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For Chaitanya Ramalingegowda, a routine is crucial. Be it sticking to a schedule while working from home, getting enough sleep or building some semblance of work-life harmony, it is something that has always helped him cope. It’s something he encourages his team to develop too.
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The Bengaluru-based co-founder and director of sleep and home solutions venture Wakefit, founded in 2016, says maintaining his pre-pandemic routine—getting to his desk by 9am, having lunch at a reasonable hour, working till 8-9pm, going for a post-dinner walk and ending the day with a book—has anchored him. “Otherwise, there is no structure to the day,” says Ramalingegowda, 40, during a Zoom call from his home. “I have seen this with colleagues and friends.”
In just five years, Wakefit has disrupted the mattress industry, bringing a product that was largely offline, online—and building recall value. Started by Ramalingegowda and Ankit Garg, the firm saw revenue jump to ₹410 crore in FY2021, over twice as much as the previous year. In July last year, it ventured into home décor and furniture products like beds, bedside tables, work-from-home furniture and TV units. With work from home the norm, the expansion came at an opportune time. Today this segment generates 20% of their revenue. Mattresses constitute nearly 70% of sales; accessories like bed linen make up the remaining 10%.
Bootstrapped for three years, Wakefit is valued at ₹2,000 crore after its Series B funding last year. It raised ₹185 crore in that funding round. In its Series A funding in 2018, they had pitched to 31 investors; only Sequoia India proved willing to place a bet on their online plans.
Wakefit claims to have a 35-40% of the online mattress market share. It has fresh competition online, with brands like SleepyCat, Wink & Nod and Flo Mattress, but Ramalingegowda says their products are 30-40% cheaper, with mattress prices starting from about ₹6,000.
One of the largest teams, about 300 of its 750 full-time employees, is the consumer delight team. It contacts customers after a sale to check on satisfaction and offer tips on care. “It’s really low-cost marketing but through this gesture we remain in the customer’s mind,” says Ramalingegowda.
Since the pandemic, tier 2 and 3 cities have been accounting for half of Wakefit’s revenue. “A lot of people moved back to their home towns and started ordering for themselves and their families from these smaller cities,” says Ramalingegowda. This has come with its own challenges: poor logistics networks, handling issues with furniture products, the availability of skilled carpenters to install the products. Most of the latest round of funding, then, has been invested in capacity expansion: factories, warehouses, skilled carpenters and machine operators. Today they have factories in Bengaluru, Hyderabad, Jodhpur, Delhi and Pune.
In December, the company launched a Wakefit gurukul, offering offline training in six cities to people with some knowledge of woodwork as well as ITI graduates, teaching carpentry and machine operating work, along with soft skills like customer communication. The trainees are paid a stipend. The approximately 400 people trained so far have been absorbed by the company.
Ramalingegowda believes Wakefit has got the timing right. According to a 2018 report by management consulting firm RedSeer, the Indian mattress market, online and offline, is estimated to reach ₹250 crore by 2022. The market size of bed linen and accessories, according to the Indian Sleep Products Federation, is nearly ₹350-500 crore in the organised sector, and a RedSeer report puts the online furniture market at around ₹1 trillion. “We are in these three segments and so the scope for this industry is massive. Our aim is to continue to do a good job, not to lose customers’ trust and not mess up anything that will make them doubt Wakefit as a company,” he says.
Keeping it low-cost
Ramalingegowda doesn’t believe in swanky showrooms for his experiential centres. To him, it’s more important to build affordable products that don’t compromise on quality. Nor does he believe in expensive campaigns for branding and marketing, preferring to remain low-cost, quirky and humorous. “I don’t think we are going to sponsor the IPL (Indian Premier League) or some cricket jersey. It doesn’t make sense. We saw companies raise ₹200-300 crore and burn through it in nine months, and then they were back into the peak of fund-raising market in 2014-15.”
Interestingly, one policy that gave them sleepless nights initially was their offer of a 100-day mattress trial. Any misuse could have proven costly. “Even if 15-20% of the people returned the products, it would have killed us.... But nothing changed; the number has consistently remained 3%,” he says. Inevitably, there have been some bad experiences. Like the family preparing for a wedding that ordered 15 mattresses, returning them 20 days later.
