Toward the back of an unmarked loft space in San Francisco’s Potrero Hill, James Proud is pacing. For the first time since we met six months earlier, he looks tired. At 23, he’s a squat bruiser of an entrepreneur with a blond crewcut, wrestlers’ shoulders, and today, shadows beneath his eyes. I ask him how he’s sleeping. “Fine,” he says in his clipped South London accent. “You know, like a founder who is about to ship his first product.”
That product, which is called Sense, is an orb-like sleep monitor the size of a baseball. It receives signals from a sensor attached to your pillowcase to tell you seemingly everything you might ever need to know about how well you are sleeping and why. Proud has been testing it personally for several months, and last night it gave him a sleep score of 77 out of 100, which is not bad considering circumstances, but will probably get a lot better once the first batch of monitors are mailed to customers on February 24.
For now, he’s just repeating the company’s mantra to the 20 or so engineers and designers he employs: “Get shit done. Make it perfect. No crying.”
Proud is the product of a new era of tech entrepreneurship in which young people are given the tools and encouragement to skip college and start companies, and much of the most promising innovation is happening in hardware. Even five years ago, if he’d had the idea for Sense, he’d likely still be back home in London, developing it as a final project at a university. That was before the eccentric billionaire Peter Thiel began paying teen geniuses $100,000 to spend two years in a fellowship program in Silicon Valley, bringing their best ideas to life. And it was before 3-D printers and crowdfunding websites like Kickstarter made it possible for someone to sketch an idea out on a sheet of notebook paper and then deliver a finished product to more than 25,000 people in under a year.
Facebook’s vice president of partnerships, Dan Rose, compares this time to the early days of Web 2.0, when software entrepreneurs could first rent their computing services and didn’t need to build them from scratch. “Amazon Web Services fueled so much of the innovation that happened in software apps,” says Rose, who funds and advises Proud. “The same thing is happening with hardware companies,” he explains.
A member of the inaugural class of Thiel Fellows, Proud has raised nearly $13 million to fund his startup, which he named Hello. And so, at just the age that many gifted coders are finishing up college, Proud is losing sleep in a loft in Potrero Hill---and gaining a real world education in building hardware companies that will shape him into a formidable entrepreneur, even if consumers never quite wake up to Sense.
***
Proud grew up in a working class neighborhood in South London where he first logged onto the Internet via a dial-up connection when he was seven. From an early age, he was obsessed with technology. He taught himself how to code at nine, and started building websites by age 12. His hobby grew into a well-paying part-time job. His friend Steven France remembers spending long evenings with him in which they’d both be on their laptops. “My interests were in the next computer game and when it was coming out,” he said. “James would be building websites.”
Proud studied Silicon Valley’s entrepreneurs with all the zeal that others his age might devote to football heroes. He followed them on Twitter, read their books, and he took the tube across London to meet them in person at tech Meetups. That’s where angel investor Shakil Khan, a former adviser to Spotify and Path, first met him. “There was this young kid, younger than anyone else, up pitching his idea,” said Khan. “He took himself very seriously.” Back then, Proud was working on a music listings app he called GigLocator that helped music lovers find the concerts with their favorite artists and purchase tickets.
His big break came in 2010. He’d recently finished a two-year program similar to junior college in the US. He was living with his parents and keeping West Coast hours---eight hours behind---so he could better keep up with the entrepreneurs he admired while he worked on his app. One September night, he was streaming the live Webcast of Techcrunch Disrupt when he heard Peter Thiel announce a fellowship that would provide 20 teenagers $100,000 to pursue their entrepreneurial ideas. Thiel was looking for teenagers. Check. Who didn’t want to go to college. Check. And wanted to build companies instead. Check. Even before Thiel left the stage, Proud began emailing Khan, Spotify founder Daniel Ek, and anyone else he might have ever met, asking them to put in a good word for him.
He got the acceptance call the following April. The fellowship program wanted him to report to San Francisco in June. At first he was shocked---he knew that most of the finalists were attending Ivy League universities in the US. Then he grew impatient. Three months, it seemed, was a long time to wait. He had the equivalent of $300 in his savings---enough to buy a one-way ticket as far as New York. So he called back the program’s administrator. “I’m coming next week,” he told her.
“What will you do?” she asked. “Do you have enough money?”
“No, not yet,” he responded. The fellowship administrators arranged for him to start his work early.
Proud used the fellowship to develop and launch Giglocator. He also began to make important connections. He worked briefly for PayPal cofounder Max Levchin, who was then just starting to experiment with projects as part of his incubator, HVF. And Proud became the first fellow to sell his company. In 2012, he sold GigLocator to the concert promoter Peter Shapiro for an undisclosed six-figure sum. He kept enough to cover rent and invested the rest in Hello.
