Shaper: Jas Bagniewski

Show aired on 9th September 2017

Transcript

Elliot Moss
That was Nancy Wilson with Call Me. A lovely way to start the programme. Good morning this is Jazz Shapers, I am Elliot Moss here on Jazz FM. Thank you very much for joining me. Jazz Shapers is the place where you can hear the very best of the people shaping the world of jazz, blues and soul and we bring just for you right alongside them someone who is shaping the world of business and we call them Business Shapers. I’m really pleased to say that we’ve got the CEO and Co-Founder of Eve Sleep that’s the wonderful mattresses that you get delivered to your house right here in front of me, Jas Bagniewski, I hope I said that properly he’ll correct me in a moment if I haven’t.

Jas Bagniewski
Nailed it.

Elliot Moss
Nailed it, fantastic in one. Jas is with me and he’s going to talk all about the trials and tribulations of creating a business from scratch and then floating on the AIM market very recently. Lots coming up from him. In addition to hearing from Jas you’ll be hearing from our programme partners at Mishcon de Reya some words of advice for your business and then we’ve got the music and its brilliant today. It includes Otis Redding, Sarah McKenzie and this from William Bell and Judy Clay.

That was William Bell and Judy Clay with Private Number and a classic it is too. Jas Bagniewski is my Business Shaper today, CEO and Co-Founder of Eve Sleep, they make the mattresses which if you don’t like you can send them back I think after a hundred days is that right?

Jas Bagniewski
Yeah we give people 100 nights to try it out at home you know in your own comfort and then if for any reason you don’t like the product we just come and pick it up, take it from your home and give you a full refund.

Elliot Moss
That’s a ridiculous idea Jas I mean – thank you very much for joining me I should say. Tell me why you thought you would take on the world of mattresses. A pretty established market.

Jas Bagniewski
Uh huh.

Elliot Moss
About four billions worth I believe something like that it’s a huge, huge market. There haven’t been many newcomers in this world and there certainly haven’t been many people saying you can get your money back if you don’t like it.

Jas Bagniewski
Uh huh.

Elliot Moss
So tell me about how you have come to it and why you?

Jas Bagniewski
Well it started about six years ago back in 2011. I had worked for a company called Groupon. I am one of the Founders of a company called City Deal which we sold to Groupon, it became Groupon International and one of my jobs there was running the products platform where we were selling products online and we were looking for high margin products that sort of fit the Groupon discount model and after the sale of City Deal to Groupon I left and I wanted to start my own business and with some friends of mine we sort of looked at the product category at Groupon and thought what products might fit that and we thought about products that first you could source locally and secondly that had high enough margins that would fit the discount model and we sort of stumbled across the idea of mattresses really and in 2011 we put a deal on Groupon, we didn’t have any mattresses at the time, we didn’t really have enough money to buy them either but we thought we would sell a couple of hundred maybe and sort of start boot strapping our own business and it became the biggest Groupon deal of all time. We sold six thousand on our first day, turning over two million dollars and then rolled it out to eighteen countries in about three months and turned over about thirty million bucks in the first three or four months of trading so it just sort of exploded really and from there we had a mattress business which pre-dated Eve, we ran that from 2011 to 2014 and then at the end of 2014 we decided to sort of focus much more on the brand and much less on pricing and discounting and the sort of commodity aspect of mattresses and build a sort of more premium and aspirational brand.

Elliot Moss
An incredibly precise way of going about it. I mean some people are passionate about football, some people are passionate about clothes or fashion or their perfumes or whatever it sounds like you were analytical.

Jas Bagniewski
We were I would say very opportunistic really we kind of always went into it quite agnostic in what we would do. We just felt you know if it makes money it makes sense and the thing with mattresses is they just, it just exploded for us really. So it was I would say more opportunistic than it was greatly strategic. We just saw the product worked and we figured out how to scale it and then we just pushed it as hard as we could.

Elliot Moss
Find out more from Jas Bagniewski my Business Shaper about how he is making it sound really easy building a business and then getting investment and floating it which is all that has happened in the short period of time. Time for some more music right now this is Otis Redding and Hard to Handle.

