Endy founder hopes to carve out success with new venture
Not everyone takes a startup and scales up to $250 million in sales within three years and then sells it for nearly $90 million. But Mike Gettis and Rajen Ruparell did exactly that with Endy, the direct-to-consumer mattress-in-a box business that helped change the way people buy such products.
Now, Gettis is looking to repeat that success, and more, with his newest venture, Kilne, an online cookware company he co-founded and launched this November alongside his wife, Noelle Hjelte.
They're hoping to drive sales to $1 million in the first year, and expand internationally from their Toronto home base, despite what some would think is a drawback in starting out during a pandemic.
Turns out, though, Gettis also thinks recessions are a really good time to start a business. For one thing you're selling a product at a very early stage, which means you're not punching against the demand curve,” he said, adding that governments try to support new businesses even more during such times.
For example, the federal government injected $20 million in funding to Futurpreneur during the pandemic. Gettis said he will access government programs, which he believes are essential to supporting entrepreneurship and innovation, but a lot of the success of his new venture will rely on some of the lessons he picked up from growing Endy. At least, that's the plan.
“We want to build a global brand around the kitchen,” he said. “We're starting with knives, but want to expand to cookware, bakeware and, eventually, appliances.”
Cookware and appliances represent almost a $15-billion market in North America alone, and it's growing, according to research firm NPD Group. Sales were up 24 per cent for the three-month period ending Aug. 31, 2020, compared to the same period last year, driven by the pandemic and the shift to staying home.
Of course, it's very early days for Kilne — it's only been open for business for about a week — but Gettis and Hjelte are focused on making it easy and affordable for people to buy quality cookware.
“It's similar to the journey with mattresses and Endy on the sales retail side, where we thought we could build something better,” he said.
It's hard not to hear or see ads for similar bed-in-a-box e-commerce companies today, but Endy was fairly novel in 2015 when Gettis and Ruparell launched the company. They looked at brands such as eyeglasses manufacturer Warby Parker that were just starting to sell directly to consumers for inspiration.
“We saw the opportunity to do the same with other verticals,” Gettis said. “We also saw Canadians were underserved in terms of online shopping. At the time, I believe Amazon only had one or two warehouses here. Canadians weren't getting items shipped fast enough. By focusing on Canada, on sleep and mattresses, and selling direct-to-consumer, we thought we could carve out a space for ourselves.”
Customers apparently agreed, and Gettis said the focus on the Canadian market was a key to success.
“Having a presence in Canada mattered. People wanted to support a local business as opposed to a company from a different country,” he said.
This preference seems particularly true today, given that research from Google shows 66 per cent of shoppers plan to shop local this holiday season even though many are being advised to stay home.
Gettis also credits having a business partner with Endy's success.
“Co-founding a business is a better way to go, because you're able to serve as a sounding board for each other and kill bad ideas quickly,” he said.
For such partnerships to be effective, Gettis said co-founders should bring different competencies and complementary skill sets, establish what each is great at and then let each other be great. This also helps define roles.
“With Endy, Raj had been head of global sales at Groupon, doing partnerships and B2B sales deals. I came from managing demand forecasts, supply chain and operations,” he said. “Now, with Kilne, my wife brings marketing and communications experience.”
One of the big lessons from Gettis's partnership with Ruparell was the importance of candour.
“You have to be clear about where you want to land, why and what your case is,” he said. “If you're not completely upfront, you can end up going with the flow, which is not always the right thing to do.”
This idea became a value at Endy: Care enough to be candid.
Another Endy lesson and value: Fail fast, learn faster.
For example, one of Endy's early marketing strategies was an initiative Gettis calls Uber water. At the time, Uber was viewed as cool and popular. “We thought people who ride Ubers would probably be the same type of people who might want to buy a mattress online,” he said, so they distributed water bottles with Endy logos to Uber drivers. “We didn't see any sales lift. For the amount of effort it took, the cost benefit wasn't good enough to be a marketing strategy.”
There were other failings, too, mostly around ideas that didn't scale well. Something that might work one-to-one, or even oneto-100, may not scale to oneto-1,000, which is where a lot of marketing teams can get stuck.
“They have a brilliant idea, but how do you scale it cost effectively? And does that idea actually resonate with customers? We were continually reinventing the marketing strategy,” Gettis said.
In Endy's early days, marketing was directed to people like its co-founders: They were in the startup community or liked the business model, or were early adopters and e-commerce shoppers.
“The types of things that resonated with the lead users did not resonate with the suburbanites who hadn't bought anything online before,” Gettis said. “They didn't care if Endy was a cool startup. They just wanted a good mattress. We found another gear when we changed the messaging.”