#76. Lunya makes luxury sleepwear that puts equal emphasis on function and aesthetics. We talk with founder Ashley Merrill about how her business is breathing new life into a frequently forgotten, but everyday apparel category. The Loose Threads Podcast features in-depth discussions with leaders across the rapidly changing consumer economy.

Check out the full transcript below.

Richie: [00:00:07] Welcome to the 76th episode of the Loose Threads Podcast, a show about the rapidly changing consumer economy. This episode is brought to you by Loose Threads Membership, which gives you actionable analysis, insights and events that drive growth, and Loose Threads Espresso, your energized and high-pressure filter for consumer news—in context. We also have a newsletter that features the latest open letter to CEOs, podcasts with industry leaders and news from Loose Threads. Check it all out at LooseThreads.com.

Richie: [00:00:35] Joining me today is Ashley Merrill, the founder of Lunya, a luxury sleepwear brand that’s bringing performance to a frequently forgotten type of apparel. Ashley founded the brand after asking why products that you spend significant parts of your life living in were such an afterthought.

Ashley: [00:00:50] I thought, “Wow, wouldn’t it be great if I could be comfortable but I could also feel flattered? Like the clothing flatters my body but it could also function well?”

Richie: [00:01:02] Since then, she’s been building a brand that doesn’t compromise on function or aesthetics while also expanding the digitally-native brand into retail. Here’s my talk with Ashley Merrill.

Richie: [00:01:15] Why don’t we start. Just talk a bit about your background and then we can work our way up to this company existing.

Ashley: [00:01:20] I started off, actually, at a VC. I was only there for about a year but it was a great way to get general business understanding. And then I actually worked for an online media company and I was there for a while, maybe four, five years, doing and M&A and helping them build web properties. It was an incredible experience. I learned a lot about building a brand, audience acquisition—all of that good stuff. And then I actually ended up going to business school and it was actually while I was in business school that I created Lunya.

Richie: [00:01:52] Why did you leave those two previous things?

Ashley: [00:01:55] Yeah, so I actually left the VC because, while I loved and I still actually love being involved in new businesses, I sort of felt like I was on the wrong side of the table and that I wasn’t in a true place of being able to judge whether something had legs because I hadn’t had any hands-on business experience. It’s really easy to say that an idea is good or not or whatnot, but to truly know if someone can pull it off, from my experience, you need to understand the intricacies of what makes businesses work and sometimes not work. And so I had none of that reservoir of experience to pull from. So that was why I jumped into that.

Ashley: [00:02:34] At the time, online media was gangbusters. It was sort of the place to be as a new, growing industry. Obviously, websites had been around for a long time, but the ad business is and was really beginning to be big business. And I really enjoyed it. So the reason I actually left that is because—so I was there for a while and I loved it and I had a variety of experiences while I was there so I continued to feel like I was learning and growing and whatnot. But after, I actually built a property—Momtastic—and I got to assemble the team and create the vision. It was that true ‘intrapreneur’ word where I really got to own the project and helped build the team and it was amazing for me. But, at a certain point, I kind of did it and so then I proved to myself that I could do it. And I realized, at that point, that that was what I wanted to spend my whole time doing, was either creating something and—by the way—it didn’t have to be my own thing. At that point I wasn’t sure if I was maybe going to head to somebody else’s startup because I wasn’t sure that I was ready to take the risk to start my own thing.

Richie: [00:03:31] And so you went to business school.

Ashley: [00:03:33] I went to business school, which started in September. We had decided, my husband and I, that I would probably try to get pregnant around that time. So I was kind of thinking, “Okay, I’ll have babies while I’m in business school. This will be great. And in the meantime, I’ll noodle on some business ideas or I’ll meet people and maybe find something that I’m passionate about.” Well, as it happened, I had had the idea for Lunya years prior, but [it] had just been sitting there in the back of my head. I could think of too many reasons not to do it, is basically what happened. And then I went to business school in September, found out I was pregnant [at the] end of September. We made quick work of that and then I realized, at that moment, that if I didn’t start the business then that maybe I never would. And that my reasons for not thinking that Lunya was a good idea were not actually ’cause it wasn’t a good idea, but because I wasn’t confident, I was afraid of failure—the true things that hold back a lot of people. And then I thought to myself, “If I don’t do it then I’m going to have to tell my kids that I didn’t do it.” And that actually felt like a much bigger risk than not even trying. And so it’s so interesting. I had always anticipated my kids sort of holding back my career aspirations and all this. It was the thing that made me do it.

Richie: [00:04:46] You said that this idea came about years before that time.

Ashley: [00:04:49] Yeah. It was one of those things. You probably have a hundred ideas. It was one of those ones that had stuck with me for a while. I actually had two ideas that I was between, but they were the ones I couldn’t shake. And so then I realized there’s legs here though. My process of getting to good ideas, even today, is very much about trying to prove myself. I beat my own ideas up so hard.

Richie: [00:05:11] Scientific method.

