39864 resthouse 41 20230206201040070

Problem

Mainstream bedding products do not respect people's individual sleeping needs.

Over a third of Canadians suffer from sleep deprivation. Generic bedding products have been used as a fix for bad sleep for the past few decades, but their effects are minimal. This has resulted in a never-ending cycle, in which people continuously switch out and throw away their bedding products while still experiencing sleep deprivation.

24 million mattresses are discarded every year in North America, the vast majority of which cannot be recycled. The mainstream mattress industry uses synthetic and mixed materials including chemical-based foams to bring cheap mattresses to market— there is no end-of-life plan or circular economy for these products.

Half of the consumers around the world reported a desire for more products and services to meet the need for high-quality slumber. There is a gap in the market for sustainable, high-quality products that respect individuals’ sleeping preferences, body types, and unique needs.

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Solution

Personalized, natural, and organic sleep essentials that care for you and our planet.

At Resthouse, we consider each sleeper’s unique personal needs. We curate customizable products and personalized solutions to mitigate common causes of poor sleep and treat each sleeper individually - even in the same bed. Our pillows and mattresses are designed to adapt to changing sleep preferences; sleepers may modify the density and mattress layers at any point in time.

Resthouse selects only the finest, natural, sustainable bedding products to ensure that people have the healthiest, most restful, and ecologically responsible sleep possible. Our carefully sourced materials, individualized, and modifiable solutions guarantee longer product lifecycles and less harm to the environment.

Through mindful education, perceptive personalization, and stunning organic materials, we build complete, natural, and adaptable sleep environments that transform people’s lives.

Products

An ecosystem of sleep essentials that work together to create healthier sleep environments from top to bottom.

We partner with suppliers and brands that share our view of only using the finest organic materials, working towards lowering our ecological footprint and providing fair-trade wages. These brands include Obasan, Coyuchi, Holy Lamb, and our brand - Kakūn. Obasan supplies our most customizable mattresses, Coyuchi offers ethically-sourced sheets, blankets, duvet covers, towels, and robes, Holy Lamb offers Premium Eco Wool Fleece toppers, and Kakūn provides the core line-up including mattresses, pillows, comforters, protectors, and toppers.

Meet Kakūn

Our own brand, Kakūn was launched in 2019. It is designed, developed, and tested in-house on Vancouver Island, BC. Our Kakūn range includes mattresses, toppers, comforters, body pillows, head pillows, mattress and pillowcases, protectors, and covers.

Kakūn is an ecosystem of sleep tools that work together to create healthier sleep environments. They can be slowly added to our customers’ existing beds, one piece at a time, or turn an entire bedroom into a natural sleep sanctuary in one fell swoop.

Personalize your sleep sanctuary

Kakūn is the manifestation of our entire sleep philosophy: natural, beautiful, adaptable, and customizable. Our products are customizable and can be modified at any point in time. Here is how:

Pillow

Whether your pillow preference is extra-plush or flat-and-firm, our customized pillows always deliver that just-right support simply by adding or removing organic rubber latex or wool filling.

Body Pillow

Our eco-wool and latex body pillows are available in a range of sizes. These pillows are optimal for hip and shoulder alignment.

Comforter

Our collection of ultra-breathable, dust-mite-resistant wool comforters comes in three different weights. We also offer a split option so we can customize each half of the comforter to fit your and your partner’s preferences.

Mattress Topper

Our toppers come in eco-wool and Dunlop latex options. They provide cloud-like comfort and added pressure point relief.

Mattress

We can customize your mattress according to different firmer or softer levels. We also offer split options in our king and queen sizes mattresses so each sleeper can select their preferred support and firmness- without compromise. The layers can be flipped and rotated for more even wear.

Philosophy

Our commitment to the environment.

At Resthouse, we’re committed to sustainability within our manufacturing and distribution pipeline. We only work with North American suppliers that meet our high standards. Our products are 100% natural, using 3 simple ingredients:

The Global Organic Latex Standard (GOLS) certified Organic Latex
Global Organic Textile Standard (GOTS) certified Organic Cotton
GOTS and Premium Eco-Wool ™ certified wool

We minimize returns and waste through our latex mattress comfort adjustment guarantee. We exchange a layer for free within the first 6 months to ensure customers have a bed that offers the right support. Our pillows and mattresses can be modified at any point in time, further reducing the need to purchase new bedding products as your body’s sleep preferences change.

Additionally, we upcycle the latex layer-producing remnants into Kakūn shredded latex pillows, further reducing landfill waste.

Traction

In 2022, we hit nearly $3M in revenue.

Since the launch of our retail store in 2015, we have experienced healthy growth year over year.

We have achieved nearly $3M in annual revenues.
In the past year, our average order value across e-commerce and retail stores has increased by 16%, bringing it to $860.
Our own brand, Kakūn, is growing at 70% YoY and has hit $0.9M in revenue.

