How a rejected mattress startup created an entirely new category, and found one of its biggest opportunities by studying women.

Now that I’m finally home after 60 days of living out of a suitcase, I can tell you one of the things I missed most was my Eight Sleep. I genuinely notice the difference every single night I sleep without it.

So full disclosure, I am probably the easiest person in the world to sell on why sleep is important. I truly believe it is one of the highest ROI things I can do for myself and Courtney and I target eight hours every single night. Not eight hours in bed. Eight hours of ACTUAL sleep.

I have also advised a company in the women’s sleep space, so I have spent more time than the average person thinking about how women sleep, how our sleep changes throughout our lives and, importantly, how little research ever existed around it. (spoiler: it’s not much.)

But Eight Sleep started 12 years ago with a much simpler observation. We had technology for space travel, but the mattress industry had barely changed since NASA invented memory foam in the 60s. Matteo Franceschetti, one of Eight Sleep’s co-founders, had optimized basically every part of his life except the eight hours he spent asleep. So the question became: why was his mattress still foam?

Fast forward to today. Eight Sleep has analyzed more than one billion hours of sleep data and earlier this year raised $50 million at a $1.5 billion valuation.

And the more I dug into this business, the more I realized there are a few things happening here that are MUCH more interesting than a mattress company becoming a unicorn. Here’s what I want to get into:

So let’s get into it!!

The founders did not have the obvious resumes for this

Eight Sleep was founded in 2014 by four co-founders, including now husband and wife Matteo Franceschetti and Alexandra Zatarain (founder couples will always do it for me).

But they did not get the product right the first time. Their first idea was an entire smart mattress but after being rejected by Y Combinator, they crowdfunded it and ran into a problem that feels pretty obvious in hindsight (as they always do). People who already owned a mattress they liked did not want to throw it away just to get the technology.

So they changed the product, not the idea.

Instead of asking you to replace your bed, Eight Sleep created a cover that goes on top of the mattress you already own and heats, cools, tracks and adapts to whoever is sleeping on it. That became the Pod.

We like to look at companies once they’re worth a billion dollars and reverse engineer this perfect story where the founders saw the future before everyone else. The reality here was so much messier. Eight Sleep went through five generations of the Pod (and just launched their 6th this week), re-engineering the temperature system, sensors and app over and over again, and Alex has publicly talked about multiple near-death moments where the company almost ran out of money.

The thesis that sleep could be improved with technology has never changed. What they were willing to change over and over again was how they delivered it and that’s a huge lesson.

They didn’t just change the product, they changed the category

Honestly, I think one of the smartest things Eight Sleep did had nothing to do with the hardware.

They started calling it Sleep Fitness.

That sounds like a branding decision but it’s not. Think about what happens to your willingness to spend when you change the category. A mattress is kind of like furniture. You buy one every 10 years, shop on some combination of comfort and price and then hope you don’t have to think about it again for a decade +. Fitness is something you actively work on and keep investing in.

We spend SO much money trying to optimize the sixteen hours we’re awake. Trainers, supplements, workout classes, skincare, healthy food, wearables. Yet we spend another eight hours asleep and for a very long time, the extent of our optimization was buying a mattress and maybe some blackout curtains.

Eight Sleep positioned those 8 hours as something you could actively improve, and found its early customers in people who already thought that way like founders, biohackers and elite athletes. F1 legend Charles Leclerc became an investor in 2025, and Eight Sleep says more than 70% of the F1 grid uses it.

And this distinction matters. Eight Sleep didn’t have to convince anyone that sleep mattered but they did have to convince them that sleep was something they could invest in improving.

When you’re selling a $2,500+ product for someone’s bed, that matters A LOT. The comparison is no longer another mattress or topper. You’re competing for the same wallet that is already paying for a wearable, a trainer, supplements, recovery and everything else someone believes will make them feel and perform better.

That completely changes the value question.

One billion hours changed the business

Eight Sleep has now analyzed more than one billion hours of sleep data.

When I saw that number, it changed how I thought about the entire business. The obvious asset is the Pod sitting under your sheets. But I think there’s a very real argument that the harder thing for anyone to recreate is what Eight Sleep has been collecting from beneath your sheets for more than a decade.