Ashley: [00:05:12] Yeah, exactly. So I basically tried to convince myself a hundred different ways that both ideas were bad and this one did because I kept coming back to there’s actually no good reason why this won’t work and why this isn’t a good idea and why this isn’t going to be valuable from both a consumer’s perspective and a business perspective. And I couldn’t shake it.

Richie: [00:05:31] So how do you start? What was the first thing beyond the conviction?

Ashley: [00:05:35] Well, it’s one of those things that was pretty anticlimactic. You decide, “Okay, I’m going to do it” and then the first day is me googling how to create a product. It’s one of those things where—people often ask me this question. But what it meant is I had convinced myself and, once I had convinced myself, I got comfortable vocalizing it to other people. This is one of those things where I actually, even today, am so committed to trying to help people and talk with them because I’m so grateful for those people that supported me. Because what it really amounted to was I started putting it out there in the world. I said, “I have this idea. This is what I want to do and do you know anyone that maybe I could chat with about it?” What I found is people are excited that you’re excited about something and, when you’ve convinced yourself, your conviction is contagious. People were incredibly generous with me. It meant that I would have a lot of worthless meetings, honestly, but, occasionally, there’d be a nugget of awesomeness in those. And sometimes that person would lead me to the next person and to the next person. So, once I had committed myself, I wasn’t going to stop until I got the information I needed.

Ashley: [00:06:38] It took me—and it’s worth noting this—two years between when I said I was going to start a business and actually launching product. And that was because I really knew nothing about creating clothing. I had this idea of brand and web, but that was really not valuable until I had made product which took me a hell of a long time.

Richie: [00:06:57] What was the idea then? Was it ‘create a sleepwear brand’? How did you articulate it then?

Ashley: [00:07:01] You know what’s so interesting is the idea then is exactly the same idea that it is now. It’s because it wasn’t a plan it was a problem. I was wearing a substitute product. I was wearing an old t-shirt and my husband’s boxer briefs and that was what originally had sparked that idea years prior. And so I thought, “Wow, wouldn’t it be great if I could be comfortable but I could also feel flattered? Like, the clothing flatters my body, but it could also function well.” So one of the things we don’t think of often in sleepwear, or I think we don’t think enough, is that it’s actually very much a functional product. We take for granted that our athletic wear has straps that don’t twist and wicking fabric and all these things but sleepwear has a whole list of requirements for ideal sleep conditions just like you would expect from anything else like that. And so the problem for me was always how do I make people sleep better? And how do I give them something where they’re going to feel like their best self around the house? That vision, that problem is still the one I’m solving. It’s just that, as we’ve grown, I’ve been able to be a little more sophisticated in the ways we’ve solved it.

Richie: [00:08:07] So you know you have to make product. You don’t know how to do that.

Ashley: [00:08:10] Sure.

Richie: [00:08:11] How did that go?

Ashley: [00:08:12] Yeah, yeah, of course. So it was so funny and this is where you never know where you’re going to meet people [who] are going to help you get along your journey. One of my friends owned a store and I remember saying to her, “Gosh, I have this idea.” And I told her the idea. “I’d love to make sleepwear that was incredible and that changed the way people thought about sleepwear but I don’t know how to make any clothing.” And she connected me with a girl that, actually, she had interfaced with because this friend owned a boutique and so she was a wholesale buyer and so she did have some connections with people that own small clothing brands and so she connected me with one of the small clothing brands and one of the girls who worked there, who happened to also be interested in freelance stuff on the side. And so that was really the first person that connected me to someone that was meaningful and helped me on my way.

Ashley: [00:08:59] This girl helped me learn the process. What are the steps? Because I didn’t even know what problems I needed to solve. Who do I even need to talk to? What is production? These are basic things I couldn’t answer. And so she helped outline the process for me and then helped me think through what were the people I needed to be successful in this process? She had some people she knew. I knew enough to put up job descriptions. In this early stage, it was me in my home office and I had people [who] were basically consulting. They just helped me on little pieces of it so nobody was full-time at this stage. That’s really what it started looking like. She told me, “Oh, you need a designer,” and I went, “Okay, I need a designer.” So then I would start asking around and put a post up on Facebook, “Does anybody know a designer or how to get one?” I mean, literally, these questions were so embarrassingly dumb. But I think that being honest with people and just being unafraid to be vulnerable and to not know the answers served me really well. And so people would connect me and then that person would connect me to someone else and that’s kind of how the whole thing [happened].

Richie: [00:10:00] Yeah.

Ashley: [00:10:01] Yeah.

Richie: [00:10:01] And so at the end of 2013, which is one year into this process, where are you?

Ashley: [00:10:05] I have one employee and so it was two of us in a room and we still don’t have any product to speak of. So it was pretty embarrassing but we were in the sampling process. We were learning a lot. So all of those failures, which felt devastating at the time, were the way that I got my education. I didn’t realize that’s what I was doing at that point but that is exactly what I was doing and we were both doing it together. I was driving out to some rough areas in downtown and getting stuff manufactured and it was coming out all wrong and then I was trying to communicate with them with my limited knowledge about how to describe the problems. So it was long and challenging but incredibly informative. So, at that stage, I still had really nothing.

