July 28

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Leading a Baby Tech Company with Female CEO Sarah Dorsett

By Mimi MacLean

July 28, 2022


FEMALE CEO
Sarah Dorsett

Sarah Dorsett, CEO of Nanit

Sarah Dorsett is a mom of three, an experienced eCommerce leader, and the founder of a rapidly growing tech company for new parents. Nanit was born out of the need to support the parenting journey with products that connect parents to their child’s development. Sarah used her experience in eCommerce to build a strong foundation for Nanit and it has helped the company not only grow rapidly but maintain company culture, steady sales, and strong customer loyalty.

Under Sarah's leadership, Nanit has been named to Fast Company's Most Innovative Companies, Deloitte Fast 500, and CNBC's Upstart 100 list of most promising startups. Tune in to learn more about what inspired Sarah to start Nanit, her tips for mom entrepreneurs, and her tips for creating strong eCommerce in your business.

To Find More About Sarah and Nanit:

LISTEN TO THE FULL EPISODE HERE

Episode Directory

Her Transition from Corporate America to Female CEO

Mimi MacLean:
Sarah, thank you so much for coming on today. I really appreciate your time. You had some amazing jobs in Corporate America. I would love to just start out by talking about like your transition from Corporate America to deciding, "Okay, I have this idea. I'm going to jump and do my own thing," because that's a big leap for a lot of people to do. I would love to just walk through what you were thinking and how you actually did that?

Sarah Dorsett:
Well, first, thank you so much for having me. I love to talk about that transition because you're right, it's not exactly easy. One thing I should probably clarify is that I'm not the actual original founder of Nanit. I came in to really drive the business. Once the product was created, I was brought in to build the entire business side of the organization. Yes, my background is in Corporate America in most cases, but I would say that I was largely in a bit of an integrated incubator.

Sarah Dorsett:
That's kind of what I call it, because e-commerce in the businesses that I worked in was not established yet. I largely came in as the builder of this brand new thing called a website and an e-commerce business to a very… An organization that was entrenched in store culture and physical stores and all of the things that are built around that legendary experience of building a store and making it so special and that one-to-one engagement with customers.

Sarah Dorsett:
And then I would come into a retail business like Bloomingdale's or Century 21 Department Stores and everyone would say, "I don't know what this e-commerce thing is." I largely was almost a startup within a larger organization in many cases. When I came to Nanit, it felt actually very comfortable to come into this and say, "Okay, well, I'm really building again." I think that experience has actually made the landing a little softer for me than if I were to just kind of branch out on my own.

Mimi MacLean:
Where was Nanit at that point when you joined? Was it already selling and then you just kind of grew it, or was it kind of still in incubator phase?

Sarah Dorsett:
It was not officially pre-market. They sort of just launched the product and they had started to work out some of the kinks for that product. The business was very, very small. The distribution channels were very small. It was largely just B to C and maybe a few wholesale channels that they were dipping their toe into. There were still product challenges to work through so that the camera was still being iterated on a little bit at the time.

Sarah Dorsett:
When I walked in, they were just about to launch a better version of the camera so that it solved a lot of the problems that the first version had. It was very much like a new to market product, I would say, when I walked in.

Mimi MacLean:
Do you mind me going back to like your experience at Bloomingdale's? How did you know? Because we were talking briefly before because we both worked at Bloomingdale's and you kind of ran the e-commerce. Where did you get your experience from for that? Because it was so new, I always wondered like, okay, where did the person who runs e-commerce come from, because there was no e-commerce? You learn under fire?

Sarah Dorsett:
I'm so lucky because back then, you're right, no one had an e-commerce experience. It was learn as you go. All of the companies I worked in before Bloomingdale's, I had always been given the website. It wasn't really important to the business. It wasn't really an e-commerce business, but I have a technical background from childhood. My father's in engineering and he was in programming. I was more of an artist than anything else, I think. Kind of that combination of engineering, art and science is what I always…

Sarah Dorsett:
I think why my passion for e-commerce started to grow and why I just kind of fell into the right job. But my previous jobs leading up to Bloomingdale's were, "Okay, Sarah, do all this kind of like integrated marketing type of thing," much more visionary, innovative stuff, but you'll always have the website because the website is where all of that integration can happen and that sort of two way dialogue can happen. It's such an immersive medium.

Sarah Dorsett:
I was just playing with websites for years for companies like Cody and Estee Lauder and Frédéric Fekkai, all these beauty brands. Ultimately that organically grew because I was the only one touching it. I learned how to do marketing. I learned how to build the website. I learned how to work with engineers. I learned how to run sort of Q and A and launch websites, and I just learned everything about how an e-commerce website worked.

