After living 20 years in an ashram, a scandal caused Michael Penny to start over and create a new life for himself selling organic mattresses.
Company: Savvy Rest
2013 Inc. 5000 Rank: 3593
Headquarters: Charlottesville, VA
Year Founded: 2006
2012 Revenue: $5.6 million
3-Year Growth: 84%
Michael Penny had never been interested in business. For two decades, he lived in an ashram, a secluded spiritual compound in which he practiced yoga and sought purity and simplicity. But when a scandal rocked his community, Penny was forced to reevaluate his life. He moved out and started over. At age 41, with little money and no formal work experience, Penny struggled to support his family. He eventually found a new path to fulfillment by launching Savvy Rest, a Charlottesville, Virginia, maker of organic mattresses. His products are sold by dealers across the country.
I took my first meditation course when I was in college. It felt so good. I felt relieved and centered. Meditation got me away from everything everybody else was doing, which back in the '70s was drinking and smoking pot. I majored in psychology, because I was interested in helping people. I didn't want to have anything to do with the business world.
Usually people strive for money, power, fame, or sex. I didn't see myself becoming fulfilled by any of those things. I graduated college in 1975 and moved into an ashram in Pennsylvania. I don't know if it was just anxiety about stepping into the world or an inability to make a decision, but I felt like I really wanted to experience going deeper within myself and having a deeper experience with yoga.
The ashram was demanding in a lot of ways, but to me it felt like home. We woke up every day at 4:30 a.m. We dressed in white and practiced yoga, meditation, breathing exercises, and chanting. We all had jobs within the community, which grew from a group of 70 to hundreds of people. My jobs ranged from bookkeeping to managing the kitchen. I was a good yoga teacher.
We lived very simply. The ashram provided a small allowance as well as food and clothing. Everyone shared the common understanding that we were spiritual seekers on a path of enlightenment and self-discovery.
While living there, I met my wife, Heather. We married in 1982 and had two sons, Gopal and Santosh. We felt we had found what we were looking for. We planned on staying in the ashram for the rest of our lives. But in 1994, everything changed. It came out that our guru had been sexually abusive with some of the women who lived there.
We didn't understand how we could have allowed ourselves to be so misled. We wanted a clean break, so we picked up and moved to Virginia. We didn't know who we were separate from our life in the ashram. But I believed we would land on our feet. We were willing to work hard. And we had lived for so long on nothing that we had nothing to lose. I think we were overconfident.
We had enough money for a few months' rent. I believed that the universe would provide for us. My wife worked as a massage therapist. I took the first job offer I got, which was selling satellite dishes. I said to my wife, "Well, it must be meant to be. I'm supposed to sell satellite dishes." I lasted only three weeks. I was awful at it—I hadn't watched television in 20 years!
I needed to make a living. I worked for a while at a senior center and then delivered newspapers for a few months. I just did whatever I had to do. It was overwhelming emotionally, but I didn't have time to process all of that.
Eventually, I got a job from someone who had lived in the ashram. He had a futon store, and he needed a manager. He wasn't a very organized person, but I was. I worked at the futon store for about six years.
In 2003, I decided to start my own mattress store, the Savvy Sleeper. People were constantly coming in asking for all-natural mattresses. I tried a few different kinds, and they tended to be either really hard or really soft. They just weren't good-quality products.
I met with a natural latex manufacturer from India, and we began manufacturing organic latex mattresses. Today, we have about 60 dealers and 15 employees. My youngest son works in our warehouse part time, and my older son handles our website and marketing.
When you have a need for something—whatever it is—then you put more energy into it. In this case, I had a personal need for my company to be successful. Sometimes, people say you create your own reality or that if you believe in something hard enough, you can make things happen. I think there's some truth in that. But I also think there are a lot of forces at work, like grace and luck.
After living in the ashram, I believe that I know how to listen to what my customers need on a deeper level. For example, I've learned that trying out a mattress in a store for a few minutes isn't a good-enough test. That's partly because of the nature of the situation. The customer testing out the mattress is often stressed—and often hovered over by a salesperson on commission. The customer is usually wearing constrictive clothing and feeling muscle tension from the day.
We designed our mattress in layers. Each layer can be firm, medium, or soft, and there are many possible combinations. If a customer doesn't like what she chose the first time, she can swap layers for 90 days. For example, she could exchange a firm layer for a soft one. Sleeping on a mattress for a few weeks is the real test. We've made it so people can do that in their home, where they feel most comfortable. About 10 to 12 percent of our customers will do an exchange; for the rest, it's comfort and relief that feels right from the get-go.
When I started my business, I wanted to create an environment that was safe, warm, and inviting to everyone, including employees, suppliers, dealers, and customers. I always tell every new employee that all customers must feel safe, warm, and welcomed. I'm not particularly demanding about anything else.
From shocking marketing campaigns to mastering social media, the fastest growing companies on the Inc. 500 share the secrets to their rapid growth.