More than 200,000 people own a Loftie Clock. It’s been Wirecutter’s top alarm clock pick for six years running. By most measures, Loftie is a hit. But founder Matthew Hassett will tell you the hardest part of building a hardware company isn’t designing the product—it’s financing enough inventory to meet demand. Venture capitalists don’t want to touch hardware. Inventory costs money months before it generates revenue. And if you price your product wrong, you can drain yourself trying to keep production going even while demand climbs. Matthew bootstrapped Loftie from a screen-time app into a seven-person wellness brand that just shifted its entire business strategy around one metric: contribution margin. Here’s what he’s learned about the unglamorous financial reality of selling physical products.
On starting with an app and ending up with an alarm clock:
I was an entrepreneur in residence at IDEO, the legendary design firm, and I noticed people around me doing things like getting off Facebook entirely or deleting Instagram for the weekend and putting it back on Monday. I knew there was something there. So I started this app called Deliberate that was all about being deliberate with your screen time—taken from Thoreau’s idea of living deliberately. You set a screen time budget, and if you stuck to it, you got points to redeem for prizes like a smoothie or a SoulCycle class.
We got pretty far down the road. We did a prototype at IDEO. There were power users redeeming all kinds of rewards. But two things killed it: Apple made it hard for one app to know what the other apps were doing—there was no screen time software development kit (SDK). And I could see us going down the Gilt or Groupon path of just having to source more and more rewards.
So I pivoted and decided to make a physical product. After thinking a long time about what would help with a digital detox, one of the things that would definitely be in that box was an alarm clock. It’s this obvious thing we’ve mostly all chosen to bundle into our phones since 2007. But some things really deserve to be unbundled, because bringing your phone into the bedroom comes with all these side effects. The alarm clock needed a reinvention.
On going into strangers’ bedrooms to design the product:
Our industrial designer followed a typical IDEO research process, and we met our customers where the problem was actually happening—in their bedrooms. We posted Facebook ads saying we wanted to learn more about sleep and screen time, and then we picked people who might have outsized, interesting cases. One person had never bought a phone—she used subway maps. Another was a trainer who slept three or four hours a day driving in from upstate New York.
Going into people’s homes and really seeing what they’re experiencing is invaluable. Our blackout mode feature, where you can black out the entire clock face, came directly from that research. A lot of people had, like, a t-shirt draped over their cable box because of a bright LED. So we made little stickers called Dark Dots—thick vinyl you stick over any light—and we built the blackout feature into the clock itself. You hold down the snooze button and everything turns off.
On the Wirecutter effect and why he’s never paid for media:
So many people Google “best alarm clock” and the first hit is the Wirecutter story we’ve been in for six years. We’ve never paid for any media. These are all organic articles. Writers like to write about sleep—it’s a perennial topic. Daylight Saving Time drives the second biggest peak of searches for alarm clocks right behind the holiday season.
It’s often affiliate, so if it’s a product recommendation article, the writers can earn an affiliate commission. There’s a symbiotic world there. But the actual choosing of products is organic. Big outlets like The Wall Street Journal and the Financial Times, they don’t do pay-for-play. You have to have a great product. Wirecutter is incredibly strict. They don’t keep the products they test. They send them back when they’re done. The writer has changed over the years for both the clock and the lamp, and we’ve been lucky to stay a favorite.
I’d be lying if I said I had to pitch it. They’re product people—they reach out, they email and say, “I’d like to try the Loftie Clock.”
On why VCs hate hardware—and how that’s actually a moat:
I’ve pitched so many VCs and they all said no. They still say no. I think if I had done certain things that wouldn’t have been good for our customers, they would have probably said yes—like if I’d pursued the Ring model with a low price point and a big subscription you had to buy. That would be very appealing to a VC. But customers are outraged by that approach. I’ve never wanted to do it. And it’s against the ethos of our industrial designer, who is a real purist and believes a product should last for a lifetime.
So it’s a tough balance to sell great products and court VCs. I’ve gone without VC money other than a small investment from Supermoon. VCs really hate hardware products. It’s very scary to them. But it’s nicely a moat for us—they’re not giving anyone else money either.
On the brutal reality of financing inventory:
It’s very expensive to make high-quality hardware. Our lamp has 120 lights inside, a computer chip so we can update it with an app—there’s a lot of tech. Someone has to finance all of that. We have to take on debt to pay for it five months before it can even be sold. Not before it sells, but before it could be sold—like when it finally hits our warehouse.
I was reading a book about Apple in China recently and found a Tim Cook quote I’ve been repeating a lot: “Inventory is fundamentally evil.” That’s definitely true for consumer products. Even at Apple’s scale, they try not to hold inventory. There’s never enough financing if you’re growing, and we’re always growing. You’re always breaking at the barrier of having enough inventory.
On contribution margin as the metric that changed everything:
We went through many paid agencies. We’re now with one that’s been transformative, Common Thread Collective. They’re very different in that they’re more of a CFO-style marketing agency. It’s all about planning ruthlessly around contribution margin. They have their own ad attribution platform called Statlas, and right at the top is contribution margin.
That is the key business metric. If you think it’s about revenue, you can quickly drive your company into the ground. Contribution margin is how much you have left over after you’ve gotten the product to your customer and paid Meta. That’s what you use to pay your employees, pay the rent, pay everything else.
Being focused on contribution margin changed how we operate. Getting to a stable customer acquisition cost has been the most important part of having a sustainable business—one where I don’t have to check Shopify every day and don’t have to be anxious about whether we can pay our bills.
On the full-circle pivot back to digital:
Because it’s become so difficult to predict what it’s like to make and sell physical products in the United States, we’ve focused increasingly on selling physical products outside the US and digital products inside the US. In 2025, Europe became our biggest market. It went from 2% of our sales outside the US to the vast majority of our physical product sales on Shopify being outside the US.
And then for digital, we’re building out our app. It started as just a way to set an alarm or change your brightness. But we’ve now added an app blocker—getting back to that original Deliberate mission. You can schedule when you don’t want to be on your phone. There’s a Relax phase, a Sleep phase, and a Wake Up phase. It really comes back to the classic behavioral economics example of Odysseus tying himself to the mast to avoid the sirens. The modern version is trying to avoid opening Instagram.
What’s funny is my team recently pitched me on this new version of the app, and it’s pretty much what I started with Deliberate. I brought up the old site and they were like, “Oh yeah, this is exactly what we were thinking”—only seven years later.
Catch Matt’s full conversation on Shopify Masters to hear how he’s using Claude for inventory forecasting, why he’d never do another crowdfunding campaign, and the IDEO design philosophy that taught him to study squirrels before solving business problems.
