Ep. 050: On Launching an Innovative Bedding Company — The Eugene Alletto Interview

Hear the spectacular entrepreneur journey of Eugene Alletto, the Founder of Bedgear, a performance bedding company. Learn how overcoming the loss of his father as a teenager, in large part, drove him to eventually succeed as an innovator and business owner. Listen as he shares his wisdom on the topics of perseverance, resilience and utilizing your strengths to overcome life’s obstacles.

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Top Takeaways From This Episode:

(1)  You can teach yourself to not be a victim of your circumstances. Successful entrepreneurs have a key trait of not taking on a victim mentality.

(2)  “Being an entrepreneur is not something that you can say you are. Being an entrepreneur is something you become. I had no idea. I wasn’t born to be an entrepreneur.”

(3)  “Part of being an entrepreneur is learning every day. And if you’re not learning, you’re not growing personally. And if you’re not growing personally, you can’t grow professionally.”

(4)   If you aim your mind towards things that you’re passionate about, you can become a great learner. And learning can deliver you success.

Transcript:

John Benzick: This episode of Product Launch Rebel features Eugene Alletto, the founder of Bed Gear. I walked away from the interview feeling inspired by a guy who became really transformed by entrepreneurship and by following his vision of a better bedding company. This is a guy who had lost one of his parents at a very young age and at face value, didn’t have anything special to offer; not being particularly good at schoolwork, not being a great athlete, having bad skin, a bad haircut, and as he describes — lacking confidence as a young man — not being one of those “chosen ones” within his peer group. But as you will hear in this episode, you’ll see how starting a business built his confidence in not just his career, but other areas of life. A value packed episode is in store for you as you hear an entrepreneur’s story about persistence, pursuing what you’re good at and passionate about, and learning that you’re capable, and not a victim, of your poor circumstances.

Eugene Alletto: Just the ability to just move on and not not get pissed off at what you’re not good at, or not get pissed off at circumstances, or not get angry when someone says no to you and blame it on somebody else is really, I think from an entrepreneur’s perspective, the people I meet that start businesses and are successful entrepreneurs and are happy are ones that are not victims and it’s really an lesson — and I think it’s something you can even teach yourself.

John Benzick: Greetings, Product Launch Rebels and welcome to the Product Launch Rebel podcast brought to you by VentureSuperfly.com where we help double your entrepreneurial courage, even if you don’t know what you’re doing. Please visit the Venture Superfly website and check out the contact page to join our mailing list. Today I’m excited to interview Eugene Alletto. He’s the founder and CEO of a super cool bedding product company called Bed Gear. I met him at the massive Las Vegas Market furniture trade show and I was blown away by the smart products his company is offering, which includes some really high tech mattresses, pillows and sleep related products. In fact, as I was walking through Bed Gear’s showroom, I thought that if Nike got involved in the bedding industry, this is the type of stuff they’d be doing, Bed Gear has done a great job of applying the concept of performance to bedding, applying things like their Air Tex, Dry Tech and Vertex technologies. To learn more about Eugene’s company, visit BedGear.com. Hey Eugene, thanks for being here and welcome to the Product Launch Rebel podcast.

Eugene Alletto: My pleasure and look forward to spending the rest of the next 30 or so minutes with you.

John Benzick: Oh man, it’s going to be great. So Eugene, within this podcast there are three segments. The first is called give me the basics, which helps set the context about your company for our listeners. The second part is let’s get personal or we get into some of the more personal topics about what it’s like to start a business. And the final part is what I call tell me how where we’ll get to the heart of the matter on issues that aspiring entrepreneurs want to know now to help them move forward. Eugene, what do you think? Are you ready for some questions?

Eugene Alletto: I am.

How Bed Gear Started

John Benzick: All right, fantastic. Here we go. Eugene, tell us the story. How did you originally come up with the idea to start Bed Gear.

Eugene Alletto: The Bed Gear idea really morphed over time, both the name and the product assortment. The part that really is interesting is like you’ll hear in most entrepreneur stories. Solving a problem is typically what what we see as entrepreneurs. And that’s where this becomes interesting. We had a son who was suffering from allergies. He’s now 20 and this was when he was around six, seven years old. And we were told by the doctor to go to the surgical supplies store, which probably don’t exist today because of the Internet, and pick up a vinyl mattress protector to encase the mattress so that we could eliminate the dust mites from his room. While we were successful in eliminating the dust mites, however, when he would wake up, we would notice that he was waking up in a pool of sweat cause you can imagine sleeping on a piece of vinyl with our body temperature being at the level that they are, you’re going to wind up taking that heat and transferring it into moisture.

Eugene Alletto: So he really had a tremendous amount of restless sleep. Even though we solved one problem, we created another. And looking around an industry that I’m aware of because of my background, I’ve been in home furnishings for many years. I realized that there was nothing being manufactured that would be breathable, yet still secure the need for reducing allergens in your bedding. And that’s really where the idea came from. It was a far cry from what it is today in terms of what we’ve discovered along this journey. However, that was the solution and the problem solving that we were looking to accomplishment when we first started with our very first product, which was a mattress protector.

How Bed Gear Differentiated Itself from Other Products

John Benzick: Eugene, the bedding industry is so competitive. And so tell me, what’s unique about Bed Gear and how did you cut through the clutter among so many bedding products in those early days?

Eugene Alletto: Very, very difficult. In fact, the frustration for me, and I’m sure for many entrepreneurs, is just how do you get that traction? How do you get the white space or the opportunity is really the easy part. The hardest part is actually getting people to believe in your vision and see that there’s a need for this product or an idea that you may have. So what I innately did based off of my journey I’ve been on is I realized that you needed to go talk to somebody that could actually sell your idea in volume. And so I had gone to a company called Sleepy’s, which was a large bedding manufacturer retailer in the northeast. They had at the time, they had a couple of hundred stores and they did lots of business. And I was able to work directly with ownership and management there.

