Building a sleep reference solution: we talk to Dreem CEO Hugo Mercier

In 2014, two students of France’s most prestigious engineering school, Ecole Polytechnique, embarked on an exciting new venture.

Inspired by recent discoveries in neuroscience, they formed a new sleep technology startup which, they hoped would build the world’s best consumer sleep wearable.

Four years later, the dorm-room project has expanded to 80 employees, secured over $60 million of investment, and boasts some of the world’s leading sleep experts as scientific advisors.

So, in a nascent and volatile sleep technology industry, littered with failed ventures, what exactly went right with Dreem?

I interviewed Dreem CEO Hugo Mercier at the commercial launch of their headband, so I caught up again with the co-founder via Skype to talk about the journey so far, the new Dreem Coach app, the Dreem library of audio-based therapeutic techniques, which the company hopes will position them to be the ‘reference solution for bad sleep’.

This interview has been edited for brevity and clarity. To learn more about Dreem, read our 2017 interview here.

Dreem, the elevator pitch

Jeff Mann (JM): To anyone who’s not aware, can you explain very briefly the concept behind Dreem and how it differs to other sleep products and technologies.

Hugo Mercier (HM):  The Dreem band is a headband to wear at night measuring your physiological activity, meaning heart rate, breathing frequency,  brain activity and movement.

Today the Dreem Band is the most accurate solution that you can find for the consumer or to measure and analyse sleep. To make that work we started with the laboratory equipment called the PSG, the polysomnograph or the electroencephalograph (EEG) and we made a version that works that works from your bedroom.

We started the company with a scientific discovery. We learned that by triggering audio stimulations to the brain, at very specific moments of brain activity, we were actually able to enhance your quality of deep sleep, which is one of the most critical stages at night for recovery.

The evolution of the Dreem headbandSo the vision that we have with the company is to build the first reference solution to bad sleep, which is noninvasive, efficient, and complete enough to cover all cases of bad sleep.

What inspired the Dreem headband?

JM: What was the original motivation to build a hardware device to address the problem of bad sleep?

HM: When I started the company I understood that sleep was a really widespread problem. You have more than a third of the population not sleeping well. And in front of that, the solutions existing today are not really good or going far enough.

So if you go and talk about your poor sleep to your general practitioner he’s going to say take sleeping pills, which is not good for your health and which is not adapted to most of bad sleep cases.

Then you have sleep doctors and sleep experts. But in the country where we created the company, in France, you have probably 20 or 30 sleep experts, which is not enough for, you know, 10 or 15 million French people suffering from bad sleep.

And finally you go and look online and you find all the sleep technology solutions, and what we found out, is most of the solutions are only doing tracking.

But most of them are not really accurate because if you really want to understand how sleep works, you need to understand how your brain works at night. So we need to have a measurement of your brain activity, heart rate, breathing frequency and movement – movement is not enough.

And so ultimately [these products] are not efficient enough to help you sleep better. And so we started with this idea of proposing deep sleep stimulation to users to enhance the quality of deep sleep and so to optimize the quality of their sleep in a noninvasive way.

We have done a lot in four years. We have developed three iterations of the product. We have 600,000 nights in our database, which is one of the largest EEG repositories in history. We have 25 patents on the whole technology and we have 25 laboratories and hospitals working with us.

And we have a lot of sleep experts working with us so we have identified in the scientific literature what are the interesting concepts and methods that we can implement in our product.

The first pillar of the solution is the Dreem band that you wear at night. So we started with this idea of stimulating the brain with sounds, to enhance deep sleep, but then we added new features to focus on other important moments of your day or your night.

We have developed a range of audio programs to help you fall asleep faster at the beginning of the night. So they are coming from concepts in biofeedback and neuro-feedback. Basically, it’s to help you fall asleep faster and relax before going to bed. So we have the deep stimulation, we have a smart alarm clock at the end of the night, for waking up at the optimal time.

JM: You’ve recently introduced a new set of features that build on the capabilities of the Dreem band that make use of new software applications you’ve developed?

HM:  About a year ago, we understood that what we have is basically a great way to measure your brain activity, the most accurate one.

But then we understood that for specific cases of bad sleep, for example, people suffering from insomnia for five months, a year, 10 years, five years, they are also building some kind of psychological barriers and psychological locks.

And so it appeared to us that one of the biggest topics that we should address as well were the behavioural, and the psychological components of bad sleep.

So that’s why we completely redesigned the mobile app. Now it’s called the Dreem Coach because the vision for the app was really to build a personal sleep companion. Someone that can engage you from the very beginning by understanding what kind of problems do you have, what are the sources of your problems, and then really help you in using these tools.

What is the Dreem Coach?

JM: So who is the Dreem Coach for and what kinds of sleep problems does it address?

HM: We have built the Dreem library of programs because we believe that you have in your life, you will have multiple steps and stages and periods of time where your [sleep] problems will be different.