Richie: [00:10:47] Yeah. So what sort of products were you working on? So you have this problem, which you identify.

Ashley: [00:10:51] I had basically devised, I think there were seven pieces—a seven piece collection as the first starting collection. The challenging thing about clothing—and I think every business has its little nuances of things you have to understand about it—was I had this big vision. And, what I realized is, nobody wants to talk to you if you’re going to make 300 pieces of anything. Literally nobody. It got to the point where I was baking cookies for people to get them to make clothes for me. So it was so frustrating in many ways because I knew what I wanted to do so clearly but the process to get there was very unclear. And then, even, I would look at the product and I would just be so frustrated because it would look so far away from what I had seen in my head. It would be this process of finding the fabric people and getting that figured out and then we try to sew it together and realize that fabric didn’t work for sewing and and then I would know the right fabric that I needed or I would wish I could develop my own fabrics, but the minimums on all this [were] much higher than I could pull off. Even today—but with all business—I just find it’s like one enormous chicken-before-the-egg problem. And so, if I did it today, I actually would probably have tried to design maybe two pieces or three pieces that I could have done less, and done it better. But hindsight is 20/20.

Richie: [00:12:06] Absolutely. Okay. And so walk through 2014, then. Take us basically up to the launch.

Ashley: [00:12:11] I think it’s sort of worth noting I had a kid in June 2013 and then I had another kid in September 2014. So I’d like to say I was just like kicking ass this whole time, but there [were] definitely challenges along that way. Getting us to 2014, we finally got a collection that we were like, “We’re proud enough of this. We think this is the first start and there’s really no way for us to get a better product without putting this one out there and getting some feedback.” I think we propped the site up in what we called beta. And it basically meant I called all my friends and emailed everybody and asked them to come over and support me and whatnot. So I’m still very indebted to all of them. And then, it was the funniest thing, I put this email out because I had gone through so much with the pregnancy and [was] trying to still work and driving downtown and doing this whole thing and, I told you, I had this girl that was working with me and she would just jump in any time I couldn’t do it and whatnot. So I wrote this note to her on Facebook just being like, “Jasmine, thank you so much for all your support. I can’t thank you enough for the help you’ve provided” and whatever. Well, it was funny, because we had a lot of mutual friends. And so everybody thought that that was me officially launching the site.

Richie: [00:13:23] This was a post on her wall?

Ashley: [00:13:24] Yes, and this was while I was in the delivery room because I had, at this point, already had the epidural. I was feeling fine. It was a long road. I was doing email. And so I post this and then it’s on her wall. It’s gaining traction. Everybody’s commenting and I’m like, “Oh my gosh, I’m never gonna be able to get this kind of reaction again. I have to put the site live.” So we put the site live. So I’m literally delivering my two babies at once. It was kind of this accidental launch. But it was this really funny thing because sometimes you just gotta roll with it.

Richie: [00:13:53] Yeah, absolutely. So how did it go?

Ashley: [00:13:55] So what happens when you put a site live is nothing happens. Yeah. I thought, “You build this incredible product and people will come.”

Richie: [00:14:02] What was the number you had in your head for sales you expected to do on that day?

Ashley: [00:14:05] I wish I had remembered. I honestly have—I don’t even know.

Richie: [00:14:08] Because everyone has one.

Ashley: [00:14:09] Even if it had been a thousand dollars, I’ll tell you right now, I was way off. Nobody comes. My mom probably went a couple of times. So nothing happens, except that I did get a bunch of visits of people from the Facebook page. It was a small trickle in, emails of congratulations—that kind of thing. And so I learned a lot from that point, which—I realized that you build it and they will not come. And so I realized how important marketing was in that day and that helped send me along on the next piece of the business that I knew I had to build out and that was really figuring out what the user acquisition and market. I always knew I was going to need a strategy around that, but that certainly helped remind me how important that is.

Richie: [00:14:46] So you launch a site. It’s now out there. You have seven or so pieces.

Ashley: [00:14:50] Yeah.

Richie: [00:14:51] What’s next? And it sounds like it’s that.

Ashley: [00:14:52] So I ended up actually hiring—there [were] a few different people [who] were consulting at various different times but, I’d say, one of the great additions to my team was a girl named Sam who still works here. She made these wall hangings and I thought her wall hangings were awesome. Super random. And then, when I chatted with her, I realized that she managed social media for some other people and I was hiring. I was like, “I need a social media person.” I had this conversation about wall hangings being like, “Hey, could I get one of these things?” and I’m talking her. And then we end up chatting and I can’t even remember why we end up chatting. And then I’m like, “I think we should have an interview,” because I start looking at her Instagram and her Instagram is beautiful. And so I’m like, “I’m going up and I’m going to send you a job description and then I’m gonna call you tomorrow and let’s make this call an interview call.” And she’s like, “Okay.” That happened. We had a great interview call. I fly her out. She lives in Minnesota at the time. And she buys in. She’s in it. She gets we’re trying to do and she also is incredibly talented and artistic and, actually, she is an art director here at the company so she’s scaled into a much different role. But very instrumental in beginning to build this marketing story that we’re talking about which was she helped us establish what the look and feel was.