Additionally, we have won Times Colonist 2021 Readers Choice Award - Furniture Store and the Duncan Cowichan Chamber of Commerce 2020 Black Tie Award: Green Business Category. We have also been featured in Douglas Magazines and on local TV and Radio Stations.

Business Model

We operate a multichannel Direct to Consumer model.

Our two main sales channels include our e-commerce website and 3700 sq ft retail store, strategically located in Uptown Mall in Victoria.

Our retail space is the ideal space for our “sleep-as-a-service” model where our Sleep Educators provide personalized pillows and mattress fittings. We also provide white-glove delivery service to our customers all over Vancouver Island, the surrounding Gulf Islands, and the lower mainland of British Columbia. We have experienced a 20% YoY increase in our retail sales since the opening of our new store in May 2022.

Our e-commerce website has supplemented our retail sales since 2015, growing substantially through 2020; it currently accounts for 22% of our total revenue. We have over 134,000 annual users with an average order value of $553. 54% of our users come from organic traffic, and the rest through paid initiatives, which has resulted in our cost of acquisition being $74.

As we grow, we aim to bring our “sleep-as-a-service” experience online. We will be developing a new Kakūn-focused website that walks users through our in-store fitting process. We will also be expanding our focus to the US market with the help of an approved CanExport grant.

Customers & Testimonial

Our healthy sleep community.

We’ve serviced almost 10,000 unique customers. With a Net Promoter Score of >85%, we successfully target educated professionals living in and around metropolitan areas whose growing awareness of sustainability drives high-quality purchasing decisions. Our target customer sees health and wellness as integral to daily life, is eco-conscious, looks for quality, long-lasting products, and seeks versatile, adaptable, and innovative products.

Our customers not only love our products, but they also appreciate our in-store service and the white-glove delivery experience.

Market Opportunity

Sleep is one of the 6 fastest growing wellness categories.

The wellness market is estimated to be $1.5 trillion USD, with an annual growth rate of 5-10%. As the prevalence of sleep disorders continues to increase at an alarming rate, consumers now demand better products for high-quality slumber. As a result, the global bedding and mattress market is currently valued at $150 billion USD.

Resthouse competes in the luxury bedding and mattress market which is currently valued at $6.5 billion USD globally. We anticipate a 20% market share of the North American luxury bedding and mattress market, which can be achieved in 10 years. We see an opportunity in aligning our sleep solutions with the broader wellness space.

Competitive Landscape

Our focused positioning and uncompromising standards set us apart from competitors.

As an increasing number of consumers are making their purchasing decisions around value alignment with brands, we effectively attract our target market as our products are rooted in sustainability and high quality.

Resthouse focuses on quality, long-lasting, strictly curated certified organic natural materials and products. Our products never use synthetics and petroleum-based foams or toxic off-gassing materials. We create and select quality constructed products that are adaptable and can be personalized to meet each individual sleeper’s needs, completely moving away from the one-size fits all commoditized approach of mainstream mattress and bedding companies like Casper and Endy.

We service our customers effectively by focusing on their unique requirements for recovery through a consultative “sleep-as-a-service” process (in person, virtually, by phone, and by live chat), seeking to discover the specific needs and challenges of our customers to make the right recommendations for optimal benefits and results for better sleep.

We deliver products that consumers actually need for high-quality slumber.

Use of Funds

We are raising on FrontFundr to support our next stage of growth.

Our vision is to build flourishing communities night by night by providing people with adaptable and personalized sleep environments. We are raising funds from our community to fuel our next stage of growth, which includes growing our brand, expanding our retail footprint, increasing our marketing efforts, and growing our sales.

Exist Strategy & Industry Comparables

Acquisitions in the bedding industry.

There are generally 3 ways in which an investor may realize a return on their investment:

Liquidity by a strategic sale of Resthouse to another company.
Resthouse makes an application to go public (IPO or similar process).
Resthouse focuses on growth and distributes dividends to investors.

All three are possible outcomes for the company at this time. With recent activities in the bedding industry, we believe that a strategic sale to a company that holds similar value to Resthouse or focusing on growth and distribution of dividends to investors are two exit strategies that we think are most likely, with the third option being the least likely path.

Below are examples of recent acquisitions in the bedding industry:

Future Goals

Resthouse as the market leader in providing organic and sustainable sleep solutions.

Our mission is to build complete, natural, and adaptable sleep environments that help transform people’s lives. Our team has over 20 years of experience learning about the way people sleep, and we are excited to continuously share our knowledge with a growing community. In 3-5 years, our goal is to add one additional flagship retail store and grow our Kakūn brand.

Over the next year, we are going to be focusing on the following items to fulfill our mission and long-term goal:

Increase Kakūn’s product offerings. We are in the process of developing Kakūn’s range of sheets.
Grow our strategic accounts.
Grow our online sales, including USA.
Expand our marketing efforts through an increased focus on email marketing, social media, and influencer marketing.
Hit $4M in revenue in FY 2023.

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Join us in becoming an investor today. Let’s build sustainable sleep environments together!

Thank you!

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