Why entrepreneurs should dive into efficient markets, and what we can learn from waterbeds.


In 1968, at San Francisco State University, a student by the name of Charlie Hall was working on his thesis. Hall found himself filling a chair with Jell-O  and another with liquid cornstarch, all stepping stones to the water bed we know today. The goal was to focus on furniture  that formed to the contours of the users body, without creating pressure points. The water filled the gaps and curves as users moved, which in theory, would provide equal support to the entire body. Hall patented his design in 1971 and by the late 1980’s, the waterbed industry was sitting around $2 billion.

The Value of A Good Night’s Sleep

The global mattress market is a $27 billion industry, expected to almost double by 2024 according to Zion Market Research. Additionally, the sleep-health industry- bedding, sound control, temperature control, consultants, sleep aids- is estimated to be worth $30-40 billion. These numbers identify a stable and efficient market, one that targets something that affects everyone: a good night’s sleep. Whether we’re talking about waterbeds or the chiliPAD- a sleep system that regulates temperatures- what is most obvious is how much entrepreneurs stand to gain from entering markets that are stabilized and with clear value objectives.

Tired of Being Tired

Over a decade ago, Todd Youngblood, the nephew of waterbed inventor Charlie Hall, was exhausted. Both he, and his wife Tara, tired of being tired, decided to stop snoozing their entrepreneurial dreams and got to work designing a new way to sleep. Utilizing Tara’s art experience in science, they began to look for an answer that already existed, but were having a hard time finding an existing product that solved their sleep problems. Plenty of naps later, the chiliPAD was born, a hydro-powered mattress pad with thermal regulating cube(s) and an infrared remote that allows users to heat or cool their bed from 55-110°F.

Building Up A Stale Market

Since launching the chiliPAD in 2007, the Youngbloods have spent more than 10,000 hours studying the science of sleep. This industry, once stale and drowning in sameness, has exploded with options and opportunities to participate in the revival of quality, sound sleep. In the 60’s and 70’s when waterbeds were the most iconic and innovative option on the market, the goal was still the same: change the way people sleep.

Dis-Ease With Sleeping

According to the Centers for Disease Control and Prevention (CDC), more than one in three Americans does not get enough sleep. This is roughly the same number of Americans who are obese. Tying sleep, or a lack thereof, into dis-ease, disease, and other less obvious health ailments provides great insight into why the sleep-health industry is so massive. We all need sleep, we don’t feel well when we don’t get it, we often don’t know how  to sleep better, and it’s making some of us sick.

Disruption By Way of Efficiency

Markets ripe for disruption create massive opportunity gaps for entrepreneurs to come in and really focus on innovating and/or taking what is already there and making it better. In the case of the Youngbloods and their chiliPAD, they looked to several industries to figure out how they could make sleep more efficient. By combining multiple disciplines, including Alternative Medicine, Physics, and Sleep Diagnostics, they’ve been able to reimagine and reinvigorate  how we look at sleep and wellbeing. This makes one point very obvious: some markets in need of disruption are also lacking in connections, which could essentially relaunch that market into new and innovative territory.

Customization Is Always In

In the 1990’s, when brands like Tempur-Pedic and Sleep Number hit the market, customization was a big trend. People wanted something they believed was just for them, personal and custom. Today, we see less mass customization, but more bespoke brands taking off, proving that consumers- more than ever- are willing to pay for something that is specifically for them. The chiliPAD is representative of this mindset. A system that is absolutely custom to your exact sleep temperature, and that bespoke approach  is a massive selling point now more than ever before.

While waterbeds eventually developed a stigma around their weight, the effort to drain and fill, the sleep industry itself has experienced tremendous growth, year after year. This high revenue industry is open for exploration, innovation, and even more efficiency as our societies continue shifting towards well-being  at the center of how we eat, work, and sleep.

Read the original INC article published on August 13, 2019.

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