So it could be because you’re pregnant. It could be because you’re a young parent. It could be because you’re traveling a lot and you’re jet lagged. It could be because you’re working a lot. It could be because you’re a shift worker or it could be that you have developed chronic insomnia.

And so the idea was to build some thematic programs that you could use based on your needs.

So the Dreem techniques really cover 24 hours, so napping, relaxation, you have features to help you fall asleep faster, you have deep sleep stimulation and you have the smart alarm clock, these are the tools we have been working on in the past four years. 

The ultimate power-nap tool?

JM: So how does the napping feature work?

HM: So say, for example, I have only 30 minute for a nap and we’ll wake you up at the optimal time so that you don’t fall into deep sleep and don’t feel tired when you wake up.

JM: So is there some feedback process going on with regards to detecting when you might be entering deep sleep?

HM: Yes we can see very accurately the data, so when you’re about to enter deep sleep, your brain is generating certain brainwaves that we call sleep spindles and K- complexes.

So when we detect that we know that you’re probably going to enter into deep sleep  the headband is able to wake you up at this time, because if you fall into a deep sleep, then you’re going to have sleep inertia for 30 minutes to an hour. And so that nap is not that useful.

Meditation and relaxation

HM: So yeah it’s a pretty good way to optimizing the duration of naps and the product is also proposing some relaxation techniques during the day.

So there are a lot of apps to do meditation or relaxation or breathing exercise during the day. But the [Dreem] product adds a very important layer which is your physiological data because the headband is able to measure in real time, your heart rate, your breathing frequency, and your brain activity.

It can let you know what effect, the session of meditating or breathing exercise had on your physiological data. And it’s very important because if you want to improve and relax better, we need to understand the output on your body.

Cognition

JM: I’ve also seen you have a curious feature that’s based on playing back random words to help users fall asleep?

HM: Yeah so we actually found the idea it from a Canadian sleep researcher.

One of the main things that prevent people from falling asleep is because they have cycles of bad thinking and bad thoughts. And [according to the research] you can easily distract people from these thoughts by playing words. And so we said, ah it’s interesting. 

So, at the beginning you have words which makes sense – you ask the user to picture a scene, like a sun, so you’re just seeing a beach or something like that.

And then when we see that the attention is good and [the user is] falling asleep we start to play some  random words. So when you fall asleep, you have this feeling that you’re already a bit dreamy and you’re thinking about weird stuff and you’re making some weird associations and so we wanted to recreate that by using words.

So this is our feature called Cognition, and we are training a bunch of stuff because I think that you don’t have one solution fits all.

So maybe you are going to fall asleep because you listen to poetry or listen to a podcast. Someone else will fall asleep because he hears random words. Someone else will fall asleep because he’s doing breathing exercises, someone else is going to do meditation, etc etc.

So we are trying to build tools, understand on which user it works, and then try to recommend to the user the tool that they should use.

Dreem and CBT

JM: Can you explain more about the Dreem CBT program?

HM: So the one big program that we have developed now is the Dreem cognitive behavioral therapy program, our CBT program. I don’t know if you’re aware, but at the World Health Organization, the reference treatment for insomnia is CBT. It’s not sleeping pills it’s CBT.

Today’s CBT is usually done by a physical person that you meet once every week for six to eight weeks. And the goal will be to really educate on your sleep, educate on your perceptions around sleep, break some bad habits, and also do some exercises like forced privation where you are advised to go to bed late because if you’re going to bed too early then you’re going to condition your brain to say when I’m in bed I’m, not sleeping.

JM: So this is sleep restriction, you’re talking about?

HM: Yes, which can seem kind of paradoxical, but actually it’s really useful because it’s educates you and the brain – that when you go to your bed you sleep.

And so all these concepts are under the package of CBT. And it can be done with a professional. Also, you have some applications that do it in a digital way like Sleepio for example.

Dreem vs other digital CBT solutions

JM: So how does Dreem’s CBT implementation differ from Sleepio and other digital CBT programs?

HM: So first of all I want to mention that Sleepio is a great company and they have been building a great product and they have been really good at executing on the strategy and stuff like that.

The results on Sleepio are really good. Like, you can reduce your sleep onset latency, by 50 percent. You can reduce night awakenings by 50%. But this is true only on the 40 or 50 percent of users that did the program. And so it means that you have 50 or 60 percent of other people that are not going to complete the whole program.

And so we launched the Dreem CBT program six months ago and what we have seen is we have a much higher retention rate. In our case, as it’s associated with the Dreem headband, people really trust us and are much more engaged, for now we have 99.0 percent of all users that started our CBT program have ended [it].

And so the reason behind it is that Sleepio, is not really individualized, it is not measuring any input from your physiological data.

So having the Dreem band makes people trust what we do, because we say [for example] ‘your problem is you’re going to bed at eight, but you’re sleeping at 11. Actually you have a pretty good amount of sleep but your sleep efficiency is really poor.’  So by showing the data, showing the results, it makes it much more engaging because people trust us.

