We don’t appear to hear as much about lean new businesses nowadays. The primary concentration in the startup network is by all accounts about raising colossal aggregates of capital and hustling to an exit. That is energizing, and can make a great deal of significant worth. Martin Rawls-Meehan has taken an alternate course to producing $100 million in income a year. He has demonstrated that building a productive organization can in any case lead to turning into a sizable venture. One which can give you much more power over your startup and its capacity to experience your vision.
It was an extraordinary joy to talk with Martin Rawls-Meehan on an ongoing scene of the DealMakers web recording. In our restrictive discussion he uncovered his very own portion startup bootstrapping hacks, obstacles you can confront, and when it may be smarter to take that VC cash, or not (listen to the full episode here).
Performance Hacking with Sleep Technology
Together with his co-founder Tony, Martin Rawls-Meehan’s successful startup Reverie is all about sleep technology. We now know that sleep is far more important than we used to give it credit for. Martin says that “sleep is more important to your overall health and well being, that’s both physical and mental than nutrition or exercise.”
The incredibly broad demographics of Reverie’s users show a greater appreciation of sleep across many age groups and geographic areas. The company has operations in the US and China, with everyone from the more mature VC aged crowd to younger entrepreneurs and their children investing more in good sleep. Reverie not only provides the physical product in the form of proven power bases and many options, but a sleep coaching program as a part of their educational outreach.
Now the internet of things has facilitated the integration of smart beds with iPads, iPhones, Apple health trackers and sleep quality apps so that people can really use hard data to pick the right bed and sleeping position and get better sleep. We all know that when we feel more rested, we feel better and can perform better. Though probably the best testament to what Martin has been working on is the number of people who say “The hardest part about having your bed in our house is that when we travel, we’re miserable.” It’s a product that people really miss, and are miserable without.
In addition to being on this mission to open people’s minds the power of sleep and giving them the technology to get it, Martin Rawls-Meehan has now invested in other startups as well. This gives him a great perspective of not only having proven the hustle to build this brand and business, but to see the differences in what works for other entrepreneurs and startups, depending on their venture and goals.
The Mindset of a Bootstrapping Entrepreneur
Martin told our podcast listeners that even though he grew up with parents who were teachers, and not in what you might expect to be a traditional entrepreneurial household, he always liked to do things differently. He says, “If I saw people going left, I’d be very curious about what going right meant. I never wanted to follow the same path that I saw the people are following. I’ve always enjoyed the challenge.” When everyone else was doing banking and consulting after college, he found it exciting to take a new path and work with an old middle school buddy on sleep technology, and build something new.
Of course, he admits that starting a company in a totally new field at 22 was a little scary. He had taken East Asian studies at Princeton, and his co-founder had studied product design. Though, while those skills had some benefit for building relationships and eventually setting up business in China, they soon found they didn’t necessarily fall into a box where they used their college knowledge. As most real entrepreneurs find out, it’s a matter of throwing yourself into something, and then amongst the grit and elbow grease, finding out what you need to learn and investing time in getting that knowledge.
They hustled and learned on the way. That included taking a part time teaching job until the business could support a paycheck. It meant taking classes at Harvard night school on electrical engineering. It meant going to law school to learn the legal side of things to deal with the legalities and challenges that come with growing a successful business.
Getting the Right People on the Bus
A big part of growing any startup is the people. Today Reverie has 150 employees. In the US they have a plant in western New York for manufacturing, wholesale sales and support. In Detroit, MI is the R&D, marketing and some customer service.
Martin moved from Boston to Detroit, because that’s where he found the best combination of space for infrastructure, available talent, and affordable talent. As Reverie has grown he has gained more appreciation of the importance to “build up a very strong team of people that are independent and be less a part of the process myself. Because honestly, I can be a hindrance as much as I can be a help sometimes, and you know that there’s an obligation to build this thing to go well beyond me and my own capabilities.”
In fact, if he could give any advice to his younger entrepreneurial self, he says it would be to simplify and to get a grip on core values earlier and to not only hire great people, but to hire the great people who are aligned with those core values.
They say if you have the right people on your bus you’ll get there. If you don’t your bus won’t be headed in the right direction.
Battling 900 lb Gorillas & When to Raise VC Money
While Reverie still hasn’t attempted to raise outside capital, Martin says “If you want to dive head first into a massive branding effort in our industry and go out there and just swing for the fences and become the next $4 billion brand, you’re going to have to put some really serious money in to marketing, and you’re going to have to be prepared to absolutely fail. And I think at that point, you know, you’re not going to be able to do it from your own profits, and you’re probably not going to want to do it with just your own capital.”
However, if you don’t plan to raise big money you’ll have to compete for talent with the likes of Google and Apple, and other startups offering stock options. At Reverie that is done by paying people well, giving them a sense of purpose and enabling them to have a real and immediate impact.
If you’re not going to raise money, you also have to be prepared to fight bigger competitors who may choose to try and sue you out of business than to buy you out. Today Martin says that can easily cost you $1 million. Maybe $5 million if you go to trial. Since fending off these attacks at Reverie, the company has gone on to obtain 70 to 80 patents for its intellectual property, and to create a far more formidable legal force that doesn’t make them look like an easy target.
Listen into the full episode on the DealMakers podcast to get more details on this bootstrapping venture and for how to email Martin directly with your questions (listen to the full episode here).