Sarah Dorsett:
By the time I got to Bloomingdale's, I was already pretty experienced, but not very many people were actually given that opportunity. A lot of people thought that websites at the time, if you had a web person or somebody dedicated to e-commerce, it was usually just one person. Back then, you would have one person would have a ton of experience. And then as my career started to grow, I started to notice there was a lot of specializing.

Sarah Dorsett:
Now people have specific experience in different types of digital marketing like SEO, specifically social media. Everybody's very, very… No, there's not a lot of opportunity to get the type of experience that I got.

Mimi MacLean:
Right. Back then, it was almost like also a pamphlet, right? It was like a pamphlet online. It was information portal. When I graduated from business school, my idea was to try to get e-commerce on there. I remember going around retailers being like, "Don't you want to sell your stuff online," and trying to convince them. They were like, "What are you talking about? No. How would it get to their door?" I don't even think FedEx was even that popular back then, right. I mean, it just delivered things overnight.

What Exactly is Nanit and Their Female CEO ‘s View on the Industry

Mimi MacLean:
It wasn't for business people. It wasn't like a normal portal for sending packages for Rue La La. But it's funny because in such a short time, it's gone crazy. Let's get back to Nanit. You joined there. Can you just tell everybody like what the product is, because it's actually really cool and innovative and it's kind of changing the landscape for new parents?

Sarah Dorsett:
Nanit today is a platform, but the entry point to the platform is the world's smartest camera. It's a camera that kind of does processing and thinking for parents, because it's built on a foundation of computer vision technology, which essentially can help parents see what they normally wouldn't. If you think of the camera itself, I always like to say it's sort of like the lens of your eye is connected to the CPU of the camera.

Sarah Dorsett:
Those two things working together process information based on what the camera is ingesting from the crib. It sees kind of how the baby is doing and how long they're sleeping and when they wake up and when they put themselves back to sleep and how often the parents are coming in. It can see all of the activity going on in the crib, from rolling over to smiling, to talking. Ultimately, it packages up all of that information and helps parents not only understand it, but also learn how to use it.

Sarah Dorsett:
Today, there's an entire sleep training program that's triggered by an individual family's activity in a baby's development. But in addition to that, we're able to build products, that's why it's a platform, we're able to build products off of the camera itself that tie into the experience. We've built or we've created baby sleepwear that has just a simple pattern printed on the chest of the sleepwear, but the technology is so smart that it knows what that pattern looks like.

Sarah Dorsett:
It knows that it can track the movement of that pattern. If it's printed on a baby's chest, we can now tell you whether your baby is breathing regularly or not. Same with sheets. We take almost everyday items that have been around forever that babies and parents love and give them a little bit of extra innovation. We have just… Again, there's actually no electronics on anything, which is really nice, just the vision text. We have sheets for the crib that have patterns printed on them.

Sarah Dorsett:
The camera can recognize those patterns as calibration targets. Again, it's just for the camera can see, calibrate the size of that sheet. So that anything that you put in between those targets, the camera can measure. The camera can now measure your baby every single day if you'd like to see how they're growing, because we all know babies are growing like crazy. We can do that with just about any product. You can build anything off of it, and then you can kind of tell your camera to go and learn about it.

Sarah Dorsett:
That's kind of what we're doing. And then we have such an incredibly engaged audience because so many people are engaged in our app and in our community and it becomes a daily part of their life. The entire family becomes connected using Nanit. That engagement has created an incredible feedback loop for us. They're constantly engaging with us. We can ask our parents almost anything and they'll talk back to us. It's a pretty incredible brand experience.

Sarah Dorsett:
Very different if you compare it to my e-commerce past, which was very transactional, right? You bought your dress and now I don't know who you are and I don't know what you did with it. I don't know whether you liked it, you didn't like it, what you want to purchase next. With Nanit, we wait for the customers to tell us. It's this really lovely place where you get to keep your data. It's safe. It's protected. It's yours.

Sarah Dorsett:
But because you're here with us every single day, we leave the door open for your questions, your concerns, your recommendations, your advice, and then we try to answer in the most innovative way possible.

Mimi MacLean:
Great. You were saying it's not electrical, so it's safe for the baby. It's not like they're wearing like a device that's talking like wirelessly to it or anything.

Sarah Dorsett:
Yep. The products are just… We can build just about any or we can create just about any product that already exists today and the camera can do something with it. It can watch something happen. It can watch the baby develop. if you think about something like a play mat, we've all used play mats for our babies, the camera eventually… This is on our roadmap.

