As a college student transitioning from home life to dorm life, Steven Van Alen was jolted by a harsh reality of campus living – the notoriously uncomfortable mattress.

“Students usually have no choice but to sleep on thin, sometimes used mattresses that are provided in their dorm rooms by the university,” said Van Alen. He experienced it firsthand while staying in a dorm at California State University, Northridge, in 2016.

“I watched my friends, classmates and myself suffer from lack of sleep due to substandard sleeping solutions,” he said. “Since you can’t really easily change the mattress, an easy solution was a mattress topper. That’s when Sleepyhead was born.”

Mattress toppers already existed, but none that exclusively catered to students living on a college campus. So Van Alen launched Sleepyhead in March 2018, with the goal of making icky dorm room bedding a little more tolerable and hygienic.

Steven Van Alen, Founder and CEO of Sleepyhead Inc.

In its first year, the company has already scored a partnership with Dormify, an online dorm decor retailer, and landed a contract to sell toppers to students across 900 universities nationwide.

Sleepyhead turned a profit last year, Van Alen said. He expects the company to pull in $600,000 in sales this year and cross the $1 million revenue mark in 2020.

He has also established Sleepyhead as a benefit corporation, or a hybrid between a corporation and a nonprofit. For every 10 toppers sold, the business donates one topper to nonprofits that work with the homeless. Van Alen was inspired by his sister, who was homeless and pregnant as a college student, he said.

A serial entrepreneur

By the time he started Sleepyhead, Van Alen was no stranger to entrepreneurship.

He grew up in California’s Central Valley region and moved to Los Angeles when he was 18 to attend Santa Monica College. But he dropped out of school after two years to start a “zero-emission” landscaping business instead.

“I am a huge proponent of saving the environment,” said Van Alen, now 28. He operated the business for a year and a half, but eventually sold it. “I realized I couldn’t scale it singlehandedly and exited it,” he said.

A year later he set up an indoor landscaping business to install and maintain plants in work spaces, which he sold two years later. Van Alen wouldn’t disclose who bought the businesses but said both sold for six figures.

By 2015, Van Alen was onto his next venture, a nonprofit called Imagine Clean Air LA. He describes it as a charity focused on mitigating air pollution, illnesses and noise by replacing gas-powered equipment, such as lawn mowers, with battery-operated machines. Though he still runs that organization, he decided to go back to school the following year.

An affordable sleep solution

A self-professed “sleepyhead,” Van Alen was pursuing an international business degree at California State when the mattress topper startup idea came to him.

He then spent two years researching the bedding market, the production process, and the functionality of memory foam, as well as interviewing manufacturers.

“My vision was to sell toppers tailored to college students that they’d buy in their freshman year and would last them until graduation,” he said.

Given that close to 2 million US high school graduates enter US colleges for the first time every year, Van Alen was confident it would be a sustainable business. He estimated the market size could be even higher, between four to five million students, if you include other grades and international students who live off-campus.

In its first year, Sleepyhead scored a contract to sell its dorm mattress toppers to students across 900 US universities.

With manufacturers lined up, Van Alen funded Sleepyhead with $100,000 in personal loans and 0% interest credit cards.

But one of the first things he needed to figure out was how to price his product. The closest competing product in the market was a three-inch Tempur-Pedic mattress topper for $300. “So I tested a three-inch topper priced at $150,” he said.

Van Alen surveyed students at the University of Southern California, asking their opinion about his pricing. The feedback was that $150 was too high for budget-strapped students. “We needed to create one at or around the $100 mark.”

So he tested a two-inch memory foam topper for $95. “It took off,” he said.

Today, Sleepyhead sells two types of toppers in two- and three-inch options. One is made with gel memory foam and costs between $95 and $180, depending on the size. The other is a copper-infused topper, which helps with cooling and is dust and mite resistant, for $110 to $190.

Sleepyhead’s mattress toppers are produced entirely in China. As demand ramps up, Van Alen is looking to manufacture the toppers in the United States, “to be closer to the market” and save on costs.

He’s also monitoring the ongoing US-China tariffs war, which has led to higher business expenses for many small businesses importing from China.

“So far toppers haven’t been a part of the [tariffs] conversation, but I am worried,” he

‘Persistence is a quality you want in an entrepreneur’

In November 2017, Van Alen sent an Instagram message to Shawn Nelson, founder and CEO of furniture retailer LoveSac (LOVE), asking to connect with a fellow entrepreneur.

“I never responded that first time, but Steven was pretty persistent. Persistence is a quality you want in an entrepreneur,” Nelson said.

Nelson eventually became a mentor and invested $150,000 in Sleepyhead.

Van Alen won $20,000 for Sleepyhead, and first place, in a 2017 business contest at California State University.

Having Nelson as a mentor also helped give Van Alen credibility. It mattered when he approached investors. “They took notice of me and Sleepyhead because of Shawn,” he said.

To date, the startup has raised $385,000 in total funding from investors, including Steven J. Heyer, former CEO of Starwood Hotels and Resorts Worldwide.

Van Alen has ambitious plans for Sleepyhead, like expanding into bedsheets and pillows.

“I want Sleepyhead to be the name brand that students ask for when they move into college and also when they move out,” he said. “I want them to continue their sleep journey with us.”