That was Hard to Handle from the one and only Otis Redding. Jas Bagniewski is my Business Shaper and he is the CEO and Co-Founder of Eve Mattresses and you were talking earlier in such simple terms, I love it when people do this they reduce the complex to something awfully straightforward and you just said well we found a category that would be a higher margin, that would be easily locally sourced and so on and we made it work. Your background, you’re a well-educated fellow, you went to university, you’ve done an MBA at Cambridge and all that. Do you think your education played a part in you being able to analyse something as you called it so agnostically as to look and you talked about opportunism as well you talked about that but is that a function of the consultant mind-set because I believe you were a consultant at one point as well.

Jas Bagniewski
I was but actually I think in terms of sort business my education actually came when I started working. After I left Accenture I went to work for three German brothers called the Samwer brothers they have an incubator called Rocket Internet, 25% of the billion pound companies in Europe are started by these brothers. They are companies like Zalando, Hello Fresh – amazing guys. When I went to them they employed about forty people and they had at the time built a few businesses in Germany and they were starting to internationalise their sort of portfolio and I came on as a Founder/CEO of a Polish price comparison site with them and later they did, I ran Zalando in the UK for them which is now the largest ecommerce company to come out of Europe and I also did a business for them called City Deal which we sold to Groupon so I think really working for those guys and because when I went there Rocket was a very small business, they had like forty people I think now it employs something like fifty thousand so I worked directly for the three brothers and I just got amazing exposure to them and how they thought about building businesses and scaling them and really everything that I apply now came from the sort of interaction with those guys. I think you know Westminster/Cambridge all that stuff gives you a good all round education but there’s nothing really sort of tangible that I would take from that that I would apply to what I do now.

Elliot Moss
Did your friends and people think it was a risk to go off and do that because it sounds like to me that say an unusual and unconventional route through but indeed the very platform that an entrepreneur like you needed I guess? Is that, was that fair at the time, people going what are you doing Jas?

Jas Bagniewski
Yeah a lot of people did I mean Accenture has a sort of great brand, it’s the sort of place that you go after Uni and its considered a really sort of top job you know and my parents are quite traditional, they’re Polish and so for them that was something they were incredibly proud of that I was working at Accenture and when I told them I was leaving to sort of join this sort of little rag tag bunch in Berlin they were really worried they thought I was crazy but in fairness the Samwers had already done some pretty amazing businesses. They had run Ebay in Europe after selling an Ebay competitor to them and they built and ran a company called Jamsters which they sold for three hundred million. They used to do the crazy frog ringtones, you might remember.

Elliot Moss
I remember. We won’t be playing that.

Jas Bagniewski
Ok fair enough.

Elliot Moss
Or any hip hop today.

Jas Bagniewski
Okay.

Elliot Moss
And I know that will be sad for you.

Jas Bagniewski
Well I’m still hoping we squeeze in Juicy by the notorious BIG. So yeah, so you know I guess it was a risk in other people’s eyes but for me I just sort of met them, I knew their sort of profile, I knew what they had done and I was also quite young I think I was maybe like twenty eight or something at the time it just felt like if it didn’t work out I would go back to you know maybe lose a couple of years, just going back to being a consultant or something. I had always kind of wanted to do my own business and it just felt to me that regardless this would be a way to sort of learn how to do that.

Elliot Moss
Stay with me for more and find out how Jas indeed has gone on and founded his own business and is doing really well. Latest travel in a couple of minutes and before that some words of wisdom from our programme partners at Mishcon de Reya for your business.

You’re listening to Jazz Shapers with me, Elliot Moss. Every Saturday I’m very lucky I get to meet someone who is shaping the world of business. If you’ve missed any of the two hundred and fifty plus editions of this programme go into iTunes put in the words ‘Jazz’ and ‘Shapers’ you’ll find some there. If you’re travelling with British Airways in the future that’s another destination for you as is CityAM.com. There’s a few programmes available over there as well. Jas Bagniewski is my Business Shaper today he’s the CEO and Co-Founder of Eve Sleep they’re a business now turning over I think at the last count, the first six months at least just over eleven million pounds of revenue but more importantly than that a market value, a market capital value right now of around of a hundred and thirty million pounds because they’re on the AIM market, not bad eh from a standing start a few years ago. Jas we’ve been talking about your background a little bit because I am sure people listening will go how did that happen? So there’s a guy who’s at Accenture then he ends up in Berlin, he’s working with these brothers who have invested loads of money, just give me a quick insight into how you landed there, how this well-educated kind of relatively conventional beginning became something far more interesting.

