Key Stats: Sleep Better Foundation on Wefunder
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The Sleep Better Foundation team has been selected as an “Underweighted Deal” by KingsCrowd. If you have questions regarding our deal diligence and selection methodology, please reach out to email@example.com.
The Centers for Disease Control and Prevention (CDC) reported in 2016 that Americans are not getting enough sleep. More than a third of Americans sleep less than the recommended seven hours per day. The CDC noted that sleeping less than seven hours per day is associated with an increased risk of high blood pressure, diabetes, obesity, and heart disease.
The CDC separately reports that about 70 percent of Americans struggle with chronic sleep problems. One in four Americans develop insomnia each year, though about 75% of those ultimately recover without long-term sleep issues. Furthermore, 26% of adults between 30-70 suffer from sleep apnea. Dr. Timothy Morgenthaler, President of the American Academy of Sleep Medicine, said in 2014 that “obstructive sleep apnea is destroying the health of millions of Americans, and the problem has only gotten worse over the last two decades.”
Sleep is quickly becoming one of the most concerning health issues facing Americans today, as it contributes to dangerous epidemics like obesity and heart disease. Unlike other health issues, many Americans don’t know what to do to fix their sleep issues. Various therapy and counseling providers treat sleep issues, but therapy is notoriously difficult to access. Sleepers everywhere are in need of a convenient, accessible sleep solution.
Sleep Better Foundation is launching a virtual sleep coaching app. The app is meant to connect troubled sleepers with online coaches who will guide them through a research-backed program to improve their sleep. Users pay three installments of $30 each to access a self-paced better sleep curriculum. Users are led through the program by animated online coaches who can deliver service in both English and Spanish.
Sleep Better believes that its virtual sleep coaching app is a scalable way to help the millions of Americans that struggle with sleep. In-person therapy and coaching options fail to assist sleepers when they need it most: in bed at night. Moreover, one-to-one relationships between a patient and coach are difficult to scale given challenges with scheduling and cost of service.
The Sleep Better app is slated for launch in October 2020. The team plans to obtain 20,000 users in the app’s first 12 months, representing 0.1% of US market share. Sleep Better Foundation is currently pre-revenue, and averages $6,481 in operational expenses each month. The company projects generating $500,000 in revenue in year one post-launch, with just over $750,000 in expenses.
Sleep Better Foundation’s three key team members are Joseph Dzierzewski, Ph.D., Lorena Rojas, M.D., and Laurie McDermott. Dzierzewski is the company’s Co-Founder and Vice President of Sleep Services. He has over 15 years of experience researching sleep disorders. He has published 80 scientific papers on the subject backed by $4 million of research grants.
Rojas is a Venezuelan native fluent in Spanish and English, and serves as Sleep Better’s Co-Founder and Director of Hispanic Services. Rojas is key to the company’s efforts to reach Spanish-speakers with virtual sleep coaching.
McDermott, Sleep Better’s President, focuses on users’ experience with their sleep coach. McDermott’s past experience is in travel writing and comedy.
Additional team members include Brad Dillman, Vice President of Business Development. Dillman has experience in sales at healthcare companies like Cardinal Health. Adam McCue, Sleep Better’s Chief Technology Officer, serves as an IT project manager at UCLA Health.
The most important milestone on Sleep Better’s roadmap is the launch of its virtual coaching app capable of hosting encrypted coaching sessions, slated for October 2020. The team reports that the biggest obstacle in the way of successful launch is the final coding of the app and online animation for virtual coaches. Sleep Better must also hire professional actors to voice over virtual coaches in both English and Spanish.
After launching the first version of its app, Sleep Better will continue to add new language options. The company will also focus on customer acquisition through B2C marketing tactics like paid advertising and pursue B2B opportunities via relationships with employee wellness programs.
After careful consideration of the company’s areas of opportunity and seeming weaknesses, Sleep Better Foundation has been ranked as an Underweight deal. Investors should consider two critical uncertainties when evaluating this deal:
- Competition in the telehealth space: While Sleep Better Foundation may be correct that there are few sleep-specific online coaching providers, the broader telehealth space has several market leaders that could easily incorporate sleep into their slate of offerings. Companies like Teladoc and PlushCare (general telemedicine providers) or Maven Clinic and BetterHelp (focused on reproductive health and mental health, respectively) are just a few examples of companies with proven capability to deliver virtual wellness services with excellent user experience and compliant data storage. Sleep Better Foundation seems to offer minimal differentiation from these companies. It would struggle to compete with their technological sophistication and capital resources if any of them added sleep coaching services.
- Pre-launch software business from non-technical founders: Sleep Better Foundation’s product has not launched yet, and investors are therefore unable to assess the team’s capability to produce an appealing telehealth software product. Users’ experience engaging with coaches through the Sleep Better software will be critical to the company’s success, and it is difficult to safely assume that non-technical founders can produce a compelling app in line with competitors’ offerings.
Sleep Better Foundation is addressing a pressing health and wellness concern that impacts millions of Americans. However, the business has not yet launched its core product. It is also entering a very competitive space where leading companies are already delivering high-quality telehealth or virtual coaching-type services. Therefore, Sleep Better Foundation is an Underweight deal.
About: Katy dolan
Katy is a marketing and research consultant to startups (including VC-backed companies, small businesses, and advocacy movements). With experience in tech, venture capital, politics, and non-profits, Katy partners with clients to strategize and execute compelling campaigns focused on user experience and empathetic narrative. Katy graduated cum laude from Harvard College with an AB in Sociology.