Eugene Alletto: Both our companies were based on Long Island, New York, and I shared with them the story. I explained to them the value that this would bring to consumers. And I was able to get the product on the floor. And within a very short period of time of going to the stores and sharing that story, even with the sales associates on the floor, we were able to get some really good sell through. And I’ll tell you just to add a little piece of what you talk about in terms of clutter. What really made us unique and different was the value proposition wasn’t just the fact that we were able to have moisture wicking airflow and still maintain if you have allergies. Not Everybody has allergies. So the product became wildly successful because it was something that was health and wellness related to the customer.

Eugene Alletto: The clutter that you speak about is that the category that we started in was filled with many, many people that were manufacturing products to protect the mattress. However, most people don’t even want to spend money on a mattress. The last thing they want to do is spend money protecting it. So we didn’t know this, but what we found throughout the next several years is what built our company and brand promise was that we focused more on what’s going to be good for you as a consumer, not what’s good for mattress. And most of, even to this day, most people that sell mattress protectors are there to protect the mattress. And what we build is a product that protects you but also helps you get better night and healthy nights sleeps. So it really was the sales process as much as it was the, the product itself.

John Benzick: How many retailer doors do you sell to now and what types of retailers do you sell to?

Eugene Alletto: So we’re currently in over 450 furniture and bedding retailers. The other big decision we made was how to distribute this product. We recognized it was really important to have a store that’s got what’s called self-guided. So going into a mass merchant where there are no salespeople, there’s no sales support, you have to navigate yourself. We chose to go to a place where consumers go to buy their mattresses and at that time have a product that would be presented to you by a professional salesperson explaining the benefits and features. And it really is what propelled us to where we now have brand awareness with, with professional athletes, to doctors, to bus drivers to firemen and policemen. So we’ve become a brand, not because of going to the mass merchants and hoping that the consumer finds it.

Eugene Alletto: It was really more of a recommendation while you were purchasing a new mattress through your sales associate. So stores like a Raymour and Flanigan or Hom Furniture in Minnesota or The Brick in Canada. And now the beauty of it is we’re a global brand, we’re in multiple countries doing the same thing that we’ve done here in America. We’re in Russia, we’re in China, we just launched in Thailand. The beauty of it is as we get more into this interview, we are no longer a one product company. We are an entire assortment of products that all support the same brand promise. So we’re actually having stores being built. We have both freestanding stores in countries I just mentioned. However, here in America we now have in store galleries. So you can walk into like Nebraska Furniture Mart in Dallas or Kansas City or Omaha, Nebraska, and you’ll see a destination, a small version of what you had seen when you came into the Las Vegas showroom.

Eugene Alletto: We’re in Art Van furniture. There is a hundred of those stores in the midwest or Raymour and Flanigan’s in the northeast. And so what’s interesting is what helped America start to do these types of stores, these stores within a store concept, these popups as as they’re called today, is actually our international business. When the international buyers and owners came into our showroom and they saw this incredible brand of performance around the bedding category, they said, we want this, and I thought they wanted our product, but they said, no, we want the brand. This is an iconic American brand and we want to put these in an independent stores associated with our brands throughout the country, so we’ll have over 350 stores in China within the next three years. We’re already up to 35 and only a few months, 16 in Thailand we’ll have over 300 stores in Russia. We already have I think it’s 72 to date when the American companies saw what was happening with our brand globally. That’s what finally helped me to develop this in store experience that would really differentiate both our product as well as the retailer. So it’s an amazing journey.

Progressing from Few Employees to Many

John Benzick: Eugene, just to give our listeners some perspective, how many employees did you have originally when you started your company, maybe in that first year, and how many employees do you have now?

Eugene Alletto: There was me and I shared employees from some of the other small businesses that I had started in home furnishings. And so it was, it went to two and then it had a four shared employees. And then we are now 240 employees. We have a factory in South Carolina, over 300,000 square feet of factory and warehousing. Now we have an office for our creative suite here in the New York area. We have a warehouse in California and we just opened up our very first international manufacturing facility, outside of Shanghai to support all of our international growth. And what’s really, really awesome is the amount of American jobs that we’ve created. However, we also have taken the American ingenuity to open up the factory to duplicate the factory in China is identical to the factory that’s in South Carolina. And we share best practices and have really become more global citizens because of Bed Gear.

Working With International Distributors

John Benzick: So internationally, do you work with distributors or do you go directly to the retailers in those countries?

Eugene Alletto: So we start, and I highly recommend this, it’s really hard to sell a distributor and understand what they’re doing or not doing for your, your idea or your brand or your product. So I literally just got on an airplane and went and visited retailers where my product would be sold and determine what the value proposition would be. Determining where the right fit would be for us before determining how best to distribute the product. It’s always really important to know how your product is going to be sort of reviewed and expanded and understood what the, what the adjacencies are. And what I mean by adjacencies is, if your product is on the shelf, what’s to the left and the right of it so you can determine how best your products need to be priced and how they need to look.

Eugene Alletto: Because a lot of times distributors of products, they do it at a defense and they’ll tie you up in these countries. However, if you understand them, the value that you bring to the country and start working with the retailers first, then you create the direction that’s best for your brand and your product. And I think one, one of the things I think would be really helpful, John, is we talked about what was it that started the business, what was the product that got me started? And I think to give the listeners a little bit more context as to, what exactly we do is really important at this point because we’re getting into so many, so many sort of growth initiatives that we’re talking about, it’s hard to understand that.

