Seven Dreamers
Sheen Sakane holds a PhD in chemistry and biochemistry from the University of Delaware and founded Seven Dreamers in 2011. Sakane describes the company as building technologies "the world has never seen." The company's products span unrelated categories, and Sakane said they came from identifying needs people "really, really want": a better golf game for players, and relief for the many people suffering from snoring and sleep apnea.
The first product was a fully automated carbon fiber golf shaft, launched in March 2014. Sakane explained that the shaft is made without grinding or painting the surface, so it has a true carbon look. Customers measure their swing, and the company designs a custom carbon fiber composite, taking about two weeks to produce. The most popular model sells for $1,800, and the golf shaft business was described as growing about 170% per year. The company also sells a one-day disposable nasal airway device for sleep apnea and snoring, which became the larger seller.
The company's largest development effort was the Landroid, a laundry-folding robot. Sakane said the company started developing it in 2005 and has spent over $15 million on its product development. Sakane described the approach: the company analyzes market size, potential share, and development cost, and forms a team only if the product is feasible.
Sakane did not describe a specific first-customer story. The company grew through its own branding, retail stores, and web and digital marketing. For the nasal airway product, Sakane said the company spends heavily on digital advertising, naming Google, YouTube, and Facebook. For golf shafts, the company sponsors professional players who use its products. Sakane said some months the company spends close to $1 million on marketing, sometimes spending most of its revenue.
The nasal airway product became the main driver of growth, with sales described as over $1 million per month. The golf shaft business also grew strongly. The company sold more than 400 shafts per month and had a limited number of top-end models: more than 10 at the $120,000 price point, and about 100 of a $15,000 model.
Sakane said there are no supply chain synergies between the three businesses, which operate with different supply chains and technologies. That lack of overlap means each product line has to be built and scaled separately.
The company reported about $35 million in consolidated sales for 2016 on its Japan fiscal year and set a 2017 goal of about $80 million. It had raised over $75 million in total, including a round of about $60 million closed in October 2016. The team is about 110 people, mainly in Tokyo with some in San Francisco. In January 2017, the host estimated combined monthly revenue of about $1.5 million. The company was preparing to launch the Landroid in a limited run of about 100 units at around $15,000 each.
- •A nasal airway device that sells as a one-day disposable creates recurring purchase demand, which helps explain why it became the largest revenue line.
- •Heavy digital advertising on Google, YouTube, and Facebook scaled the consumer product quickly, showing paid acquisition can work for high-volume hardware.
- •Automating custom golf shaft production and avoiding painting and grinding gave the company lower production costs than typical golf club manufacturing, supporting strong margins at premium prices.
- •Serving distinct, unmet needs in separate markets, from golfers to sleep apnea sufferers, allowed the company to build several product lines rather than depend on one.
- 1.Identify a specific, underserved need where customers already want a better solution, then validate market size and cost before committing to R&D.
- 2.Build a product that can be customized or produced automatically, so each order does not require expensive manual work.
- 3.Pair a consumer-facing product with a repeatable consumable or disposable so customers return to buy again.
- 4.Test digital advertising channels such as Google, YouTube, and Facebook, and scale spend only on the channels that drive sales for the product.
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