Jas Bagniewski
I was incredibly lucky because a very good friend of mine, my best friend actually who was doing an MBA at Stamford in the US and he went to a talk by Alex Samwer who was the youngest of the three brothers and Alex Samwer told him that at the time Rocket had primarily focused on incubating German start-ups and they were looking to internationalise and going into what he called emerging markets such as Turkey and Poland he referenced specifically. My friend said to him I’ve got this really good friend of mine who’s a Polish guy, he speaks English. He lives in the UK but Polish originally and works for Accenture would you be interested to meet him and he made the intro, I flew over to Berlin to meet Alex and then the other guys at Rocket and within about an hour they offered me the job of founding and running a business for them. So they invested about half a million Euros, I think the first three hundred thousand they then topped up with another two hundred thousand. They did all of our IT and they said to me you know it was a price comparison engine they said go out to Poland and sign all the biggest car insurance companies and get them on the platform and we did it you know we sort of went out, starting going door to door, turning up at insurance companies, knocking on doors, going to brokers through network and eventually we signed all of them and put them on this price comparison engine and it’s how I started my sort of career in the internet.

Elliot Moss
What do you think they saw in you at that point? What was it that they bought?

Jas Bagniewski
It was 2008 and what I found later, what someone told me at Rocket was they said that we are about to enter into one of the worst global recessions ever so somebody who is willing to walk away from a career in consultancy and do a start-up now is either crazy or really tenuous and to be honest I just didn’t even know that the recession was happening to be honest.

Elliot Moss
You’ve just blown it.

Jas Bagniewski
Yeah.

Elliot Moss
They thought you were a crazy genius.

Jas Bagniewski
Yeah I just thought kind of why not it sounded fun you know it would be a chance to travel around a bit and do this. I’d always wanted to start my own business and I just, to be honest I thought if I didn’t do it I’d regret it afterwards because I just didn’t think an opportunity like that would come along again you know.

Elliot Moss
Now without that schooling do you think that Eve would be where it is now?

Jas Bagniewski
Well I mean I didn’t think it would exist you know if it wasn’t for those guys because everything really that sort of began Eve snowballed from there you know my involvement with Groupon, the mattress business we did which spun out of Groupon. All of the kind of learnings you know I think would probably still be either I’d be working at Accenture or like you know having my own business would be like a shop or something you know or a bar. I don’t think I would have ever thought in the sort of terms and that those guys sort of instilled in me.

Elliot Moss
And in terms of finding the next Jas’s in the business do you look for people like you or is it intentionally you know I just need a serious finance person that’s a different gig or is there something about that spirit that you had in 2008 that you still want to find.

Jas Bagniewski
There are some roles which require a certain level of technical expertise so you look at developers, maybe some guys, designers, some of the marketing guys you know they need a specific skill set, the finance guys but primarily we look for young, smart guys who sort of think outside the box and who have the courage to take on challenges. We’ve got a young guy who started with us I think he was twenty two when he started he is twenty four now he come on as a, initially he was a German customer service agent on an internship and now he runs all international at Eve. He’s overseeing twelve countries you know all of our European roll outs and so we very much like to have a culture, a sort of a meritocratic culture, if somebody’s good enough we give them the responsibility and we see how they deal with it so absolutely we look for exactly that profile.

Elliot Moss
Stay with me for more from Jas Bagniewski my Business Shaper today. Time for some more music right now this is the delicate sound of Sarah McKenzie with One Jealous Moon.

One Jealous Moon from Sarah McKenzie. I’ve been talking to Jas Bagniewski, he is the CEO and Co-Founder of Eve Sleep, they are on the AIM market and as you heard earlier Jas just well left in 2008, took a risk and here we are almost ten years later and reaping the rewards. Along the way you’ve had some significant investments from some significant players, I think one’s called DN Capital, Octopus Ventures and of course Woodford and Neil Woodford has been on this programme in the past. What were they buying? I know now what they were buying with you, the German brothers were buying back in 2008. Different when people are putting in money at the levels they’re putting in and we’re talking millions of pounds. What are they now seeing in Jas and his team?