Eugene Alletto: I think if it’s just purely what, you know, what we talk about in terms of a mattress protector. So would it be okay if I just gave a little bit of an overview of what you saw in Vegas in terms of product specific?

John Benzick: Yes, of course. That would be great.

Studying Consumer Behavior

Eugene Alletto: Awesome. So after we got started with this protector and we started to see that health and wellness and the customers reacted really well to products that were gonna benefit them, we started to get into this category of where people buy mattresses and we saw a huge, huge gaping hole. So even though it was a very small step, it gave, it gave us the opportunity to kind of get your head around like, oh my God, how come nobody thought of that? And here’s the big Aha moment. Well now that we’re in, we’re embedding stores and furniture stores and we see people laying on their backs with their legs crossed and their heads on these giant fluffy velveteen pillows that were supplied by the bedding manufacturers, recognizing that there was no process to buy mattresses.

Eugene Alletto: People just jumping from one bed to the next, over and over again on their backs. And what we started to see and when talking to the salespeople, it was really about price and comfort and it was very hard for people to navigate this sort of assortment of 50 to 75 mattresses that all essentially are white rectangles. With that in mind, we know that when people leave the bedding store, they were given like free pillows. Well, when I looked at the pillow, I realized, wait a minute, some of these not only are the pillows garbage and you know, seven, $8 Walmart like pillows. However, the pillow is an important piece too. I know how I sleep and I wouldn’t want to just have some random average pillow when I’m going to spend a thousand or 2000 or $500 on a mattress because the pillow is an intricate part to the overall sleep and comfort.

Eugene Alletto: And we’ve started to recognize that customers would get the free pillow. Maybe they use it, maybe they don’t. And it was really them going to a store. We’d go to a big box retailer and we would watch the customers navigate the pillow assortment and they would walk up and down the aisles and look for sort of what may be a sign, like pick me, pick me, I’m the right pillow for you standing up. It’s completely barbaric. You would never buy any other gear where they were disjointed. You would never buy a pair of shoes or, or a bra or a pair of jeans that don’t fit you and expect you to either look good or feel good. And that’s when we went back to our distribution at Sleepy’s in New York and we said, hey, we got another idea. We have this process that we would love to try and test in one of your stores.

Eugene Alletto: And they allowed me to test the following sales process and process became more in some ways more important in the beginning stages of our business on how to actually display and sell our products as opposed to just building a product. Our products back then were nothing compared to what we have today. Our products back then were all based off of purely sales presentation. And what we came up with is fitting you for a pillow. So we completed all of the major brands on the floor. We became, and still are to this day, the largest manufacturer and brand of, of supported size program for pillows. So when you walk into a bedding department today, they will personally and professionally fit you for a pillow with your mattress. It’s the only chance you as a consumer have to actually get 100% of your comfort and your support because buying a pillow, standing up and buying a mattress on your back when you’re a side or stomach sleeper makes no sense.

Eugene Alletto: And that’s what helped us really propel the business is because we became a complete performance sleep system. And so the mattress represents 70% of your overall spine alignment. And how we achieve that number is you, if you count your vertebrae from the top of your shoulders to the top of your cranium, one third of that vertebrae never touches your mattress. It touches your pillow. And so we now manufacture for Bed Gear. We manufacture pillows, sheets, blankets, mattresses and and mattress protectors. The mattress protectors still represent a very large portion of our business because everybody needs one. However, it is insignificant in terms of what the overall sleep solution has become for the company. And now the last piece is the mattress. We just came out with mattresses, which we don’t call mattresses. We called them launch pads because everything in your day, everything that that you do after you sleep, you’re launched from this performance sleep system.

Eugene Alletto: So once we started to do so much business with fitting people for pillows and sheets and protectors that were appropriate for for you, we saw another gaping hole, which was the mattress industry is completely upside down. You’ve got people throwing stuff in boxes, shipping it to customers. Customers don’t feel that they’re the right mattress, high return rate on all these mattresses in a box we hear up to 30% of of the of the brands are getting these things back. Those things are going into landfills. There’s only so many homeless people you can give and donate mattresses to, which is what they started. Now there’s so many coming back that nobody knows what to do with all this foam that they’re pouring it. So it’s destroying the earth, the regular conventional mattress stores nobody wants to go to because it’s so confusing and the product isn’t all that appealing.

Eugene Alletto: So we came out and we built an entire new mattress program called the launchpad, which allows you to have individual comfort. So it’s like driver, passenger, you can adjust your side. However, it’s all based off of modularity. So if you don’t have you have a product in your home, it doesn’t work. You could literally get a component as opposed to throw in the whole thing into, into a into a landfill. So it’s a whole, a whole ecosystem that we started. But the reason I’m getting so sort of excited to share this story is it all started with one stupid little, what I call a wee wee pad. Just a little mattress protector is all to have now a global brand. So don’t ever think that the one good idea that you have is good enough because the one good idea you have has to constantly keep evolving. Evolving and you have, if you’re a true entrepreneur, preneur at heart, you need to see the world is white space. Nothing can stop you. And that’s where y Bed Gear now has a brand of product and a brand promise that’s, that’s all ever reaching. So hopefully that gives you a little bit of context as to as to what John saw in Las Vegas. He didn’t come into a space and see one product. He came in and saw a 7,000 square feet of just the most awesome performance sleep products.

How Prepared Was Eugene When He Started His Business?

