Stella Sleep Develops The Future Bedtime Routine For Kids

The war pretty much destroyed everything for Saga Sleep and the Swedish-Ukrainian founding couple. Their first priority was to put the family to safety, and then the company had to be saved. Now the tech company – which wants to help tired parents of young children at night – has braced itself and re-charged. To help them, they have John Cleese and new heavy investors.

Parents around the world can unite in the challenges of toddler and smaller kids’ bedtime. It can be equal parts a cozy winding down, as a desperate struggle for hollow-eyed moms and dads. The company Saga had a solution to the problem. They built a sleep app for children with a library loaded with bedtime kid sleep stories, constructed with the help of Swedish sleep psychologists, that would act as complement to the everyday routines.

The service was launched in Russia in 2020, where the founding couple Svetlana and Erik Björkman, with a background in the beauty brand Oriflame, had business experience. When the war started, everything changed. Svetlana Björkman comes from Ukraine and her first priority was to make sure the family was safe. At the same time, revenues plummeted for the company Saga Sleep, which had 80 percent of the turnover in the now hard sanctioned Russia.

“My wife and partner is from Ukraine so we were very affected by the war. It was hard to focus. In addition, our technical director is a Russian who has now moved to Thailand with his family.”

Erik Björkman, CEO of Saga, says that the couple faced a tough trade-off.

“We had to make a decision: Should we just shut everything down?”

The decision was to continue.

“There was no doubt in the end. After all, we both live off Saga, and we had seen there was a clear demand for this product, so we steeled ourselves. But it is clear that we have pulled each other through this, it has not been hunky dory.”

The company had completed a financing round in November 2021, and now asked their investors if they should close down the whole operation, and send the remaining money back – or invest in a new market?

It became a new market and a new product. In July, the new app Stella Sleep was launched to the English-speaking market. The app has now been downloaded 20,000 times times (which compares to almost half a million downloads for Saga Sleep). Most of the investors stayed, says Erik Björkman. And the company, who pretty much had to roll up their sleeves and start over, now gives announcement of strength in the form of a new financing round in October 2022. Saga added 3 million SEK, with a total raise of 13 MSEK to date, and added new investors to the cap table.

“It is a good proof of confidence that we could raise another round now, and that we have attracted five new investors, which together with 15 existing angel investors have provided more capital,” comments the CEO.

The owner list includes Viva Wine co-owner John Wistedt and Alireza Etemad who is a partner at IK partners. Among the new investors in the latest round are notable Swedish business profile Maria Rankka, Silver Life CEO Carl-Johan Westring and Henrik Wrangel, with background at Kry.

The company has also received help from the legendary Monty Python member John Cleese and his 5.6 million followers on Twitter. The founders got in touch with the comedy legend through common acquaintances. Now the Briton has read fairy tales to lull toddlers to sleep and act as a narrator in the app.

The future of bedtime stories

The company is investing heavily in synthesized voices being the future for bedtime storytelling. By creating a believable speech synthesis of a father’s or grandmother’s voice, a parent can read any fairy tale remotely when the child sleeps over with someone else or an older relative remains as narrator after his demise.

“It exists, but it still sounds robotic when you apply this tech, and you can only make it sound nice if you apply a lengthy manual process in a studio really. But give it 12-24 months, and the tech will be good enough so make it sound 100% natural and be commercially scalable. It makes me think of the imperfect speed when Spotify developed the best streaming music player in the beginning, as we can become the first in the market to provide this service,” says Erik Björkman.

“In five years, we hope that you will have 50,000 synthesized voices and have become a trusted channel for basically saving audio memories for future generations,” says Erik.

In terms of turnover, Saga has actually increased from last year. The company who was born during covid more than doubled its revenues in 2022, despite the war. In 2023, it aims to grow revenues 3x the 2022 number.

Try the app today.