Jas Bagniewski
I think it’s sort of, it sort of e-success investors is a little bit different. At the beginning really all they were investing in was a team so DN and Octopus came in before we even had a website. We had just thought of the brand name Eve so they were very much buying into us. You know I was introduced to DN Capital by Mark Samwer so the oldest of those three brothers a few years before and he said you know when we were looking to invest in something else he said you know you should back this guy he’s really good, we’ll co-invest if you guys do we ended up not doing that business but when I went back to them with Eve they said yes pretty quickly because they had known us for a number of years. We had come with a sort of references from the Samwers, we’d built some big business before and we had had a background selling mattresses online and there was a sort of emergence of direct consumer mattress businesses starting to happen in the US a number of so the model in some sense was proven so all of that I think made it relatively, they got comfortable with it. You know at the beginning the investments were smaller, they put in about half a million quid between them and then after that they start backing the execution more you know we massively over delivered on what we had forecast so the series A round we did much quicker. They put in two and a half million between Octopus and DN and then the series B also we were growing so fast it was relatively painless and at that point DN Capital introduced us to a guy called Paul Pinder who was the, or who is the chairman of Purple Bricks which is now an AIM listed great success story business. But they had invested with Paul in Purple Bricks quite early, DN Capital and Paul and I guess they said to Paul, Paul said you know what else have you got or they said you should look at this business Eve that’s also quite interesting and between about February 2016 and the summer Paul sort of did his due diligence on us we met him a few times, he introduced us to a few people and then he decided to invest in the summer and one of the conditions was he felt we didn’t have enough funding for the plans that we were trying to do you know go international, roll out across Europe, roll out new products, build a brand so he sort of introduced us to Neil Woodford and then Woodford I think invested in us primarily because Paul said it’s a good idea and Paul put his own money in as well but also you know he met us as a team, he liked us a team, he liked us as a team and we had real traction by then. We were growing very fast so at that point people investing as much as in us in the metrics of the business as well.

Elliot Moss
You enjoy yourself by the looks of it. I mean your style is what? Is it as it seems now you’re pretty relaxed, you’ve got obviously a good intellectual hold on the business, you understand how to talk to investors or is there another side to you that you haven’t revealed yet? Because it seems like you take it all in your stride considering there is so much happening.

Jas Bagniewski
I’m relatively relaxed I mean I think we’ve been quite lucky in that the business has grown very well you know we’ve hired amazing people. We’ve got amazing investors so in some sense I’m relaxed because it’s going well you know obviously when we have periods where it doesn’t go well I get much more stressed but I really trust the people around me both the highs and investors and the advisers we have so that, I take a lot of comfort in that I think just being able to lean on a lot of really really good people.

Elliot Moss
Stay with me for my final chat with Jas plus we’ll be playing a track from Herbie Hancock, that’s after the latest traffic and travel here on Jazz FM.

That was Herbie Hanock with Cantaloupe Island. I’m with Jas Bagniewski just for a few more minutes and we’ve been talking about your journey and how its evolved from the risk tasking guy aged whatever you were, eight years ago, we already worked out twenty eight, something like that into this place now where you took a company public. Just tell me that feeling as you’re standing there, there’s a picture I’ve seen where there’s the whole team standing I think on one of, I’m not quite sure what it is one of the levels of the London Stock Exchange and your name, your business is now appearing right there. What did that feel like at that moment?

Jas Bagniewski
It was an amazing moment really they opened the stock exchange for us at 8.00am and so we had I think about eighty guests and primarily that was friends and family plus you know a few of the core team members and we showed up. The whole stock exchange had been Eve branded, all our buddies were there you know and we, I thought it was a bell, it’s not actually a bell but we pressed the button that launches the stock exchange for the day at 9.00am and then we gave speeches there and when we pressed the button which launches the stock exchange but also launches Eve onto the stock exchange there was like a countdown where they did ten to one, I mean the whole place was shaking as everyone sort of counted down. They said we were the most rowdy bunch they’d ever had. Which was obviously music to our ears and it was just incredible really, it just felt such a, a sort of validation and culmination of all the hard work that everyone had put in for, it’s only been two years I guess so me and my co…, we launched Eve two years ago me and my co-founders had been working on mattresses for six or seven years already and sort of you know thinking back to even before that had a few businesses that failed and kind of struggling doing stuff so it just felt like a very, just a very joyous thing you know there and seeing all those guys there who had built it together.

Elliot Moss
And now obviously there’s a bit of I imagine you come down off of that and you go okay well we’ve got to do the small things tomorrow just like we did yesterday we carry on. What are the plans in terms of shaping the business that you’re in and the category you’re in because you are disrupters? You look at the branding, you look at the language around the brand, you look at the promise I mean the fact that you can give back stuff after a hundred days is ridiculous as I said right at the beginning but it works for you. So where do you now go? What are the next three to five years hold?