John Benzick: So Eugene, let’s get personal on a few topics. Many aspiring entrepreneurs don’t know what they don’t know before starting a business. They’re sort of unconsciously incompetent in certain areas, not as fully prepared as they should be or they could be in starting a business. And before you started Bed Gear, to what extent were your previous career skills and knowledge aligned with your task of launching Bed Gear? Let’s say, on a scale of one to 10, 10 being very aligned, how did your previous skills and knowledge fit with your new startup?

Eugene Alletto: So the, the number 10 being the best. And I’ll give you the three of my, my strongest number tens sales, sales and marketing. From there I dropped to probably a three on everything else and the, and here, here’s why I’m so being so dramatic. Being an entrepreneur is not something that you can say you are. Being an entrepreneur is something you just become. I had no idea. I wasn’t born to be an entrepreneur, you know? Yes. People said, Oh, you know, you’re a great sales guy. You’re a great sales guy. And I’ve been a sales guy my whole life. I’m still the number one sales guy. And guess what, everybody on this podcast is a sales guy. And why do I say that? Because if you have kids or a wife or a friend, everything you do, you gotta be able to sell your idea.

Eugene Alletto: So if you’re a sales person and really good at convincing people to, to follow your vision, then when it comes to your skill set, you’re going to know that innately. Right? So here’s what, here’s what I try to help I, and I get an opportunity to, to share sort of this idea. As I go around to two colleges and, and because everybody wants to be an entrepreneur, you know, since the millennial boom, everybody wants to run their own business. You have to know what you’re good at. If you are H or just a crappy salesperson, go become an entrepreneur. If something that you got to really sell a lot of to be successful. If you’re more techie, if you’re more of an accountant mindset, if you’re more of a, of a, of a, of a mindset that is to be more engineering, then you need to know that the rest of you is, is not complete.

Eugene Alletto: Because if you, if you’re an engineer of a product and you know the product has to sell well, then the very first thing you need to do is make sure you have somebody that can help and be passionate about your idea. So you may not know what you don’t know, which is what allows entrepreneurs to kind of blindly figure out this journey that they’re on. Cause if I knew how hard it was going to be, it would have probably have never put me in a position to be an entrepreneur. So being ignorant is like really important and something to embrace your level of ignorance. Don’t, don’t run away from it, you know, don’t let it, don’t, don’t let anything stop you. But most importantly is what you can can do very quickly is you can determine what you don’t know by two things. One, if you’re not passionate about getting in front of people and pushing your idea and generating sales, if that doesn’t make you passionate, even when it’s your own idea, then you know you suck at selling.

Eugene Alletto: And what if you can’t sell something? You can’t make something right? So you have to be able to sell your idea, unless it’s, unless it’s a service or something that’s unique in different that that you can go and get somebody else to partner with to help you sell the idea. So you really want to look at what you’re passionate about because that’s where you’re going to spend your time and effort. And when you’re an entrepreneur, it is a life’s journey. And if you don’t like what you do every day, you can’t be passionate about it. And if you’re not passionate, you’re not going to want to do it every day. So entrepreneurship, I think the key here, and to answer your question in, in a direct but indirect way, to kind of keep the, the creativity around it is you do know what you, what you don’t like because you’re avoiding those things every day, right?

Eugene Alletto: So you have to be more conscious of the things that you don’t like and the things that you’re not passionate about because those will be the areas that you’re not good at for the most part. So long. The along that journey is you need to collect people around you so that you can, you can leverage the thing that you’re not good at and give those things off immediately to people to help you see your, your vision through Eugene. What do you think is the number one lesson that you’ve learned since starting your company? This will come across maybe arrogant or cocky. However, I truly, truly have discovered this, not in the beginning, but only in the last probably 18 to 24 months of best. Even though it’s been a 20 plus year journey I’ve been on in entrepreneurship. You cannot let people tell you what to do.

Using Customer Conversations as Learning Tools

Eugene Alletto: You have to listen and you have to allow it to get, you have to be able to use the conversations as, as learning tools. You have to help them help that ideas to evolve your idea. But if it’s, if you have a really, really good idea and a really good vision, you cannot let people derail you because everybody that’s got your, that you’re trying to sell or you’re trying to convince, they’re all going to tell you, Nah, it doesn’t work. Ah, this or ah, that. And by the time you’re done, the idea that you had is so watered down that you don’t get the traction with the consumer. If you’re really gonna do consumer products, you have to know better than the consumer. When when you see value in products and services it is, and you see this, the growth that you see in the world today of, of entrepreneurs and starting a business there be, it’s there because you have an idea of something nobody came up with. That’s what the uniqueness’s about it. And it’s, if, you know, innately, if you have this gut feeling, you got to fight to the death to make sure that doesn’t get watered down too early because then it becomes nothing else.

John Benzick: Eugene, many entrepreneurs, including very successful ones, have regrets in doing things incorrectly early in their entrepreneurial journey. And I think those regrets can reveal super valuable lessons to aspiring entrepreneurs. Since you started Bed Gear, would you have approached the business differently if you could go back and do it over again?

Stepping Stones to Growth

Eugene Alletto: On a personal level, no. Now that’s only after 20 plus years of all the mistakes I’ve made, I feel that if I had done it differently, life would’ve been probably a lot more boring and probably not as successful. So I don’t have any regrets in regards to the, the personal side of the mistakes that I’ve made on the business side. I wouldn’t call them regrets. I’d call them stepping stones because I don’t, I don’t know if I would’ve been as successful if I had, if I had done it a better way. Because part of being an entrepreneur is learning every day. And if you’re not learning, you’re not growing personally. And if you’re not growing personally, you can’t grow professionally. So I can’t really call them regrets. I have to call them stepping stones and, and looking back, I’ll tell you that the single biggest stepping stone and barrier of of entry to, to scaling an idea to, to making it big in terms of volume and, and successful brand identity is not hiring far enough in front of where you’re going.