Ashley: [00:16:03] My job is sort of this vision role, is sort of how I see it. And I do have a creative, aesthetic vision for the company. I’m actually quite specific about it. But having a vision of what you want it to look like and being able to make something look like that are different. And she was able to naturally make it look like that. And so she’s somebody who, I think, really helped us figure out what marketing would look like here. So very sort of early stages of the photography and all that.

Richie: [00:16:31] Talk through how you formed or what you wanted that aesthetic to look like and also talk more about the customer, as well.

Ashley: [00:16:37] So I knew what I wanted it to look like. I knew I wanted to be this modern sleepwear brand. From my perspective, the gap in the market was people somewhat like me. I felt like you’ve got this traditional pajama set with origins in that “I Love Lucy” era, that’s full, long sleeve with the piping and all this. That’s not a product for me. And then I thought, “Okay, you’ve also got lingerie and that’s also not a product for me.” And maybe at different points they are but this is not my everyday sleeping product. And I thought, “I want something that I would look at and I would want to buy. I want it to feel cool and modern and fresh. We’re taking a completely different view on what sleepwear can mean and the site needs to reflect that.”

Ashley: [00:17:19] So we ended up with this very clean, minimal, modern aesthetic. And we also knew, when we talk about the customer a bit, we had a sense for [whom] we were serving but, at that point, it wasn’t formalized. Like I said, I just thought, “Do I like it? Does Sam like it? Do we feel…”—we kind of triangulated a sense of who this customer was. That was something we tested off of people [who] were buying our product. We actually started doing phone calls with people [who] bought our product. “Why did you buy our product? What do you like about the product?” We tried to learn a lot from them. But we had a sense of who we were serving because we were using ourselves, somewhat, as a guide, but we were also a little bit wrong.

Ashley: [00:17:55] You think you’re designing for one person—and we weren’t a lot wrong, but I actually thought—and I’m a mother and I was a mother very much through the formative stage of the company—and I thought, “Oh, this is an incredible product when you have to be around the house a lot,” which is often what early motherhood looks like. And I thought, “These moms are just going to love this product.” But it’s interesting because our early adopters have been younger than that. There are a lot of working-out-of-the-home women, live in major cities. I was a little bit surprised by that but, as I look back on it and I think about it, you do tend to, even sometimes accidentally, create companies in your image—which was not my intention, but you almost can’t help yourself. And I think, actually, when Sam and I were thinking about aesthetics and some of those elements, we did. But I’m not just a mother. I’m this other person also. And so, in some ways, it is a blend of those things and I think it was interesting that we resonated very quickly with this audience that was clearly very hungry for it.

Ashley: [00:18:53] We talk about it often as, this is the girl [who’s] transitioning to adult-ing, right? She’s not in her first job. She’s starting to think about her space around her. She’s maybe a little further along in her career. She’s having a little extra income and she’s like, “You know what? I want a nice bed and I’m going to buy a good furniture piece for myself for the first time. This Pi Phi shirt I’m wearing around the house doesn’t fit in this environment anymore.

Richie: [00:19:15] Right. She’s investing.

Ashley: [00:19:16] She’s investing. Exactly.

Richie: [00:19:18] Yeah. What pieces were resonating? And then also, I’m curious to talk a bit about price point and how you figured that out too.

Ashley: [00:19:24] I only know who buys our products so it’s hard for me to know what wasn’t resonating because those people just don’t buy our product. All I know is, apparently, the aesthetic and the product that we’ve been working so hard on was speaking to her. There’s been a lot of refinement since that point where we understand more deeply. We have a lot of thought around body types. Some women don’t want to show their knees. Some women want a sleeveless outfit. There’s a lot of specifications different people feel. And one of the things I think I didn’t fully anticipate in the early days was I thought, “Oh, I’m gonna to make the best set of sleepwear.”

Richie: [00:19:59] As if there’s there’s one answer.

Ashley: [00:20:01] As if there’s one answer. And I think what I have learned to embrace is that there [are] multiple solutions for that and so that was something.

Richie: [00:20:08] Specifically to the products, what were some of—verbally talk through [it].

Ashley: [00:20:12] The Robe has been with us since the beginning. It’s been a great seller. It’s called The Robe. I think people know to come to us for this robe. It’s so funny. It was one of these pieces that—actually, my mother-in-law was very inspirational behind this piece because she would tell me that she would wear these big, oversized terry robes and she’d get out of the shower and she had to take it off because she gets so hot. And then she felt so bulky—like it wasn’t flattering for her. And that got me really started on The Robe. The process for product creation here is unlike a typical fashion company in that it’s the problem-solving one. It all comes back to the actual origin story of this company. We are always solving problems. So I thought, “Okay, what’s the perfect robe?” And had interviews with tons of women about all the challenges that they face with their robe.