JM: So essentially by providing accurate physiological data from the Dreem band, your users are able to get instant feedback on their CBT progress, and are hence more likely to stick with it the program until completion?

HM: So this is one thing and the second thing is in CBT we have also some exercises. We are going to teach you about relaxing at night, rituals you can do, habits that you can do, and the headband can directly help you so you’re not alone.

If we say just breath in breath out, do that exercise, it could help you at night and when you go in your bed and you’re just thinking about all these bad ideas, like I won’t be able to sleep, having the voice from Dreem, helping you, guiding you and then seeing the results in the morning is really powerful.

Evolving from a hardware-only company

JM: So it seems that there’s been a little pivot away from the original concept, as a lot of the focus was originally on the hardware, but the company seems to have evolved into more of a platform now?

HM: Yeah, definitely. I think it’s a very, very good question. So we didn’t pivot, but we built more accurately the product vision.

So we knew from day one and a lot of people were telling us, if you’re not sleeping well, you’re not going to sleep with a headband on your head, but our vision at this time was if you want to build an efficient sleep solution, you need a solution that will be personalized and individualized.

And the only way of understanding that is by measuring your brain activity. So it was one of the core ideas at the beginning. And so we developed the Dreem band.

And now we see that it’s especially useful for CBT, for stimulation, for everything else, but if you have someone that has had  insomnia for 10, 15 years, just doing stimulation is not going to solve the problem.

So what else can we do? And so we started to build this kind of tool and then by, by building the tools, we said we need to help you use the tool, so let’s do the coach.

And so yeah, definitely I think the hardware will be always be enabling everything. It’s really like the basis of our pyramid of features. It’s enabling everything. But definitely what we’re offering here, it’s a kind of service. And also I think the business model should evolve.

We can’t cut the cost of the product because the product is expensive to make because it’s using state of the art technologies. But we can invite new new business models and new ways of using the product that’s more aligned with everyone’s needs.

The ‘bad sleep map’ – solutions for every sleep problem

HM: So you can have just someone interested about his sleep, just wants to try and understand his sleep and just by knowing the information he will sleep better.

Or you have someone who has tough, insomnia, needs real support and a real program for eight, 10 weeks. Or you can have someone that has no sleep problem but they have other pathologies that are impacting the sleep quality, maybe this person has sleep apnea and she doesn’t know. And so maybe you can let her know.

So what we did is, we have 600,000 nights in our database, which is one of the largest EEG repository in history. And so we really worked on a bad sleep map.

So now we believe that we can help 85 percent of bad sleep. Some cases like narcolepsy will require some kind of chemical treatment which is specific to the disease, but for the rest we believe we will be able to solve everything.

That’s where we made the vision of the product evolve and we want to be a real sleep reference solution that anyone around the world complaining about fatigue, tiredness and sleep can use the product, understand the problem, and then add the right solution in the portfolio or the platform of solutions.

Digital health and beyond

JM: It’s clear there must be alot of other options for Dreem, other than selling directly to the consumer market. How does Dreem fit into the wider world of digital health, or as a B2B product?

HM: So for me, the best strategies for the business model of the company is the best strategy from a product and user perspective.

A lot of people always ask me, are you a medical company or your consumer company? I say, I don’t care. What I care about is, if you’re someone who is not sleeping, can you find a solution by using the product?

So then you have the business model, right? Because a €500 euros is an expensive product. So we can believe that maybe by meeting some kind of FDA approval or CE mark in Europe, [users] can potentially get reimbursement from insurance, etc.

I think this is long and I think a lot of companies are doing that because consumer is hard. But I believe that there is a consumer market and people are ready to pay for their sleep, but again, they need find value in what they pay.

And so again, for someone sleeping, you know, someone has insomnia, they shouldn’t pay the same price. So the answer, about that is yes, we are looking at the FDA looking at CE marking, but we need to have a true, added benefit for the user.

It needs to fit with the company strategy. But right now I believe that by first focusing on making the business model evolve, we can still fix a lot of problems.

Summary
It’s clear that Dreem is only at the beginning of a long journey to create what they hope will become the world’s first ‘reference solution for sleep’.

But right now the company seems to have a lot of the pieces in place to move forward with their vision; a large team, the hardware, the software, a big dataset, scientific advisors, and of course financial backing to facilitate its goals.

There are some drawbacks however. At €500 the current Dreem headband is out of reach for the vast majority of consumers. Plus, there’s the wider issue that not everyone will be willing to strap on a wearable every night to go to sleep.

But arguably what differentiates Dreem from the rest of the sleep technology crowd is a panoramic strategy to become to tackle sleep problems across the board.

This they hope will cater not only to the burgeoning sleep wellness market, but also to future opportunities in sleep medicine and digital health.

Whatever the future holds,  it will be exciting to see what new developments Dreem has in store for 2019 and beyond.

This interview was first published at our sister site SleepGadgets.io