Eugene Alletto: And so where are my biggest problems are today and where were they were the last few years is that by the time I hired somebody or opened up a new department in our company, within a few months of that hire, they were already treading water because they only knew what they knew. And it was what I needed at the moment. And not knowing strategy-wise where it was going. Like for instance, we’re global, I didn’t build Bed Gear to be global. Now we’re global. So we score, we scrambled for for a year to even know what that meant. We never hired the right people that even had global experience operationally or sales or even accounting wise. Yeah. So now I have to go and Redo everything and hire new people where it would have been a lot easier. Said we’re going global. That’s the strategy. Okay, well we don’t know a lot of stuff.

Eugene Alletto: Let’s go, let’s go find that actually know something. And the challenge is, is truly that. So it’s that stepping stone of not hiring the right people for where you’re going. And it really starts back with me not having a big enough strategy mind cause I’m very entrepreneurial. So entrepreneurs are more reactive than proactive, right? We’re reacting to two moments in time right here, right now. And so I would, I would say that if, if, if anybody that is interested be very, very conscious of your idea and what you think you would need in the next couple of years and be a little bit bold on the areas that you have less expertise in and higher further in front of you than just what you need. This immediate moment right here, right now.

Motivations to Become An Entrepreneur

John Benzick: Eugene, it seems that nine out of 10 people just talk about starting a business, but they never start one. Starting a business as special as you know, and pretty unusual; what motivates a person like you, Eugene, Alletto, to stop just talking about launching a business and to actually go out and start a bedding company.

Eugene Alletto: So I think I’ll take this in two phases because I’d love nothing more than to, to help people not feel like it’s that, that they’re, you know, they’re losers because they haven’t started a business. You know, my situation was, is quite common for people that start businesses. And that is, I had nothing. I lost a parent at a young age. I was raised by a really, really strong mom who, you know, raised us to not be victims and just kind of keep going. So I think one is, you have to look at who, who has been successful in building companies. It’s typically there’s a very low risk of entry, both financially and time wise. So first and foremost, it’s, it’s sort of you gotta be aware of your situation. Now if, if you, if you weren’t pushed to, to go out and work at a young age cause you had to if you, if, if you, if you think about the following ways to do this, if you take the risk out of starting a business, more people would, would start a business.

Eugene Alletto: And the risk I talked about is how do you pay through your, how do you pay for your life? So the best advice is, and never to do this to where you’re hurting the employer that you’re currently working for. But there’s absolutely no reason why you can’t have what’s called the day job and start to put together money. You know, as much as you can just, you know, in a bank, stop spending your money on cars and expensive whatevers and really live at a, at a, at a fraction of your, of your, of what you need to spend. And then on top of that, make sure that you’re still got a job, that you can take your idea and start small and start to test. And you’ll see that all of a sudden when you take the risk off the table, you become even much more creative and more entrepreneurial.

Eugene Alletto: Because what holds us back most of the time is that we already have a job. We already have a life that we’re paying for. And that pivot into owning a businesses, really inexpensive barrier of entry. So my suggestion in this question is what can you do to reduce your risk of being able to survive financially so that you too don’t feel like you’re just that nine out of 10 sort of a percentage and you can increase that by just reducing your overall risk and starting small. Eugene, do you feel you had something to prove? You know, I, I feel like I, I’m that person today. I always feel like I have something to prove. It starts off trying to prove yourself to either your peers or your family. And when you really know you’re happy and successful in life, not financially but, but happy meaning the successful part, you start trying to prove things to yourself.

Struggling at School in the Early Years

Eugene Alletto: You know, I was always somebody who struggled in school at a young age. I was always somebody that wasn’t fast enough to make certain teams. I was too heavy as a kid. I had bad skin. You know, my parents made it worse by giving me a bowl haircut. I had the worst haircuts ever. And I think you’re right. I think there is this level of like, you know something at you, you carry this, I’m going to, I’m going to be successful someday with you. And I’ll tell you that the turning point, and I don’t know this when I’m this age, but I know at the age I’m at now, you know, losing a parent and having, you know, being the oldest at 15 and,nand the oldest of four and the way my mom raised us, you know, my mom went back to work.

Eugene Alletto: She was a nurse. She never, never once complained about losing her husband and our dad and just, you know, next couple of weeks after his passing, you know, we were, we were raised, just get on with it. You know, it’s, we were, we’re all said to this day that, that he passed. But it wasn’t, it wasn’t a victim mentality. And I can honestly tell you, I think that the ability to just move on and not, not get pissed off at what, what you’re not good at or not get pissed off at circumstances or not get angry when someone says no to you. And blame it on somebody else is really, I think from an entrepreneur’s perspective, the people I meet that start businesses and are successful entrepreneurs and are happy are ones that are not victims. And it’s, it’s really an important, it’s an important lesson and I think it’s something you can even teach yourself.

John Benzick: Eugene, did your success surprise you?

Eugene Alletto: If you’re not like surprised and delighted every day of what you accomplished during that day, then you can’t be passionate and happy and, and excited for the next day. If you just if you’re just happy and assume that everything is, you know, is you and you’re just great and you don’t, you don’t celebrate your level of, of, of wow moments and be surprised and delighted. Life would be so boring. I don’t know how successful my day will be today. I don’t know if it’ll be a 10 or, or a one, but the mere fact that I have the opportunity to, to define what my day will be like is everything to me. I don’t wake up with I have certain set things I do every day, but I don’t measure my success and say I’m okay.

