She Never Wanted to Start a Business, But Chronic Insomnia Was Motivation — Here's How She Achieved $20 Million in Sales and 8 Hours of Sleep a Night


Dr. Kathrin Hamm, founder and CEO of sleep-wellness company Bearaby, never wanted to be an entrepreneur. After graduating with her Ph.D. in economics, she started as an economist at the World Bank. Her work took her all over the world and provided invaluable insight into the small, medium and women-founded enterprises she tried to convince banks to lend to — but she “learned firsthand how hard it is, especially in developing countries, for women to get access to finance and start and grow their businesses.

During her time in India and Bangladesh especially, Hamm faced long, “exhausting” travel days. She’d “never been a good sleeper,” waking easily even as a child, and she developed a chronic case of insomnia. It began “on a more moderate level,” with difficulty falling and staying asleep, before the periods of wakefulness became longer and longer, motivating her to look into different solutions.

1710767540 Kathrin Bearaby 1Image Credit: Courtesy of Bearaby. Kathrin Hamm.

She started by investigating various mattress options, but when she dug deeper, she found an article discussing weighted blankets. The piece focused on helping children with sensory issues, Hamm recalls, but it also mentioned that evenly distributed weight on an adult body could support better sleep. Hamm was immediately intrigued — as a potential customer.

Related: The No-Excuse Approach to Sleep and Work Performance for Entrepreneurs

“Let me buy a product, sleep better and then move on with my career.”

“I came from a consumer lens,” Hamm says, “and knowing how hard it is for women to start a business, I [was] like, Yeah, I’m good here. I don’t want to start a business or even think about becoming an entrepreneur. Let me buy a product, sleep better and then move on with my career.”

However, the purchase process proved difficult. Unable to find options online, Hamm had to go to a pharmacy in Germany, where she’s from, to place an order. Six weeks later, a “big bean bag” arrived. It was orange and blue and “very noisy,” Hamm says. She was reluctant to even try it at first and wondered if she’d made a mistake.

“But then I put it on during the day on a weekend, and I just passed out after 10 minutes,” Hamm says. “And I woke up more than two hours later, [after] a solid nap, completely passed out, and I’m like, Wow, this is magic. This thing works for me.

Related: Fighting Sleep Is a Losing Management Strategy. Let Your Employees Take Naps.

So Hamm kept using the blanket at night, but there was a problem: Because the blanket was filled with plastic beads to add weight, she often got too hot. The underlying functionality works; the weight on my body works, Hamm remembers thinking, but how it is made doesn’t work. After some research, Hamm discovered that the technology, which largely consisted of bead-filled chambers between layers of blanket, had been around for 30 years — “Nobody had innovated anything about this product.”

“Why can’t you just use strips of cotton?”

Hamm decided to experiment with alternative designs. She drew some inspiration from her time spent in India, “where there’s a culture of making rugs, knitting, crocheting,” but the ultimate breakthrough came from a conversation with her mom. Hamm had been considering changing the material or adding holes for airflow when her mom said, “Why can’t you just use strips of cotton?” They would create a thick yarn that could be knit together for natural airflow, eliminating the need for heavy artificial materials that shift around and reduce comfort. That idea led to the development of Bearaby’s first small blanket, made from a cut-up t-shirt.

Confident she was onto something, Hamm opted to take a year’s leave from her job to focus on the business. “I didn’t want to take too much of a risk, again, knowing that it can get really hard,” she admits. “[But] my boss was super supportive, and she said, ‘Look, if it doesn’t work out, we make a case study out of it.'”

Hamm withdrew $120,000 from her retirement fund and raised just over $250,000 from a crowdfunding campaign to fund the prototypes for the first batch of blankets. She also looked into patents, but they were expensive, so she did the drawing herself, then had a lawyer put together a provisional patent application, which entitles the filer to 18 months before they have to pay more money. That went through just a couple of days before launch in December 2018; the blanket sold out in two weeks and was the only product of its kind on the market for a couple of years, Hamm says.

1710790300 CottonNapper Bed Hugging 2 CloudWhite1Image Credit: Courtesy of Bearaby

Related: How to Take Advantage of the ‘First-to-File’ Patent System

Despite the early success, the more than 50 factories that Hamm approached weren’t inclined to take on the product. They’d never seen anything like it: It wasn’t apparel, and it wasn’t bedding. So, for that first year and a half, Hamm rented a small garage outfitted with knitting machines and knitters to churn out the first products. The strong sales helped the business continue to finance production, which was a good thing, too — because people still weren’t all that interested in investing in the first-of-its-kind product.

“In hindsight, we had to learn to be profitable.”

Hamm leaned into the “bootstrap” mentality, which was a blessing in disguise. “In hindsight, we had to learn to be profitable,” she explains, “to become in tune with our production processes and marketing processes, to be efficient, which sometimes you didn’t see at that time in the direct-to-consumer space. Everyone was like, ‘I raised that much money, and I’m putting that much million on a marketing spend.’ So we never had it, but now, in an environment where money is not flowing [as] freely, we never had that money in the first place, so we are feeling pretty good right now.”

Bearaby saw another major advantage in brand loyalty. Hamm notes that people seeking wellness and sleep tend to form an “emotional connection” with the blanket,” and that it’s easy to fall in love with a brand that helps you sleep better. Substantial interest also translated into an early retail presence. Just five months in, Bearaby was in West Elm, thanks to customers who walked in and wanted to try the blanket. That happened with Nordstrom, too.

Related: Customer Loyalty Is Your Holy Grail for Success. Here’s How to Cultivate It.

As Bearaby considered expansion, it centered on functional products that would uphold its commitment to quality and sustainability (the company is certified by third-party organizations, including The Global Organic Textile Standard, The Forest Stewardship Council and The Global Recycled Standard). Because anxiety so often goes hand in hand with insomnia, the company landed on its warmables line; boasting a weighted and heated neck wrap, bottle and lap pad, it “takes the nervous system to zero,” Hamm says.

1710790346 LoungerBlanket Sitting Bedroom MoonstoneGreyImage Credit: Courtesy of Bearaby

Naturally, Bearaby’s products have become an integral part of Hamm’s own sleep routine, and as she’s gotten older, she’s realized even more just how much sleep she actually needs. “Now I sleep for a minimum of eight hours,” she says. “I’m training myself to get nine to 10 hours of sleep, obviously not every night, but definitely every weekend. Also, [it helps] whenever I get a chance to take a nap, like just a 20-minute nap to reset. [I make sure that I have] these conscious breaks, whether [it’s] napping or deep breathing because running a business is a marathon, and if we don’t take care of our bodies, we’re not able to do that over a very long time.”

“Just have tunnel vision for one year, and then reevaluate after those 365 days.”

Hamm’s five-year marathon with Bearaby has led to over $20 million in sales and more than 10 patents — but it all started with a single, somewhat reluctant leap of faith. And according to the founder, that’s exactly what it takes to be successful.

“Once you believe in a product, just take a chance and give yourself a year,” Hamm says. “It’s much more manageable if you [have] a considerable time frame where it’s like, Okay, in that year, I’m giving everything I have, 100%. Because sometimes we second guess ourselves. After [a few] months or six weeks, we don’t see the success, [and] we start doubting ourselves. You say [I have] one year, and I’m not asking if this is working. Just have tunnel vision for one year, and then reevaluate after those 365 days.”



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