Why Most Internet Companies Fail Within 5 Years
June 13, 2018
Author: T&N Team
Every podcast you listen to, every ad on your Instagram feed, every interview in a magazine features someone “disrupting” an industry.
Cosmetics, website building, flowers—disrupted.
Toothbrushes, underwear, wine—yep, disrupted.
Groceries, vitamins, razors—you guessed it, disrupted.
Mattresses… if you haven’t been confronted with a fancy boxed mattress in the last year, have you even been on the Internet?
And you know every story now too—two buddies (from college!) experience some sort of slight from an incumbent that inspires them to do more than just be another voice in the crowd. They call around and figure out exactly what it costs to make a product and then charge only marginally more so customers can pay a fair price. They call it something catchy and make funny, entertaining content online to build their brand. They move into cool, airy office spaces and hire smart, driven young people to push ahead and keep “disrupting.” They all have quirky headshots and unlimited vacation policies, The snacks are incredible.
When you break it down, it sounds easy. Make a few phone calls, sign up for a simple e-commerce website, sell your stuff, make $$$. It is easy—at first. But every step that comes after registering for your domain has a thousand opportunities to fail. The incumbents are fighting against you with decades of knowledge and profits to keep you down, and the internal struggles of starting a company are just as tricky to navigate.
This is why most e-commerce companies will likely fail after 5 years—and hardly any of them will see a decade in business. These “disruptors” start with a pure mission—to do it better than the greedy companies that came before. There aren’t many that wouldn’t get on board with that, which is why they often skyrocket to a cult-like status before quietly fizzling out. But pure intentions aren’t enough to fight a war. People lose their passion and leave for safer projects. Investors start doubting your abilities and pull back on the reigns. Your vision starts to look less and less like your dream and more like someone else’s nightmare.
We know this story so well because we’ve lived it. So what the hell makes us believe that we’ll be the ones still here in 10 years?
A few things.
We’ve built ourselves to be more than a flash in the pan.
We didn’t raise a ton of cash before we launched, which means that everything we did at first was on our own terms. We were allowed to be counterintuitive, we were allowed to be a little reckless, and that got us noticed. Along the way, we found smarter folks who have set us up for success in the future, but the benefit of not having investors or a board right out of the gate was being bigger and bolder than other companies. That initial excitement gave us the foundation to scale our team into a healthy, functioning company that still has a scrappy, rebel heart. Every change to our product, every change to our organization, every change to our messaging, has been with longevity in mind.
More than that, we curated a team of people that certainly don’t mind the perks of a beautiful office and delicious snacks, but they love what they do and care about where we go.
We knew others would follow our lead. We knew they’d have more money to fall back on. We knew there would be a lot of noise to rise above. We knew that Big Mattress wasn’t going to love what we had to say.
We’ve structured our company to withstand them, the passing trends, and e-commerce was a launch pad for the beginning, not the end.
We offer an experience that no one else competes with—online or offline.
Our website is optimized to be easy, clear, and helpful. No sales team, no hoops to jump through, just read up on what you’re in the market for and push a few buttons.
And when you visit our stores? It’s definitely not going to be what you expect. We’re always working on new ways to make everything you need to know about our products easily accessible and pleasant to check out. Our retail team is trained to be helpful and to educate, we have no need to push for a sale. It’s refreshing and relaxing—the way shopping for sleep accessories should be.
That seamless order and delivery is the experience we hope for—but for some of our customers the true strength of our company becomes clear when we do mess up. Seriously. If you have no issues with your order, you’re missing out on an award-winning team that bends over backwards to do right by our customers. They work hard every single day to make sure that we’re treating people like people, not numbers. Even when people return our products they typically remain fans and willing to recommend us to a friend.
There’s a reason everyone else is starting to shape their websites and retail locations our way—and we welcome it. We’re not just changing the mattress industry, we’re changing how people do business.
We make better products, for a better price, and treat people like we want to be treated. Period.
Anyone can private label a product with a snappy name and sell it. We weren’t looking to make the same thing as everyone else, which is why we invented our own Tuft & Needle Adaptive® foam. When we saw that sheets were being marketed with hazy thread counts and persuading people into believing that if your cotton wasn’t Egyptian, it wasn’t worth anything, we found out why and made them better. When our customers asked for pillows, we didn’t just shove scrap foam into a case and call it a day. We specially formulated our foam to have the exact right bounce for perfect sleep, and we adjusted it over and over again until our customers and our team members were happy.
The proof is in how often our customers rave about us:
When our customers needed box foundations and frames, we curated the best products we could find. When one of them wasn’t up to our standards, we pulled it from our site, sent all of our customers better options, and are redesigning it to get rid of the flaws.
We’re honest, fast-thinking, and we want you to love what you buy from us. That’s it.