Happier Than Ever

Eugene Alletto: I’m happy, I’m here. I really do look at life. And it’s not something that I could have said 20 years ago when I started this journey. But I truly feel I have, I have never been happier the last 10 years of my life because of Bed Gear. Bed Gear has been such an overwhelming defining sort of brand slash company that has really made, made me such a happy person. And I can honestly tell you that it’s the surprise and delight that it brings every day now. And it doesn’t mean that there’s, there’s not, you know, bad things that happen in terms of not what you expect. However, it’s what defines my day, right? So every time there’s a problem, you know, I take a deep breath and I go look for the solution. So I honestly tie it back to that whole concept of being a victim.

Eugene Alletto: Like losing a parent to some is pretty traumatic. I mean like what am I going to do? We weren’t raised with lots of money. We had no, no real money. And you know, we all had to chip in and work. So the reason that I think I want to keep a highlight is I think out of all the things we speak about losing a parent is it’s hard to define what that is. So, you know, you asked, you bring it up. It’s pretty common with people like myself, but I think what it’s, what’s not spoken about it is learning not to be a victim is the piece of it. So my point of that is when you asked about, you know, our success, I don’t dwell on on selling stuff and making people just happy. I focus on what’s coming next. And as soon as that comes at me, I filter it as to, okay, what can I do to add value to this, to this issue? And if you take that approach to life as opposed to the concept of, Oh my God, I can’t believe it. How am I going to pay my bills? What if they return it? What if they don’t like it? What if this, what if that? And if you have that kind of respondence then it’s hard to be happy every day.

Eugene’s Biggest Joy Since Starting Bed Gear

John Benzick: Eugene, what has been your biggest joy since starting Bed Gear?

Eugene Alletto: I have three amazing different, unique kids and it’s the, it has the same sort of feeling. And what I mean by that is seeing something that you, that was born from your idea and seeing so many people embrace it and love it and get behind it is so gratifying. It is so exciting. It’s, it’s like I can only equate to why, you know, why would someone, you know, do drugs, right? I mean it’s this, they people tell me that this is like your drug. I’m like, what do you mean by that? Cause I’ve never done drugs. They said it’s this high that people talk about. And I said, well, I’ll tell you what, if we could solve, you know, drug overdoses by getting everybody to start their businesses, I, this is the healthiest high you could ever be on in your life.

Eugene Alletto: And it’s no different than giving birth to a child and then seeing your kid’s journey and how other people in embrace your child, and how, how your kid does well in school. It’s that same kind of journey. I get the same satisfaction. And the last piece that’s really awesome is to know that you’ve got 240 people that wake up every day excited to come to work and, and all being now part of what they’re, what their journey is and being part of them. So to be able to be the, the, the, you know, the center of, of that kind of emotion that you create in people. If for me it’s just, it’s a euphoric moment. It’s just awesome.

Eugene’s Biggest Frustration as an Entrepreneur

John Benzick: And what has been your biggest frustration since being an entrepreneur?

Eugene Alletto: It’s the antithesis. It is when someone doesn’t understand the value proposition that we bring to the world. When I can’t, when I can’t help somebody see. Right. So we’ve had, in the last couple of years we’ve had to create turnover in the company. And it’s been really, really sad because in some ways they’re your people that you don’t want to leave either on their own or you have to help them move on. It’s the saddest moment when, when somebody can’t make it in our company, if it kills me, it absolutely, it’s like a piece leaves every and we’re, and we’re getting better at it. You know, we’re getting better at picking people far enough in front of where we want to go. But you’re going to re as an entrepreneur, there is nothing worse than having people that, that really believe in your vision, but, but, but don’t have the ability to sort of support it in at the office, so to speak, or people that are there for just for the paycheck and don’t want to believe in the vision. And those, those things have always been a big disappointment. And then, you know, I, I put the blame on me for, for, for not, for not putting people in, in the right positions initially and I’m getting better at it. So I don’t have those, those moments of, of disappointment. But it’s the hardest thing when, when you can’t get everybody pulling in the same direction.

John Benzick: Eugene, many entrepreneurs, even seasoned ones, even like Phil Knight from Nike, the founder of Nike, they’ve experienced self doubt as they go along their entrepreneurial journey. How much self doubt have you had, if any?

A Healthy Sense of Self Doubt

Eugene Alletto: What I have is I have healthy paranoia as what people tell me. I still always feel like I got one foot on a banana peel and I, and I don’t, but it doesn’t stress me out anymore. I’ve embraced it. My feeling that I have around this, this question is I don’t necessarily feel it’s that it’s unhealthy. If you understand how to channel it, I might, the doubt is, is what I call paranoia. The, the doubt comes from the fear of letting someone down, including yourself. Uthe fear of, of being, you know, being a failure even when you’re successful. I think it’s what motivates us. There’s like an internal thing that motivates, you know, serial entrepreneurs of not wanting to be considered a failure yet if you can control that, that emotion and you can channel it towards doing good things becomes healthy.

Eugene Alletto: It doesn’t become distracting. So I don’t think I’ll ever not have doubt of something either a new product or a new customer or a new employee or a new skill that I have to learn. Right. You know, if you get the new, the new iPhone and you’re, you have doubt that the, when you download the the, the new, you know, 11.3, you might have doubt your phone doesn’t work. I mean, doubt is something, I think it’s human nature. It’s how you deal with it. It’s how you departmentalize it and it’s how you deploy it in a positive manner.

John Benzick: Eugene, how has starting a business changed you, if at all?

Eugene Alletto: Having the ability to start and see something through. I was not a very confident young man. I always was on a journey. I had hard times of finding satisfaction throughout life and it’s really helped me define who I am as a person. It’s helped give me confidence. It’s provided me the ability to have access to other unique people which create great, you know, great sort of opportunities beyond your wildest dreams. So it’s really, it’s, I think owning a business, creating a business for the right person. It provides tremendous, tremendous boost. In sort of your confidence.

