Nick and Jo James, co-founders of online bedding company Bedfolk, sold their flat to fund their online bedding business. Here Nick talks about what difference winning the Start-Up Series has made and why getting into bed with Worth Capital was so important
Engaged couple Nick and Jo James were finding the experience of shopping for bedlinen extremely frustrating when they hit on the idea for Bedfolk.
Traditionally dominated by one or two department stores, Nick and Jo decided to set up an online business exclusively selling the finest cotton sheets, duvet covers and pillowcases. They are inspired by other online vendors who specialise in one bespoke product, such as Harry’s razors.
James says: “For a product you spend a third of your life in, it seemed ripe for disruption, getting better quality at better prices.”
The couple spent a year researching the bedlinen market, trying to source the best suppliers. The couple spent their honeymoon romantically or not, depending on how you see it, visiting textile factories in Portugal before settling on one in particular.
James says: “We go and do the hard work to find the best materials and the best makers and because we’re online we can do it at a fraction of the traditional luxury retail price.”
The couple, who like many entrepreneurs were working full time while pursuing their start-up dream, sold their London flat to raise working capital and persuaded a Portuguese bedlinen factory to let them place a minimum order. Having moved to a rented cottage in the Cotswolds, their sitting room became a bedding warehouse when the pantechnicon arrived with their first order. “Building a start-up is a bit like jumping out of a plane and sewing the parachute on your way down,” James jokes.
Bedfolk launched in 2018 selling three types of cotton bedding styles, adding a new linen range only four months ago.
The couple were funding themselves until they won the Worth Capital Start-Up Series funding competition in March 2019. A month later, the Fund invested an initial £90,000 in the online bedding site, before coming back with subsequent investments.
Here Nick James talks about what difference having Worth Capital on board has made to Bedfolk, what effect COVID-19 has had on the business, and their plans for the future.
How important was winning Start-Up Series funding and what has Worth Capital done for your business?
Well, the first thing having Worth Capital’s investment meant was that we could go full time and pay ourselves a small salary. It gave us certainty and meant we could put 100 per cent into the business and give it the love it needed to accelerate it. Launching Bedfolk as a side hustle was hard work, plus we had put all our money into developing it. (We got some raised eyebrows from our parents when we did that.) The other thing I quickly realised is that it doesn’t matter if you have the most amazing product, if you don’t have marketing budget and brand building. Marketing is the lifeblood for a new brand and the Worth investment allowed us to invest more heavily in this area.
Apart from the equity investment, how has winning the competition affected Bedfolk?
We have had a lot of support outside of just investment. Being a founder can be lonely. The cash is great but also the non-financial support Worth Capital gives you. Typically venture capital funds have lots of ex bankers or management consultants and the support they offer often feels more arm’s length, whereas Matthew Cushen and Paul Soanes, the co-founders of Worth Capital, have both been in business. Matthew worked at Woolworths, John Lewis and IKEA and, as a pair, they are not afraid to roll up their sleeves.
What advice would you have for anyone who wants to enter The Start-Up Series?
Even if they don’t invest, Worth is really good at giving feedback, which you can use to grow your business or become more investment ready. That said, investment isn’t for everyone. It comes with stress and pressure, and an expectation of rapid growth. There are other ways of funding your business and equity investment is not a silver bullet.
How has the COVID-19 pandemic affected your business?
We have been lucky despite the coronavirus. We operate in a market that has probably benefited because of lockdown. You read about people spending less money going out and instead upgrading their immediate surroundings. We’ve seen an increase in demand because of that. The pandemic has accelerated the shift from physical retail to e-commerce. From a blunt growth and sales perspective, COVID-19 has been a positive for us as a business.
What changes have you had to make because of coronavirus?
Well, we took on our first full-time staff apart from Jo and myself in February and, all of a sudden, we’re all working from home because of the pandemic. On the other hand, we have not furloughed anyone. In fact, we’ve just hired someone else and are just finalising our fourth new member of staff.
What is the outlook for Bedfolk now?
Our plan over the next 12-18 months is to continue growing our customer base here in the UK. There’s a huge market and so many people don’t yet know the joys of Bedfolk bedding. We’re also planning to launch more products to complement our bedding range, including quilts and throws in the autumn, and, beyond that, ancillary products such as towels, pyjamas and dressing gowns.
For those businesses interested in taking part in the Start-Up Series competition, beginning again from September 1st 2020, please register your interest on our pre-registration page.
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