Sarah Dorsett:
The camera could see the types of things that your baby's engaging with and make recommendations. "Okay, your baby's kind of bored with that one, doesn't like this one. Maybe it's time to change out this." See how long baby's been on their tummy, or maybe even on one side of their head and alert you to time to make a change time, to make a shift. Baby's been on their tummy for five minutes now, so you' re done for the day, mom.

Sarah Dorsett:
There's all these amazing things that the cam… The camera is so smart. It can be trained, the camera itself can be trained. We train it to do all of these kind of amazing things. That's what's possible with Nanit.

Possible Early Intervention and How Nanit Was Built on an Academically Supported Foundation

Nanit’s Interface

Mimi MacLean:
Would be able to like in the future be able to be like, "Okay, your child may have autistic tendencies," or something like that, where you trigger… Because it's like all those type of issues, earlier the intervention, the better, right? If a parent has to wait until you go to a pediatrician or into kindergarten or nursery school for the teacher to flag that, whereas if you could say to them like, "Wait a second. They're little lagging on lifting their head," or whatever typical symptoms are.

Sarah Dorsett:
My favorite thing about talking to moms like yourself is they pick up on that right away, and that's exactly what I picked up on when I came in and met the founders of this company, because the foundation was this information is so incredibly valuable to child development and child wellness. Today, the company was actually built on an academic scientific foundation.

Sarah Dorsett:
There was a huge partnership with sleep research and pediatric sleep experts all over the world who helped define kind of the sleep approach and what do you need to track and what would be helpful for parents and how do you build it. But we always knew that this kind of human analytics idea would be incredibly valuable to the scientific and medical community, as well as just to parents.

Sarah Dorsett:
Wouldn't it be great if you knew something or you knew you were headed in a direction and you could get in front of it? Today, we ask our parents, some of them… Actually everyone, but we have quite a huge set of parents who agree to have their anonymized data used in clinical trials, which we partner with various researched institutions and scientists all over the world today on studies around early detection of autism, like you said, on sleep apnea, on how sleep impacts child development, because we know it impacts us as adults.

Sarah Dorsett:
But can you imagine, you're developing at a crazy rate as a child. Sleep is probably a hundred times more important and has such a huge impact when your body is developing and your brain is developing so much faster at such an incredible rate. For us, we're sort of the only ones who really know how to do that, how to lead those partnerships, and doctors and scientists value us because we see what they can't.

Sarah Dorsett:
The camera really helps them understand what's going on and gives them a point of reference so they can do studies at scale. Usually infant studies and child studies are hard to build because just recruiting a healthy child or a healthy baby to be studied in any meaningful way is incredibly difficult. You either have to ask parents to record everything they're doing and what parent has time to do that, or you have to have somebody watching the child, and that's hard to manage as well.

Sarah Dorsett:
You want your child to just live a happy normal life. Nanit is there to bridge that gap.

Mimi MacLean:
That's great. When you joined Nanit, looking back, what has been the most surprising obstacle or difficulty that you didn't expect?

Sarah Dorsett:
Well, I think for me what was amazing is the product itself parents just loved. I thought this has better product market fit than any product I've ever seen in the millions of products that I've sold. But one of the interesting obstacles I think for me was actually on the other side of the business when you think about more the investor community more so than anything else. The investor community tends to have heartburn around hardware, and that was the thing that I think was the most shocking.

Mimi MacLean:
Why is that?

Sarah Dorsett:
Hardware is cash intense. You have to produce it and you have to spend money on it. It's not the same as just hiring a bunch of engineers and developing kind of a software product, which is kind of the sexy version of investing. The biggest eyeopening thing for me was coming into a business that is an investor backed business, instead of working for a corporation where there's a different level of funding maybe you could say.

Sarah Dorsett:
And kind of getting over this idea that this was a physical product that could do incredible things, but the fact that it had to be kind of built and constructed and you had to invest in the product itself, I think I'm still a little surprised that there's any anxiety around that side of the business.

Additional Funding and the Support Investors Gave Nanit While It Was Rapidly Growing

Mimi MacLean:
Did it have funding when you arrived it, or you just needed additional funding?

Sarah Dorsett:
No, we have incredible investors. It had funding, and it still does. It still does have great funding. I was just surprised. It just sort of surprised me that there wasn't more of a love for hardware.

Mimi MacLean:
Well, I think if it had like a subscription model attached to it. It's kind of like the Oura Ring, right? We bought the Oura Ring, or at least I bought it a couple years ago. It was expensive, a couple hundred dollars. You buy it, but now they've changed the… Now they've changed it because it was a free app before, but now they've switched. It's expensive. It's like $30 a month or something just to be able to use the app now to go along with your ring. I'm like, "Wow! That's crazy. That's like such a big difference," right?