John Benzick:  Eugene, since starting your business, what have you learned most about yourself?

Eugene Alletto:  I’m not as dumb as I thought I was. It’s hard to believe, when you struggle in school or you’re not the fastest kid, it’s hard to really, it’s hard to feel good all the time.

Eugene Alletto: However, when you, when things start to really click for you, that when you get that confidence boost, the thing that I realized I can learn. I’m not dumb. I can really learn a lot, but now I know how to learn where before, you know, we will put your put in a classroom and you’re taught, everybody’s taught the same way. You know, I didn’t know how I learned. I’m more of a visual. I’m more of a creative person. When you run a business, there’s operational, there’s financial, there’s creative and marketing and I’m really good at at marketing, I’m really good at the creative side. I’m really good at the selling side, but those weren’t skills as a young man that were defined as as great, right? If you weren’t great at math and science and spelling and punctuation, you know, you always felt like you were, you weren’t born good enough.

Eugene Alletto: And so to me, I’ve learned that if I put my mind towards things that I really am passionate about, that I can be a really good learner and it’s amazing how much stuff I’ve learned. I’m a great runner today. I ski phenomenal. You know, things that, that I’m, I now know when I can, I can be successful at and I pour all my efforts towards those things and it really businesses what’s taught me that it’s helped me understand the, the different parts of the business. And I just focus on the things I’m really good at and the things I suck at. I go find somebody who can be good at that. So it’s, it’s been good.

John Benzick: Who has been most influential to you?

Eugene Alletto: Well, there’s two people that come to mind immediately all the time when asked that. And it doesn’t, it, it certainly, you know, for anybody that’s listening, there is multiple people that, that you need to accomplish your goals and, and be inspired.

Eugene Alletto: I have never, ever been influenced by anybody. And the reason I say that is being influenced is the worst because you become, you try to become or emulate that person. I don’t want to be Steve Jobs. I don’t want to be Phil Knight. I want to be Eugene. Now, that doesn’t mean that I’m not inspired by their stories. I think inspiration is really what I would rather answer that. So my, my big inspirations in life as opposed to influences where my mom or is my mom to this day in terms of the lessons I learned by her actions. It’s not like she sat me down and said, you know, don’t be a victim and don’t do that. No, it was just who she is as a person. And then the other person who comes in mind all the time is my grandfather, her, her dad. She was an only child.

Eugene Alletto: And when my dad passed away, my grandfather and grandmother moved into the house. My grandmother wound up with Alzheimer’s and bedridden. My mom took care of my, my grandmother in the house while working full time. And my grandfather was entrepreneurial. He was a, he was a salesman for a macaroni brand. He was their number one sales guy in the New York market with the family. When they came from Italy. He then started his own insurance broker business. He always wore a suit and tie even at 85. And just to go to the bank. I mean just to have him as a role model and being entrepreneurial. I think that combination with the passing of my dad, those moments in time where I, the only thing I was really smart at was not was was to recognize what I had, not being the victim and my decision about that is the only thing I give myself credit for. But having my mom and my grandfather at a young age, if not having that when my dad passed away, I’m not quite sure if that year would exist.

John Benzick: So Eugene, here we are in the tell me how segment of the podcast where we get to the heart of the matter regarding key issues for aspiring entreprenuers. Eugene, let’s talk about raising capital. Did you raise capital for Bed Gear?

Taking The Risk Out of Starting Up

Eugene Alletto: So I’m in a very unique situation. I did not raise capital for Bed Gear. However, going back to my roots not having money and saving, saving nickels and dimes and working at a Burger King to go to my prom. And I’ve always been driven to be able to do things and money is required to do those things. So I have a very, very easy a way to start a business and how to fund it. And that is number one and and and most important is I find taking the risk out of what you want to bring to market is, is critical. So you have to get a prototype. If it’s a product, you have to develop the software. It’s if it’s a service and you have to find one customer, not a hundred, not 1,001 customer, one user or one purchaser of your idea.

Eugene Alletto: If you get that, then make sure that the price that you sell it at has profit. Do not come off with things that are what’s called a loss leader. If you, if you, if you don’t have access to financing or you don’t have it, an idea that you can get venture capital money or get somebody to finance you. The best way to to not be stressed out is if you get one customer to believe in you or one user to believe in you. You can take that and leverage that for financing if you need to. However, if you have a little bit of seed money, depending on the product or the service that you’re trying to provide and you can sustain yourself and you see that there’s value in it, you could take your entire savings of whatever you have leveraged everything because you already know that the product sells and you already have someone who’s willing to sell it.

Eugene Alletto: And that’s how I did it. I took, I took all of my savings and I was willing to put myself at risk because I had Sleepy’s that had committed to to buying the product and I use that, that order to go out and make a deal with, with a distributor slash factory of this product. And I just use the float and I got paid in 30 days and I paid the bill in 40 days and I had excess cash, which I saved for the next order. And that’s how I did it. So you know, to me that there’s a lot of small businesses that can be, can be done that way. I think the challenge is that most people don’t, don’t think small like that. They are always thinking so big and they need big money. Take one step at a time. Go find one customer, one product or one service and one user.

John Benzick: Would you consider raising capital at one point from venture capitalists or going public?

Eugene Alletto: So now the next learning for me is how do I leverage what I have to turn this into $1 billion business? Because that’s sort of what people see in Bed Gear is the ability for it to be $1 billion brand. Because right now our industry is made up of only a handful of brands that are all billion dollar companies and they have nothing remotely close to the product or the process or the branding that we have today. So to do that, it’s either, it takes you forever to get there cause some of these companies took a hundred years. So you got to know your sort marketplace and know your competition or do you stay, you go and you, you partner with a company whose been there and done that before and know how to, how to blow, you know, $100 million on advertising to get there.