Jas Bagniewski
Well I think the core thing really is becoming the leading European mattress brand. Today Eve is the second most searched mattress brand in the UK after Ikea which is pretty amazing you know more than Tempurs and Silentnights and all these Dreams you know all these guys everyone’s heard of. One of the most recognised brands, mattress brands in the UK and that’s on the back of just having a fantastic product you know incredibly comfortable and allowing people we’re so confident that we allow them a hundred nights to try it out and we’ve spent years developing it but then from there really the other parts are internationalising so we’re in fifteen countries now. Rolling out new products so we have a bed launching soon, we’ve got pillows, sheets, duvets you know really trying to own the category of sleep which I think, there’s no go to place for sleep you know. So I think that’s a really interesting challenge and then the other part a guy called Jonathan Zatland that our company is leading is the pushout into retail stores so we’re partnering up with stores such as Fenwicks, Debenhams, Next you know other retail partners in Europe and rolling out the product actually into physical locations beyond what we’ve been doing online direct to consumer.

Elliot Moss
So nothing ambitious at all, internationalisation and taking over the retail market. Fabulous stuff. Listen Jas I wish you all the best because you sound like you know what you’re up to and you don’t look too stressed.

Jas Bagniewski
Thank you.

Elliot Moss
Which is the best part, you look like you might be enjoying it. Just before I let you go what’s your song choice, unfortunately I know it can’t be hip hop we apologise but this is the jazz, soul and blues home. What’s your song choice and why have you chosen it?

Jas Bagniewski
Please could we have Smokestack Lighting by Howlin’ Wolf?

Elliot Moss
Say please again I just love that he’s begging now.

Jas Bagniewski
And the reason I chose that, I don’t know I just think it’s a great song really. I love a film called Cadillac Records I don’t know if you’ve seen it there’s an amazing sequence where Howlin Wolf sings it to Molly Waters his wife and I always just thought he was a pretty cool guy.

Elliot Moss
Here it is just for you, thanks a lot.

That was Howlin’ Wolf with Smokestack Lighting the song choice of my Business Shaper today Jas Bagniewski. Someone who took a chance at a young age and that’s absolutely critical if you’re going to be an entrepreneur, someone who when choosing the business that he wanted to go into was agnostic if it makes money it makes sense he said and someone whose relaxed manner I think belies the fact that underneath all of this is super hard work and lots of focus about what he and his business want to achieve, really good stuff. Do join me again same time same place 9.00am sharp for another edition of Jazz Shapers right here on Jazz FM. Meanwhile stay with us because coming up next its Nigel Williams.

Jas Bagniewski

Jas attended Westminster School before going to the University of Manchester. Following this, he studied an MSc in International Relations at UCL, and an MBA at the University of Cambridge.

In 2005, Jas worked as a teacher at Manasarovar Academy in Nepal, where he taught English and Maths to Tibetan refugee children. He subsequently worked as a consultant at Accenture, focusing on the Financial Services and Utilities industries, and was a member of the senior management team at Rocket Internet, a Berlin-based incubator, where he launched price comparison websites PlaceMniej.pl and CityDeal UK. He became Country Head at online fashion company Zalando UK in 2008 before co-founding of Zen Bedrooms, a memory foam mattress business.

Jas founded eve Sleep in 2014.

Listen live at 9am Saturday.

We sort of stumbled across the idea of mattresses really…

We decided to focus much more on the brand and much less on pricing and discounting and the commodity aspect of mattresses and build a more premium and aspirational brand.

It was more opportunistic than it was greatly strategic. We just saw the product work and we figured out how to scale it and then we just pushed it as hard as we could.

I think Westminster and Cambridge… all that stuff gives you a good all round education but there’s nothing really tangible that I would take from that that I would apply to what I do now.

My parents are quite traditional… they were incredibly proud that I was working at Accenture and when I told them I was leaving to join this little rag tag bunch in Berlin they were really worried. They thought I was crazy.

I flew over to Berlin to meet Alex and the other guys at Rocket and within about an hour they offered me the job of founding and running a business for them.

Somebody who is willing to walk away from a career in consultancy and do a start-up now is either crazy or really tenuous, and to be honest I just didn’t even know that the recession was happening.

We very much like to have a culture, a sort of meritocratic culture. If somebody’s good enough we give them the responsibility and we see how they deal with it.

Obviously when we have periods where it doesn’t go well I get much more stressed but I really trust the people around me…I take a lot of comfort in just being able to lean on a lot of really, really good people.