? Has it just been pretty much a smooth ride all throughout? Have you screwed up at all?

Philip: Well, no, I appreciate that. It’s funny like from the outside looking in, I’m happy that that’s the way it looks. [00:47:30] From the inside, you know, there’s always things going wrong. And there’s always fires to put out and things to work on, for sure. Whether it’s hires, you know, that didn’t work out, whether it’s inventory issues that don’t have immediate resolutions, whether… You know there’s just any number of things on any given day that pop up that, you know, are not going right, and are not going the way that things were planned.

I think embracing that [00:48:00] chaos or dynamic is critical if you wanna be a startup founder. And I think we try to stay very even-tempered with the ups and downs of the business. But I guess the goal is to make sure that externally everything looks like it’s great because we want our customers to have an incredible experience. So I appreciate the kind words there.

Ray: But was there ever a moment where things just got so intense that you guys looked at it and said, “Okay, if we don’t fix this, [00:48:30] we’re gonna be done as a company?” Was there ever that moment?

Philip: You know, I’m sure there were freak-outs in the beginning and that’s one of the things with younger companies. A lot more of the things that are on fire are kind of existential threats, or at least feel like existential threats.

Some of the founders are probably a bit more reactive than others. But at the end of the day, it was always [00:49:00] a team mentality, like okay we have this problem, let’s figure out how to solve it. I think that’s just the mentality we take with everything that we approach. And if someone would raise a problem, it was never like, “Uh-oh, we’re screwed, we’re in trouble.” It was always like, “Okay, what do we need to do to fix it? Let’s brainstorm and think outside the box. Who can we call, what do we need to do?” And everyone chip in to make sure that we can get the problem fixed.

And so that’s always how we approach things, even to this day. And if [00:49:30] someone’s working on a problem with Casper, you always hear someone say like, “Let me know how I could help.” It’s always been that mentality of like, “Let’s pitch in to get the solution, get the problem solved and then let’s move to the next one.” And less like, “Okay, we’re done, I give up.”

Ray: If I were to talk to your employees or your other co-founders, how would they describe your style, your management style? What do you think they’d say?

Philip: Well, I don’t know, [00:50:00] you’d have to ask them. You know there are things that I would hope they would say. Just about, you know, being a thoughtful leader and hopefully, having a good vision for where the company needs to go, and what we need to do to get there. But I’m not sure exactly how they would articulate it.

Ray: Would you say that you’re more hands-on or that it’s, “Hey, you know, person X, [00:50:30] go run with it?”

Philip: I think it’s a balance. I try to be hands-on when I can be helpful and, you know, have a point of view or experience that can be relevant. But I also try to be hands-off when I have someone working on something that is a pro and knows this stuff cold, and I would only be getting in the way. Hopefully, it’s a little balance of both throughout the organization. And there’s, obviously, parts of the business where [00:51:00] I feel like I have a stronger point of view and are happy to share that then. But there are other parts of the business where we hired incredible folks who don’t need a lot of touch and, you know, we let them run with it.

Ray: I imagine you can’t do everything anymore. Where would you say is the, a few areas that you spend the most time now, for the business?

Philip: As we’ve gotten bigger, I spend more of my time externally than I [00:51:30] used to. So some of that is with investors. Some of that is with press, some of that is with hiring or hiring initiatives. So I spend a little bit more time externally than I used to. But still very focused internally on a lot of the areas that I’ve been very involved with since the beginning. Like marketing, and product, and, you know, other things that are just critical for Casper’s success.

Ray: [00:52:00] I’ve got one final question. So you’ve become incredibly successful but I know you’re constantly thinking about the business and your work. What scares you most these days, and what eats up most of your…you know, takes up most of your mind-share today?

Philip: You know, I think we’re at a stage now where you have to think more long term than we did in the beginning. You have to think 3, 5, 10 years out [00:52:30] on what you wanna build, because you have to allow, you have to lay the foundation to accomplish that starting today. And so, it means that we just have to spend more time thinking about, what does the future of Casper look like and what are the right priorities?

So given that there’s so many different things that we wanna work on, prioritization is a huge area where we have to get it right. And we have to make sure that we place bets that are [00:53:00] the highest and best use of the company’s resources and focus. And then once we place those bets and once we decide on a road map, we have to make sure that we’re executing effectively on that. And also be aware that things change and we might have to change the road map and we’ll make those decisions.

And again, none of this is easy cause there’s not kind of a road map on how to build Casper. So, you know, we try to be thoughtful with our approach there. But that’s where we spend [00:53:30] a lot of time now or it’s just thinking really long-term about the business. Trying to set prioritizations that align with that long-term thinking and then making sure we’re executing those priorities as quickly and as effectively as possible.

Ray: What do you want Casper to be ultimately, you know 5, 10, 15 years from now?

Philip: We want Casper to be the global brand that stands for a better night of sleep. And so we want people all over the world to have Casper be the top of mind [00:54:00] brands whenever they think about getting a great night of sleep. And we think that can span tons of different products, tons of different categories, tons of different geographies, tons of different life moments in your life stage. So we have a lot of work to do but that’s what we’re hoping to build.

Ray: I actually have one quick, quick final question, which is, why’d you call it Casper?

Philip: You know it’s funny, we kind of set ourselves an arbitrary deadline [00:54:30] of when we needed to come up with a name. We were coming up with all different options and at the end of the day, we kept coming back to Casper. Because one of my co-founders Luke, his roommate at the time was named Kasper. He’s actually Kasper with a K, and he was a 6’6” German guy who was renting a bedroom from Luke and sleeping on a twin mattress. And so, he did not fit on the mattress at all and we kind of all had a good laugh about that. And we just thought that was what we had to go with. And so that’s what we ended up putting down.

Ray: So it’s not [00:55:00] related to the friendly ghost?

Philip: No. It’s nothing to do with that.

Ray: Okay, awesome. Philip, I know you’re very busy so thank you so much for doing this interview.

Philip: No, my pleasure. Thank you for having me.

Daniel: Did you enjoy that interview? If so, it would mean a lot to us if you visited www.exactmedia.io/podcast and subscribe, and we will send the next interview [00:55:30] straight to your inbox. Have questions, feedback, or an idea for another guest? Email us at podcast@exactmedia.io. Thanks so much for listening.