Eugene Alletto: I mean there are certain disciplines that it may take me longer than it needs to if, if there’s an opportunity to partner with a company that’s already doing that. So I do entertain calls and meetings all the time in, in knowing what’s the next best step for Bed Gear. So yes, I would entertain all of the above and, and including the public piece.

Advice On Finding a Manufacturer Partner

John Benzick: Eugene, let’s switch gears a little bit and talk about finding or working with a manufacturer. How did you go about finding a manufacturer for Bed Gear?

Eugene Alletto: So you’ll find, I go back to the very beginning of our conversation is you don’t want to, you don’t want to veer too far away from where your either passions or your sort of skill sets are. So if you go back to my story, I’ve been in home furnishings for a long time. So my ability, in terms of my network, it was easy for me to be able to determine who’s manufacturing and or distributing like products.

Eugene Alletto: Even though I had an idea for a product, it still gets manufactured and in a facility that has this, the right, the right equipment. So I was able to leverage my furniture background and textile background to be able to find manufacturers and distributors.

John Benzick: Do you have any key tips for finding the right manufacturing partner?

Eugene Alletto: Yeah. The most important thing is that you’re able to work with somebody who, who will take a risk on you. And that’s one of the things I remember I’ll never forget and I still have one of the suppliers to us took a risk on me. You know, nine years ago and they’re still a key supplier because of that, that risk that they took with me, I had no though significant capital they gave me, gave me 60 days to pay my bill. They trusted me. They had checked my background from my previous employment and they felt like it was a good risk and they provide and that to me, you could, you’re not going to hit on all cylinders.

Eugene Alletto: You’re not going to sell everything you expected. You’re always gonna have issues along that road. And it’s very important if it’s a product that you have to manufacturer or if it’s a service that you have to that you have to code, you know, if it’s an app or if it’s an idea, you want to have a supplier that believes in your, in your vision and we’ll support you in the early stages where you may not make, not everything will go perfectly.

John Benzick: Eugene, let’s talk about marketing your product in your business or more specifically creating awareness and demand for your product. As you know, most startups have very small marketing budgets. How did you go about creating awareness and demand for your product?

Eugene Alletto: Yeah, so if you go back to the beginning of our conversation, the single most important decision we made was where to distribute our product.

Eugene Alletto: It looked more like go to a mass merchant, go to a big box retailer. And we chose not to. We went to the home furnishings channel. And the reason for that is that I was able to get sales professional salespeople to buy in and believe in our product so that they would use our products and recommend them and get excited about them and that that became our marketing. So we focused more on, on the sales process and putting our products in an area where there was a, an assisted sale. So you’ve gotta be really, really conscious of that if you’re going to go into a homogenized sort of commodity commodity type of store, like a big box retailer is really important to then identify what are the adjacencies that we spoke about earlier, like what’s to the left and the right of your product?

Eugene Alletto: What is your value proposition on the shelf? And make sure that your packaging is clearly definitive as to why would you be picked compared to your left and right adjacency. So you really have to understand the channel of distribution, who your competition is and what is the value proposition that you bring. Even if the buyer buys it for the store or puts it on the shelf, it’s your responsibility to make sure that it’s going to sell and you have to make sure that you can convey that message to the consumer who’s walking by it. And if you look at Bed Gear, if you go on our website, you’ll, I don’t even have to talk. You’re going to be, I got it. I understand nothing because many people make mattresses and pillows and sheets and blankets. So how did I differentiate myself as I made sure that the value proposition that we bring, which is per personally personalized fitting of our products to you as opposed to just pick one, it doesn’t matter.

Eugene Alletto: And the second thing is airflow. All of our products have a CFM rating which shows to you that that every single layer of our products create airflow around the body because the airflow is what is what helps our bodies regulate our temperature and we all know how miserable we are when we’re cold and hot in bed. Those are our two value propositions and so in doing that we make sure that our packaging, our messaging and our channel distribution is organized in such a fashion that we know what to deploy depending on where our products show up. So that’s in a nutshell, that’s what you got to really focus on is no, no who the audience, the end, the end consumer is and make sure that the value proposition is easily identified within the channel of distribution that you choose.

John Benzick: Finally, Eugene, did I miss any questions that you feel you’d like to provide answers to, or do you have any closing pieces of advice for our aspiring entrepreneurial listeners?

Finally, Never Give Up

Eugene Alletto: I’ll do this real quick. Number one, you never give up as long as there’s one person that believes in what you believe in, you continue to forge forward. If you’re the only person in the world that believes in what you believe in and you can’t convince anybody, even your dog to walk with you anymore. That’s the sign that you got to fold up and try something different. But as long as you can convince one person, never give up. Very important.

John Benzick: Fantastic. A great way to close. Well Eugene, you’ve been a terrific guest offering some great stories and advice to our aspiring entrepreneur listeners. Congratulations on your success for your entrepreneurial courage and for sharing your experiences with us today. It’s been a real pleasure.

Eugene Alletto: My pleasure, John, and thank you all listeners for taking the time to listen to my story.

About the author, John

John Benzick is an entrepreneurship coach and the founder of Venture Superfly. He is a Tech Partner at the venture-capital fund of Matchstick Ventures, a Mentor with Techstars Retail accelerator, an Entrepreneur-In-Residence and (former CEO-in-Residence) at the University of Minnesota, and founder and owner in two consumer product businesses. Click the button below to learn more.

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