Ashley: [00:20:56] These are things you take for granted. You get used to product that doesn’t work well for you. And so really pushing them, I had to understand how they were using it because sometimes they didn’t even see the issues. But the robe is a perfect example, actually, because we found out that people find when they’re washing their face or cooking that their big sleeves, they catch on fire, they get wet or whatever. This sounds dramatic, but it’s true. They don’t need, actually, the super plush terry robes. They’re using a towel after they get out of the shower and then they throw on their robe. So we needed more of a medium weight and that also helped solve the bulky feeling that we were seeing. But we knew that we needed a lot of absorption around the hair so we created this more absorption area in the high neck. We also knew that sometimes robes can be low on the neck line, which is fine, but to have the option to be able to have it be more closed when you’re answering the door for the Postmates guy or whatever, just so that you have this flexibility with it is great. A lot of women told me that they’re tripping on their robe going up the stairs. So we created a design that sort of cut into the front of it to allow them to walk up the stairs. People lose their belts so we attached the belt. I mean, this is literally the process for every single product. So when people see our products I’m like, “Wow, if they only knew how much I beat this product up.” And also, in that product process I should mention, I’m the fit model. I’m the fit model because it’s a feel thing. Certainly, we need to make the product fit well but I think most people can relate to how it feels when you feel good in something. It’s not as clear as does it fit? I wear it. I fit in it. I sleep in it. We use it. We make it live and breathe with us.

Richie: [00:22:31] And so, at this point, you’re selling only on a website.

Ashley: [00:22:33] Yes.

Richie: [00:22:34] So how do you convey all of this? Because I think that’s one of the most interesting questions for all these digitally-native brands is how do you externalize all the internal effort?

Ashley: [00:22:41] I’ll say that’s something that we iterated on and we’re still iterating on. We read this great book where it talks about how hard it is to be clear and they use this example of, if I throw you three pieces of balled-up paper at once and ask you to catch them, you won’t catch any, but if I throw you one, you’ll catch it. So this idea of simplicity of message.

Richie: [00:23:01] Right, like the tasting menu [of] over 100 options.

Ashley: [00:23:04] Yeah, and that it’s actually for our girl. As I told you what our girl looks like, she’s busy. It’s actually our job to try to be clear in message and edited in product. That’s really—we see that as our responsibility. So I’ll say it’s something we’re iterating on. We were able to use—this is one of the gifts of creating a product that resonates so deeply with you and your team–which is we used ourselves as the first line of defense against sending the wrong message and then we would be able to test the lot. It’s the great thing about being online, is it’s naturally iterative. Oh, that homepage didn’t work. Let’s swap it out. Let’s try something else. Let’s A/B test. Let’s try an email. Let’s see what the conversion is. Based on that conversion, we know that that storytelling really worked for her. I often talk about the idea, too, of a bowling alley but with bumpers where you’re bouncing off the sides to figure out your true north and that’s really what it looks like.

Richie: [00:23:54] So, 2016, you start to pay on the marketing side.

Ashley: [00:23:58] Yeah.

Richie: [00:23:58] How does that whole journey go?

Ashley: [00:24:00] It’s like an act of faith, right? We outsourced it and so we worked with a different company that did it. And you talk to them and they say they’re going to need $10,000 to even figure out if this is going to work and that’s a lot of money when you’re starting a business. You also have to have the inventory on hand. You have to do a lot to make that work. But that’s what it is. So I’m like, “Okay, if I can’t acquire customers online then I don’t have a business so I actually need to spend the money and I need to find this out.” So we give them $10,000 and they’re like, “We’re going to spend $10,000 dollars in three weeks.” That’s what it was. This is a lot of money very fast.

Richie: [00:24:33] You’re about to burn some money.

Ashley: [00:24:33] Yeah, I’m like, “Ah!” So we do that. So I give them the money. I think we were acquiring customers at $600 a customer.

Richie: [00:24:41] Not ideal.

Ashley: [00:24:41] No. Does not make a good business. But I stuck with it because I’d already told them I would. And they got the numbers down to an area that we were like, “Okay, we could do this. This is good.” It wasn’t at a place where I was like, “This is awesome. We’re killing it.” But it was at a place where I was like, “Now I can push it back to the creative team and we can work on photography and we can work on copy and we can play and see if we can optimize this a bit more.” So we got into a range that started to be promising.

Richie: [00:25:08] Talk a bit about the fabrics and where you started, because you can’t develop anything, and then how that’s evolved over the course of the brand.

Ashley: [00:25:14] So, at the beginning, I was like, “Okay, I want something breathable and soft and amazing.” Like I said, though, I didn’t have a deep knowledge of fabrics and I didn’t have a lot of money or ability to create. So that meant I was emailing random mills all around LA and going into their showrooms and touching things and trying to fill what felt like what I had in my head. And so I’d find things and we’d make products but it turns out, it’s hard to test durability on products that you start. Do they pill, all this—? You kind of can’t know that until you wash it a ton of times. Clearly, I had no QC department in the early stage. It was me and Jasmine, as I mentioned. We would make things and, sometimes when we would sew two different fabrics together […] we learned, “Oh my goodness, shrinkage is different from one fabric to the other.” And then you’d get torquing or something weird that’s going on. You’d get pilling. So I think the thing that was tricky at the beginning was figuring out if there was a fabric that could be good enough that we could feel proud of it. Because, certainly, we knew that it was so important the first impression that you make especially since my mom was probably my only customer. So we really wanted it to be this great fabric. But, like I said, it was a little bit limited. So we found something that was still an improvement on what she was probably wearing to sleep.