Mimi MacLean:
It's like that whole model, that's what they want. They want you to be able to invest. It seems the same thing with the bikes, right? It's not the bike. It's the $100 month that they're counting on. They love the subscription model. You don't have a subscription model, do you?

Sarah Dorsett:
We do. We have a huge subscription model actually, but it's not that. That's what's so interesting is our subscription model I would consider to be very reasonable and it's always been there. When you buy a camera, the first year is free. It's included. I think it's a pretty light lift when you compare it to Peloton. It's $5 a month compared to $39 a month or $20 a month or anything like that. This is your child. This is your family, right?

Sarah Dorsett:
The only reason that subscription model is there is to help us build better and better features to help parents and because it's constantly streaming and it's collecting information. The camera just needs to run on a lot of power. That subscription model really helps the technological advancement of the business itself, which may be different from just kind of a straight revenue model that you might think of when you think of other hardware-software type of combos.

Sarah Dorsett:
I think ours, we've always tried to keep it very reasonable so that we could continue to add a lot of value around how unique and special this product is. But also being sensitive to the idea that parents have to spend money on a lot of stuff. Is this a really good investment or not?

Sarah Dorsett:
We think that because it stays with you for quite some time and you're learning about your child and maybe you're learning what things to spend your money on because of what you're seeing as your child develops, that this is probably a good long-term investment for you as a parent that can frankly help save you a lot of money in the end.

Sarah Dorsett:
Yeah, there's a lot of benefit to it, but that is the side of the business that is also really, I think, attractive is having that model when it comes to hardware. But yeah, those are some of the things that were a little bit more surprising to me.

Mimi MacLean:
Right. No, definitely, I could see that. I would see why that would be the case. I guess my next question is once you were there, you were trying to grow it. You said there was only a little bit direct to consumer. At that point, I mean, I would assume because you came from Bed Bath and Beyond, you knew who to call, you knew who the buyer was.

Sarah Dorsett:
I did. I did, but I also had a sales… There was a salesperson, bless her heart, she's still our head of sales in the company, who also had a lot of the same relationships that I had. It was really nice to walk into an organization and say, "Oh yeah, we know so and so, and so and so. Let's go and talk to them." It was very easy for her to really build out those sales channels for us pretty quickly. We stayed hyperfocused on the channels that we knew because we knew how successful they could be.

Sarah Dorsett:
We knew all the rules of engagement, if you will. It was really nice because she had the relationships and she knew kind of how the whole… All of their business models worked. And then I had the e-commerce experience, so I knew how to really help. A lot of companies want to bring on a new product, but they want to start with e-com first. It's harder to bring that product into their stores and get it set up on a shelf.

Sarah Dorsett:
They tested online first and I was able to come in and help bring some of that experience too. The combination helped us quickly get distribution in very big channels.

Biggest Growing Pain Point for Nanit – Speed

Mimi MacLean:
What do you see as your biggest growing pain at this point?

Sarah Dorsett:
Speed.

Mimi MacLean:
Speed of like growing or actually the product, getting the product?

Sarah Dorsett:
Getting more and more features. At this point, we have so much scale and we can do so much. Like I kind of mentioned, we can build almost anything. We can create digital experiences for parents that are almost mind-blowing that no one's ever really thought of. It's just delivering those things as fast as we can. That's what keeps me up at night. It's the amount of choices and the opportunity that this brand has to help families. I want it all done yesterday because you can see it right there.

Mimi MacLean:
Yeah. I mean, I would also think that like trying to figure out how to keep your customers, right? Because they probably think, okay, it's a baby camera. Once they're out of the crib, do you lose them as customers? Or is there a way to keep them through the life cycle of them into elementary school?

Sarah Dorsett:
What we've seen is that our parents actually do get very… They're so engaged with the experience. I think they spend about four hours a day in the camera and it's mom, dad, and sometimes even grandparents and caregivers. They're not quick to give it up once baby leaves the crib. It's also portable. It actually pops off the kind of crib mount and you can turn it into a bit of almost like a nest, if you think about it. It can be very, very portable.

Sarah Dorsett:
In fact, the travel case and the things that we do to make it portable are also extremely popular. What we see is that families don't necessarily want to give it up, which we think is great, and they have more than one child pretty quickly. They're keeping their Nanit as additional babies are born and families are growing. What I like to recommend is that parents continue to use it at the very least for sleep, because we are constantly introducing new features for different ages of the child.

Sarah Dorsett:
We've got first year pretty much covered. We've got year two is kicked off in pretty strong. Year three and year two look alike in many ways, but we are definitely growing the digital offering well past kind of the crib stage. But understanding your child's sleep as they get more active. Sometimes for me is I have a hard time balancing. Is it more important to do it then even than before?

