In the Direct-To-Consumer (D2C) market, the past few years have seen considerable disruption. The opportunity it provides to reach out and communicate directly with consumers has prepared young companies to develop their ventures into products, without relying on old and complicated wholesaler or distributor network structures.
The COVID-19 pandemic today has only further illustrated the potential for D2C brands to expand amid difficult market conditions and the constraints of conventional retail and their dependence on wholesale distributors and secondary retailers.
The D2C sleep and home solutions brand based in Bengaluru, Wakefit.co, is one such business that has powered growth based on the twin pillars of product creativity and customer-centricity. Launched in 2016, the company has seen a 3x increase in annual revenue since its inception, with a mission to promote a healthy sleep culture with its products.
Over the years, the company has extended its portfolio from retailing mattresses online directly to consumers to include bed frames, bed sheets, comforters, neck pillows, pillows, back cushions, and mattress protectors. Wakefit.co also partners with start-ups and corporations who understand the need for workers to de-stress and also have nap rooms set up in their offices.
Today, Wakefit, had Rs 200 crore in FY20 revenue, was profitable, and didn’t even use half of the $10 million it raised in 2018 from Sequoia Capital.
But these huge numbers, the big revenue all this was a distant dream for the founder Chaitanya Ramalingegowda. As he was coming from back to back closure of his two previous ventures.
But in his latest venture, you can see signs of his history. That Wakefit is profitable is because its co-founder was on the brink of catastrophe, and lived to see another day, a word rarely associated with VC-backed startups.
Chaitanya did as many do, armed with an MBA from the Indian School of Business-one of India’s best business schools.
He made money working for consulting companies such as Deloitte and Cognizant. In 2011, with a dating-related app, he left all that and began to encourage people to meet up and enjoy traditional activities such as wine tasting, pottery, and dance classes. It sounds much more complex than the swiping blockbuster to accept/reject the technique employed by Tinder, but it did not work.
There were new online dating and interactions, almost unheard of online payments, and the bit of luck every founder needs was also absent.
So, he shut down Flutterby Services, but it began again at the end of 2012. An online women’s group-in the space of human relationships again, just not exactly dating.
This one showed a little more momentum, angel support was also boosted. But soon, they only survived by pivoting a vital product or service-working only to make the next payroll, working through nights, operating without the greater aim that successful startups have.
In both situations, not only did his start-ups fail, but he soon lost. He knew it would go nowhere in a year, and the thrills of entrepreneurship gave way to the chills of a depressing bank account.
All his savings were invested in his start-ups, and only by doing part-time consultancy again-on alternate days and sometimes nights-did he even pay rent. He was nearing burnout.
I had never seen loss before then. I was an engineer with a fancy MBA degree, and now neither I nor my business have any cash at all. You’re helping yourself as an entrepreneur, but for how long? , “he marvelled.
He was also unable to admit defeat, even though he later realised it was looking him right in the face. Self-doubt crept in, and self-doubt can be debilitating, particularly for an entrepreneur, given that the biggest investment of a creator is himself and his sometimes crazy yet necessary amounts of self-belief.
Chaitanya joined Tapzo (previously HelpChat) which was acquired by Amazon later on. He met his future co-founder Ankit Garg there.
They founded Wakefit, in late 2015. Until D2C became the buzzword to land a term sheet from an investor, and a micro-sector with hundreds of startups today, a direct-to-consumer D2C brand.
Wakefit has achieved much more than his previous startups. It has bounced back in spite of the pandemic hitting the industry hard. Though it had Rs 25 crore of revenue in August 2019, this August it had Rs 50 crore of income.
Stories such as of Chaitanya & Wakefit make us believe that nothing is hard to achieve and you should never give up in life.