Ashley: [00:26:25] What’s been amazing through the process is [that] the sophistication of my production team has grown enormously. Their expertise and their knowledge around fabrics has guided this company to be best-in-class in fabric. That’s been a real process as I described. We moved from those first few fabrics, which were soft and were close enough and on par with some of the things that you might have seen other places, to some best-in-class natural fiber products.

Ashley: [00:26:55] Where we landed was organic Pima cottons. By the way, within Pima cotton, there’s different grades of Pima. So some people say they’re Pima but you won’t maybe notice the same level of quality. What we found was pilling was a big concern. We wanted these lightweight, cotton, breathable fabrics but we didn’t want them to pill. Well, it’s hard to make something that’s a natural fiber, that’s incredibly lightweight, that’s going to hold up to what you need for everyday wear, which is what a sleeper product is. And so we’ve really come to love Pima. It’s a long-staple fiber. What that means is that there’s [fewer] ends and, whenever you get pilling, what that’s really telling you is that the end—yarn is made up of lots of little pieces of strands that are spun together and, if those strands are very small, the little ends stick up and it pills. And so we needed to minimize the number of ends to minimize pilling and so we came across Pima cotton and we’re a big fan of it. We found this to be a really great solution for us.

Ashley: [00:27:48] We also moved into washable silk. We loved silk. It’s a naturally thermo-regulating fabric, incredibly soft, but most of the time you see it as a dry clean product. Clearly, we didn’t think that was a good fit for sleeper. Our girl’s busy, as I remember telling you earlier, and we didn’t expect her to be running to the dry cleaner. And so we began problem-solving again. That’s the approach here. I wasn’t willing to give up on silk and how do we make it so that the quality doesn’t change from when she buys it and when she washes it? So that took us a lot of development to figure that out and we got to a place where we have this incredible silk and you can cold water wash it and it holds up. And so that was that stage of the business.

Ashley: [00:28:28] Where we have progressed to now is we’re big enough now where we’re developing—not only are we developing our own fabrics which we started doing, I’d say, maybe a year ago—we are innovating. So we brought on someone to help us with fabric innovation. With that, we are looking at problems in a whole new way. If you think about wellness as a pyramid and you were to think about ‘what’s that foundation of the pyramid?’ Like a food pyramid. I’d view sleep as that foundational element because there’s plenty of studies out there that will tell you you’re not going to eat well, you’re not going to work out or do any of those things without sleep. So I view optimizing sleep as pretty foremost in your wellness plan. And so we meet with a lot of women and call them and talk to them and we use ourselves and we think about what are the things that sleep—we could use this time to do better for us.

Ashley: [00:29:16] The first fabric that we released—we’ve got this Restore line. And this is still Pima because we love this Pima cotton, but now we have infused the yarn with Celliant which is basically crushed up minerals. These minerals help your body recover faster. It actually helps oxygenate. Your body gives off some natural infrared energy and it reflects it back on itself. This is me dumbing it down to try to explain something. Then what that does is [it] actually helps create more oxygen in the blood. There’s all sorts of wonderful effects. One of them could be, if you have a hard workout, actually, improving the recovery with your muscles. So I love it because I’m an efficiency person. I’ve got kids. I run a business. Multitasking—that’s all my favorite. So I like it because, in some ways, it makes me feel like I’m now utilizing my sleep better. So I’m not just going to sleep, I’m improving my body and creating this wellness garment that’s really taken to the next level.

Richie: [00:30:08] And so, as you push forward on the technical side, how do you sell that in a way that doesn’t make this technical?

Ashley: [00:30:14] Being a natural fiber company is the core to what we do. All of our garments are majority natural fibers because you do not want to sleep in a plastic bag. We’re not athletic wear. And so I think, having people trust and understand that that’s where our hearts that, I think it makes them more receptive to the idea of, “Wow, this mineral-based technology is amazing and I can have that inside of my Pima cotton.” So, from a functional standpoint, I think they’re already naturally receptive to it. From a messaging standpoint, the marketing angle of it, it’s just like it’s always been. It’s trial and error and figuring out how to explain this incredible piece to her in a way that she can fully get excited about and appreciate.

Richie: [00:30:54] Bring us up through 2017 to the present in terms of major milestones that get us to today.

Ashley: [00:30:59] Yeah. So we’re, I’d say, about 17 people here. We’ve got a ton of open positions so we’re growing. We’ve had tremendous year over year growth, roughly five-times year over year growth since we launched product. We have a store here, as you’re in right now, in Santa Monica. This, actually, also was an interesting experiment. Like I said, the retail world is being turned on its head. So figuring out what is still relevant is one of the things we’re trying to figure out. But brick-and-mortar still has its place. We’ve seen that a lot of customers—I think there’s so much junk online that they want to come touch our products and, when they touch it, it’s done. They understand how incredibly soft it is and what the quality is. And so, almost, by not having brick-and-mortars, we were doing ourselves a bit of a disservice. So we have this brick-and-mortar here. We realize people come from very far to come here. People, when they visit us from other states, it’s because we were on their list. We find we have a real motivated customer and that the tactile is still really important to her. So I’d say milestones here [were] definitely launching the store, proving that there’s still a world where this brick-and-mortar is important for us, growing the team. We have much more store expansion and product extension and all that planned in the near future.