This is the question I ask myself constantly when I look at investments: what does a company own that becomes MORE valuable as it gets bigger?

An audience, distribution, and network can do that. And proprietary data can absolutely do that.

Every additional night tells Eight Sleep more about how people actually sleep, how temperature changes through the night, how different bodies respond and where there might be patterns nobody has had enough data to see before. They’ve gone from using technology to improve a mattress to owning a dataset that informs what they build next.

And one of the biggest gaps they found? Women. And honestly, that’s not surprising.

The research didn’t exist, so they did it themselves

Sleep science, like SO much medical research, was historically built around male bodies. Women weren’t even required to be included in NIH-funded clinical research until 1993. I was 1. And even after that, there were major gaps in research around sleep during pregnancy, postpartum, perimenopause and menopause (or the majority of a woman’s life).

Alex became a driving voice inside Eight Sleep for building around the biology of the actual person using the product, instead of the male thermal baseline so much of sleep science had studied.

And instead of waiting for someone else to do the research, Eight Sleep did it themselves.

In 2025, its Women’s Sleep Initiative studied 90 people, including 60 postmenopausal women and 30 similarly aged men. Across 1,485 nights, the team collected more than 10,700 hours of sleep data, 577,000 core body temperature measurements and 119,300 glucose measurements.

They measured everything from hormones and circadian rhythm to cognition, and participants literally swallowed ingestible capsules so researchers could track their core body temperature while they slept. Talk about a serious commitment.

And they found an average 56% reduction in nighttime hot flashes for women using the Pod.

What I love here is that this wasn’t Eight Sleep deciding women were a new demographic to market to and putting a female face in an ad. The research actually changed what they could build and we’ve also started to see this across other consumer categories as well.

Pregnancy Mode came from a separate dataset of more than 45,000 nights of pregnancy and postpartum sleep data and automatically adjusts the Pod’s temperature from early pregnancy through 24 weeks postpartum. By the third trimester, women were setting their Pods around 3°F cooler than before pregnancy, with some needing a lot more cooling than that.

I’ve seen versions of this problem firsthand from advising in the women’s sleep space, and I cannot stress this enough: women are not a niche market. There are entire categories where the research was built around men, and we’ve treated the problems women experience as “normal” because nobody spent the time, money or resources to understand them. (If you’ve been here for a while, you know exactly how I feel about women being told something is normal.)

So here’s the question I’d ask every founder reading this: what if your next market isn’t a new product at all, but a customer your industry never properly studied?

Eight Sleep didn’t have to stop serving F1 drivers, founders and biohackers to become relevant to a woman going through menopause or pregnancy. It took the same technology and figured out how different people needed it to work differently.

That’s how proprietary research becomes product development, and product development opens up an entirely new market.

And yes, I actually use it

I use my Eight Sleep every night and I genuinely love it. Courtney and I are pretty militant about our eight hours, but the thing I notice most is the temperature control. I sleep better cold, and being able to control my side of the bed on its own is one of those things I now cannot give up. Ask me how I know... 60 days on the road without it was a LOT.

It’s obviously an investment but if sleep is already a priority for you and you’ve been going back and forth on whether an Eight Sleep is worth the money, I think it is.

HSR Takeaway

So what can we learn? Eight Sleep started with the wrong product, got rejected by Y Combinator, nearly ran out of money more than once and spent over a decade iterating before becoming a $1.5 billion company.

And 12 years later, the team is still iterating and getting better. Earlier this week Eight Sleep launched Pod 6, its smallest and most powerful Pod yet and I need one. It is 50% more compact than the previous version, 20% faster and has more biometric sensors to track heart rate, HRV, respiratory rate and sleep stages without needing to wear anything else. They’ve also added Solo size and have a new entry price point of $1,999 which I think will go a long way for the consumer.

But the thing I’d actually take from this business isn’t to build the next Eight Sleep, it’s to look at your own industry and ask what everyone has simply stopped questioning.

What problem has existed for so long that consumers assume it can’t be fixed? What customer gets called “niche” because nobody has bothered to understand them? And what are you building up as your business grows that could one day be worth more than the product you set out to sell?

Eight Sleep started by asking why a mattress was still basically foam and 12 years later, they have built a $1.5 billion business.