Sarah Dorsett:
I know we want to get our kids sleeping and we want to get them into these healthy patterns, but I also want to know if they will have a better day if they sleep better, or if they will be happier with the… If they will be more excited or more engaged in the activities that they like or able to even process information easier and not kind of melt down if they have a certain amount of sleep.

Sarah Dorsett:
I really encourage parents to continue to use the camera for sleep tracking and really pay attention to their day and what their sleep data is telling them.

Mimi MacLean:
What size pajamas do you go up to?

Sarah Dorsett:
They go up to two years.

Mimi MacLean:
You need pajamas that go up to like toddler and six and seven, right? I have a daughter who we've put her in… She's seven and she's had some sleep studies, which is very traumatic to take him to a sleep study place. That I wish I could have just been like, "Okay, I'll buy this instead." But still to this day, she's got sleep issues. I'm like, "Ooh." Do you have other sheets that are not crib size, that are queen or twin or pajamas that I could put her in or a mat or something?

Sarah Dorsett:
Well, the sleep just happens on the camera. You only need the camera for sleep. The apparel is for breathing today and the sheets are for measuring growth. Those are definitely more for stages of development, but the camera is really designed for sleep. You only need the camera. You can put the camera over a bed, or you can put it over a toddler bed, or you can put it over the crib. You can put it wherever you want it, but yeah, it can really help you understand what's going on with their sleep patterns.

You Have To be Ready To Take Leaps and Be In What Sarah Calls “High Rev Mode”

Mimi MacLean:
That's great. Just to close up, do you have any advice for any woman that is looking to leave their company and go to a startup? There's obviously risk to going to a startup and leaving a big corporate job, and then also running a startup as a CEO, advice to that as well.

Sarah Dorsett:
Well, I highly recommend it. The only thing that I would say, it really depends on who you are. In my case, I love building things. I tend to rev a little higher. I like to work at a fast pace. I like to constantly be discovering and creating. I think if your mindset is sort of in that mode and you're okay with taking a bit of a leap of faith and kind of trusting yourself and seeing how far you can push yourself, then moving into the startup world is phenomenally rewarding from that respect.

Sarah Dorsett:
I absolutely encourage it. I also encourage women to do it. It doesn't have to be forever. You can take a break from that corporate world for a couple of years and not completely destroy your career. You can go out there and take that risk. But if it doesn't work out for you and if it's not the right thing for you, it's not going to show up as a bad choice. It actually oftentimes makes you look like somebody who is willing to take a chance and dive into something new and experience the unknown a little bit.

Sarah Dorsett:
I think it's a very healthy move if you can kind of set yourself up financially to do it, because sometimes there is a shift there that you need to be aware of. There's not as much of a safety net, I would say, in the startup world. As a CEO, oh my goodness, I think that's one of those things where you have to really trust yourself quite a bit. When you move into the CEO role, you have to be willing to lean into your gut a little bit. I think that was something that I had to really…

Sarah Dorsett:
I think I was able to safely make a lot of sort of instinctive decisions when I was in more of the corporate world. And then when I became a CEO, I think I thought, "Ooh, is that the best thing to do anymore? Now I'm a CEO. I shouldn't drag all these people behind me because my instinct tells me I should do this thing." But more and more, I started to realize that was actually what made me successful when I was in the corporate world. You really I think have to kind of lean into your experiences when you become a CEO.

Sarah Dorsett:
No matter what they are, they're super, super helpful. And then be very open to learning and absorbing information, especially in a sort of high growth tech-based company. There's so many opportunities to learn. Don't be afraid to reach out. There's a lot of people who want to help you and give you advice and work through problems together. Those are my two pieces of advice.

Mimi MacLean:
That's great. Thank you so much, Sarah. I really, really appreciate it. And then for anybody who's listening and wants to check out like where… I mean, I guess the best place is to go to your website to get a camera, or is it to go to like Amazon or Bed Bath and Beyond? It's Nanit, N-A-N-I-T, dot com, which I assume you can buy there. Yeah, you can. You could also probably get it at any of your favorite baby stores.

Sarah Dorsett:
Nanit.com is a great place to learn all about the brands and the products. You'll have the most information there. Our social channels will really help you understand kind of the personality and the things that we advocate for as very much a mission driven company. If you're starting a family and you want to add us to your baby registries, we're on all the big ones, so Amazon, Babylist, Buy Buy Baby, Walmart.

Mimi MacLean:
Great. Well, thank you so much. I really appreciate it.

Sarah Dorsett:
Thank you.

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