Richie: [00:32:14] Very cool. So, as you think about the scale of this, how big do you think it can get and how big do you want it to get?

Ashley: [00:32:21] So we’re a customer-centric company. That was core to why we even started. So we’re problem-solving and I think, ultimately, the customer is going to be the deciding factor of that. But, with the interest and incredible support that we’ve seen now, I’m bullish. I think our product is worth it. I think people who buy it—we get these love letters from customers and, every time I get them, I always think about what it takes for somebody to write that letter. I don’t think I’ve written very many of those letters to companies.

Richie: [00:32:49] I think you realize, when you have a company, how hard it is to get feedback from people.

Ashley: [00:32:52] It’s so hard. Usually, it’s pretty easy if you get negative feedback.

Richie: [00:32:56] Right.

Ashley: [00:32:56] But to have someone take the time to say how meaningful the product is to them. We get a lot of those letters and it blows my mind. And so every time that happens I’m like, “We’re doing something and this is important.” But, on a bigger company standpoint, we’re also a female-led company. And I think it’s very important, once you’ve got the DNA of what can build an incredible company, we need some women to win, frankly. We need to see some successful women-run companies. The stats aren’t good. Roughly 30% of businesses are created by women and I think it’s somewhere between 2% and 4% of them ever make more than a million dollars in their entire existence. It’s a small number. So I am motivated. We’re past that number at this point. But there’s also some pretty not encouraging numbers around public companies for women [who] are running them too.

Richie: [00:33:45] Venture investors. Where the money flows.

Ashley: [00:33:47] Exactly. So, from my standpoint, I’ve always been motivated around proving that we can do this. We’re a company that, by virtue of our product and the culture, we’re a very pro-women company. I think core to our mission has always been making women’s lives better. Product is a piece of that story. And what we’re doing here—we host a lot of women-centric events, but that is all part of what we’re trying to do here. It all comes down to product. At the end of the day, that’s really what it comes down to. But we have all the things that you need to make a big, successful company and we intend to do it.

Richie: [00:34:20] What’s been the cheapest and most expensive lesson you’ve learned building the company?

Ashley: [00:34:24] Oh my gosh. I would say product has been expensive, but I don’t know if there was any other way to do it, unfortunately. Even looking back, I don’t really have a totally better plan for that. So product because I think you can never undervalue how important it is if you’re quality versus a cost-based business. We are selling quality. I know that our pieces are an investment. So, in that knowledge, I feel an incredible responsibility to deliver. And so we’ve made a lot of product mistakes that we’ve had to eat. We see something that doesn’t meet our standards and that stuff’s expensive.

Ashley: [00:34:58] So I’d say that the cheapest mistake—we make those all the time. Actually, as a company, we’ve tried to institutionalize that as something we do on purpose. Because I look at it and think, “We’re in a new sector, really. It’s not like there’s a lot of sleepwear going on out there. We’re creating the story and so there’s no guidebook for that. We’re in retail and ecommerce which is probably different this year than it was last year. So evolving and experimenting needs to be part of our DNA.” And so institutionalizing that as a culture has been something that is very important. Now, one of the things we try to talk about is, “How do you fail small?” I try to coach the team through that. “Okay, great. I love that idea. What is the cheapest way we could test if that works?” I’m proud to say we do that a lot.

Richie: [00:35:40] What do you think could go wrong as you build this out?

Ashley: [00:35:43] I mean everything can go wrong.

Richie: [00:35:44] And/or what keeps you up at night, business-wise?

Ashley: [00:35:47] People keep me up at night. People are the hardest part and the best part of the business. I’ve met people [who] I think are incredibly natural leaders. I feel like they intuitively know what to do. I don’t think I’m that person. Business strategy comes very natural to me. But the people thing—with my long relationships that I’ve had with some of our employees, I value it so highly, but it’s so nuanced. There’s no guidebook for your relationship with each individual person. And also, it’s funny, but because I’m such a more analytical person, trusting my gut is something I’ve had to learn actually. So I sometimes would hire people, but I would have this feeling, a little bit like something was off about them from a team culture standpoint or what we want to do, but I would let my logic override it. I’d be like, “Well, everybody else in the room said they’re great and I trust them” or “But their résumé.” And I’m learning not to do that. There’s something about this natural intuition that you have that tells you and you shouldn’t ignore it and I’m working on that.

Richie: [00:36:48] What do you think is the most misunderstood thing about the company from the customer perspective or something you wish they could or would or, at some point, better understand, given all you know that goes into everything?