***
Proud wanted his startup’s first product to be a sleep and wellness band. When he recruited his team---led by designers and engineers from Foxconn and the aerospace industry, among other places---he sold them on the promise of a bracelet that would do a better job measuring sleep and general wellness than others on the market. But by the spring, Proud realized the product wouldn’t work. The market for bands---Jawbone’s Up, the Fitbit, the Nike FuelBand--was crowded, and with news of the upcoming release of Apple’s watch, about to become more so.
Over drinks with a friend one night, Proud came up with the idea of a different kind of sensor that didn’t require any work on the user’s part. “The problem with wearables is that you have to wear them,” Proud told me the first time we met last September, explaining that he wanted to make technology that actually disappeared. “It should just work for how people really live. You should be able to come home drunk at night and fall into bed without thinking about it, and it should work.”
He took each of his top lieutenants out to dinner and pitched them on the new product. Within the week, the entire team had agreed to abandon 18 months’ worth of prototyping and start over. “If he hadn’t made the pivot, the company never would have survived,” says Rose, who has just become Hello’s first board member.
By summer, Proud’s team had designed a new prototype, which they’d printed in the Stratasys Objet30 3-D printer kept behind glass doors on the second floor of the loft. Modeled after the Bird’s Nest stadium built for the 2008 Olympic games in Beijing, the fist-size sleep monitor is loaded with sensors that scan a bedroom for noise, light, temperature, and particles in the air. It communicates via Bluetooth with a “sleep pill,” a quarter-size sensor that clips to the pillow and detects movement to indicate how soundly you are sleeping. An alarm wakes the sleeper up at the optimum point in a sleep cycle. All of this information is revealed on and programed from a smartphone app.
To test the market, Proud posted a video to Kickstarter, requesting $100,000. He collected more than $2.4 million and 25,000 preorders. It was enough to suggest that consumers were interested---and enough to convince Chinese manufacturers to work with Proud to produce the device. “We were able to go to them and say, ‘we have this many people who will pay us this much money to buy this,” said Proud. “We were lucky enough to find a manufacturing partner who moved really fast.”
Less than seven months later, the office is littered with boxes that hold the packaging for the Sense devices. Four of Hello’s lead team members are battling jet lag, having just returned from spending nearly a month overseeing production in China. They’ll go back to the factory next week. The product, however, is about to ship.
***
My partner and I have been testing Sense now for nearly a week. It arrived in cylindrical packaging that mimicked Apple’s elegant white perfection. The product, which retails for $129, is both beautiful and intuitive. But so far, it works rather like it was designed for a 23-year-old guy who sleeps mostly by himself.
Some of this has to do with the hardware. Both my partner and I have sleep pills attached to our pillows that sync to our phones, but neither is labeled. As we make the bed each morning, we invariably throw the pillows back on haphazardly, and already, we’ve accidentally switched sensors so that her signals are being fed to my phone. It’s a problem I’ve solved temporarily with a permanent magic marker.
Then there’s the data itself. Sense has told us useful things--after finding that the air in our bedroom during this East Coast winter has less moisture in it than the Sahara desert, we bought a humidifier. But it hasn’t always accurately recorded the times that we fall asleep or wake up, and it appears to confuse my motion with my partner’s. I ask Proud about this during my office visit. “It’s not perfect yet,” he tells me. “I think most people expect that when it’s a Kickstarter project, it’s a work in progress.”
The sleep pills determine when you are snoozing and how well by detecting motion. What if a cat walks across your pillow? What if you roll onto your partner’s pillow or, during a restless night, your pillow falls on the floor? These are the hardest problems to solve for, but also the most interesting. As Sense picks up more data, it will become better at filtering the signal from the noise, Proud assures me. Right now, only a hundred or so devices are feeding data to Hello’s engineers. (In aggregate, of course. Personal data is kept private.) Proud is betting the experience will improve greatly once tens of thousands of people are using the device, and Proud’s engineers will be able to tweak their algorithms to adjust for pets, pillow drops and other erratic movements.
A few days later, he sends me an email telling me that after I left, he asked his best mathematician to look into the inaccuracies I mentioned. “After working non-stop on this the past few days, we're preparing to push out two major changes to our algorithms,” he writes. He is both humble---accepting responsibility for the flaws---and seasoned, coming off as a founder who has already sold a company and won’t be emotionally capsized by the constant ups and downs of entrepreneurship.
It’s too soon to say whether Proud’s sleep monitor will develop into a credible success story. But it’s clear that James Proud already has.