A clever marketing gamble that attracted immense attention was the roll-out of sleep internships in 2019. This year, the second batch was recruited. The interns are paid close to ₹1 lakh. Their job: to sleep for nine hours for 100 nights on a Wakefit mattress along with a sleep tracker. Besides gathering data on sleep patterns, the aim is to engage and create a shift in sleep cycles.
The inspiration came from an unlikely quarter—social media discussion in 2018 that the prime minister slept only for four hours. “We thought why not turn the whole narrative on its head and celebrate people who prioritise their sleep over everything and do not sacrifice it,” Ramalingegowda recalls.
Ramalingegowda and Garg have gained from their experience of working for Tapzo, a multi-services app, in 2015. “What we ended up seeing was that revenue and profits are permanent, valuation is temporary. If the revenue and profits are on your books, you can really control the destiny of your company.” They only went in for Series A funding two and a half years after launch, but turned profitable within three months of starting out. Over the last three years, the core team has expanded to include a chief financial officer, chief technology officer and head of growth. It has helped them catch a few extra hours of sleep as “you aren’t firefighting all the time. I think I have gotten better at it (sleep),” says Ramalingegowda.
Ramalingegowda, who started working in 2002, describes himself as an explorer. Certainly, he has a rich CV. After completing his engineering degree in Mysuru, he started work as a techie in Bengaluru. Two years later, he enrolled at the Indian School of Business, Hyderabad. “It was amazing as the experience fed into my deeper streak of exploring everything. After slogging really hard for the first two terms, as I wanted to be in the top 5% of the batch, I realised I was not going to make the cut. So I decided on gaining as much knowledge as possible by making use of resources in the library, attending all guest lectures, while maintaining decent grades,” he says.
He joined Deloitte Consulting in Hyderabad in 2005 but got a real taste of the consulting life, with visits to the US and Canada, when he joined Cognizant’s strategic services in 2006 and Zinnov Management Consulting in 2008. “I became a very big generalist as I got exposure to different functions of the company like operations, finance, organisational structuring, and in varied sectors,” he says. In 2011, he quit to become an entrepreneur. “I thought I will be my own boss.”
Turning entrepreneur
His first startup, co-founded in 2011, was a web-based dating app, A Billion Reasons. Ten months later, when his co-founders left, he pivoted to a relationship app, TwolyMadlyDeeply, that promoted events to help singles find dates and allow couples to spend quality time together. He shut it down in 2013; he didn’t see it scaling up. “Entrepreneurship is one of the few fields where hard work probably doesn’t guarantee any success. There are a ton of external factors that are completely out of your control,” he says.
His next startup, New Love Times, was creating an online community for women to seek, and offer, advice on aspects ranging from careers to health and wellness. The community grew to a million but, again, he couldn’t see it growing further. “Also, I wasn’t enjoying it,” he says. It closed in 2016 but he had started working for other startups from 2015.
His confidence was shattered. “You have spent four years, closed down two ventures, you don’t know what you have learnt, you have no money in the bank, and you are open to any job that is there at that time. You think, are you cut out to be an entrepreneur? If you go back to your job, are you going to retain your confidence, which you had four years back? You don’t know anything,” he says.
Through 2015, he did four-month stints with online media venture YourStory and LetsVenture, a platform that helps with early stage funding, apart from Tapzo. This was when Garg, who has experience in the foam industry, noticed the considerable variation in costs when he was looking to buy a mattress. To understand the pricing system, he bought a few hundred mattresses and put them up for sale on Amazon. He made a profit of ₹60 lakh.
The concept of Wakefit took root. Garg and he saw potential in the idea— but Ramalingegowda could only join the company full-time after a year. “We could only pay one person’s salary,” he says. He has become pragmatic, even stoic, now. “There was humility to acknowledge that even this might fail. But I thought, what is the worst that can happen? I have gone down to zero bank balance and lived on almost nothing. I would go back to a job if this fails. So then there was no fear.”
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