Ashley: [00:36:58] I would say cost. People—we get a lot of comments on, “I can’t believe how much you’re charging.” The fashion industry is a very misunderstood industry. It’s related to some even broader economic changes and things have gone on. But if I were to back up for a second and say, “You’ve got a lot of cheap clothing out there.” And it’s related to this disposable way of looking at things which I’m not a fan of. I’m not a fan of it environmentally but I’m also not a fan of it because I’ve seen what the labor force looks like that’s going into that. And I’d say you can get things made cheap but if you were to just think about those expensive purchases that you have and you think through the fact that someone had to pay for fabric. They had to pay for shipping. They had to pay taxes on that. They had to pay a full team to do development production on that. And then you had to pay the labor to sew that product. If you really think through all the pieces and you’re like, “Wow, I’m buying a shirt that’s $9″—you should question it. I love [the show] “The True Cost”—I don’t know if you’ve seen that. But it talks about some of the dangers of thinking about clothing in a disposable way. Thinking about anything in a disposable way can be dangerous, but thinking about clothing in a disposable way—we think we’re donating clothes and they’re not. I think it’s 10% of it gets donated even when you donate it.

Richie: [00:38:16] Most is in landfills.

Ashley: [00:38:17] Landfill. Exactly. There [are] a lot of chemicals and it’s breaking down and all this. So you have this element of it but then really thinking about who’s making those clothes if you care about that piece of the equation. I think it’s just worth that piece. But also I’ve never positioned us as a company that is a great deal. That’s not the problem we’re solving. We’re solving quality. How do we make your life better through products that are going to be lasting for you and they’re going to be transformative in how you feel and how you sleep? I know it’s an investment and so that’s why I take the quality piece real serious.

Richie: [00:38:50] What are you looking forward to most one, two, three years out?

Ashley: [00:38:53] Bigger team which is probably ironic given I told you [that] the people is the most challenging thing. But I am because I know the power of people. And so that I’m excited about. I feel like we’ve built this incredible foundation. We have product that we’re so proud of. We have a brand that’s really taking shape. I can’t wait to see what we do with it.

Richie: [00:39:12] And where’s the name from?

Ashley: [00:39:14] So, when I was trying to come up with a name early on, I started thinking of all the things I wanted it to stand for, to evoke. Calm, sleep, relaxing all these words were on the table. I also wanted a word that I could protect from an IP standpoint, that I could have the URL and all this. There was a word that I found that was a Swedish word, I think, and it was L-U-G-N-A. There is a pronunciation button on Google and so it pronounced it and, pronouncing it, it sounded like “lunya.” I was like, “Wow, it’s a beautiful word,” but when you give that word to an American they say “lug-na” which is the opposite of a beautiful word. What’s neat about “lunya” is it also is like luna—moon. How cool—we’ll create this word that is pulling from different cultures and different languages, but they all come together to be words that relate very closely to sleep and calm and that sort of thing.

Richie: [00:40:04] How much was the domain?

Ashley: [00:40:05] Well I can tell you a funny story about the domain. So we’re Lunya.co, as you probably saw that. There [are] very interesting squatter laws and so I figured getting Lunya.com would be no problem because there was no site up on Lunya.com, but I couldn’t get the guy to respond to me. So I bought Lunya.co and I put up a website, but I emailed the guy and, eventually, he responded and I said, “I’d love to buy the Lunya.com.” And I think he said it was gonna be a quarter of a million dollars. But I already owned the trademark at this point so I’m like, “Who’s gonna buy the word Lunya?” And so I was talking to an attorney and they’re like, “Well, you own the trademark and he’s not using it. So you actually have the right to buy it from him.” And I was like, “Okay, awesome.” The loophole is if it’s for a nonprofit organization then you don’t have the right is basically what it came down to. So the guy duplicated my site. Literally colors, font, everything. It was like the most audacious thing I’d ever seen. But then he put copy for an old nonprofit that existed. He was basically trying to force me into a position where I had to pay him a lot of money. But my background was in online media and I saw what was happening. I’m like, look, there’s only a limited number of .coms. And so the world is going to have to start accepting other things—.co, whatever. I believed that it was decreasingly important to have .com because people are now familiar with typing in in a search. In early days, they weren’t. You really had to have the right URL. But our customer is sophisticated. They use the Internet. So I was like, if ultimately they pull up this nonprofit, they’re gonna know that’s not me. And, over time, because this is a dead site that he’s creating, I’m going to SEO way in front of him. And so that’s what happened. And so we embraced .co and I never talked to the guy again because I was like, “Whatever. Here we are. It’s fine.”

Richie: [00:41:53] Yeah. Awesome. Thanks so much for talking.

Ashley: [00:41:54] Thank you. It was great chatting.

Richie: [00:41:59] Thanks for listening to the Loose Threads Podcast. You can read full transcripts of the podcast and join the newsletter at LooseThreads.com. Feel free to also leave a review on iTunes. We always appreciate it. And thanks to George Drake Jr. for editing this episode. We have a great roster of upcoming guests, including Michelle Toney and Stephanie Cleary of Morrow Soft Goods, Holly McWhorter of Plant Apothecary and Ariane Goldman of Hatch. Thanks for listening and talk to you soon.