Nugget, a tiny furniture company that set up its offices and manufacturing at Bellevue Mill on Nash Street in 2018, has officially gotten too big and moved its headquarters and operations to Butner. Hillsborough will be able to say, “We knew you when…”
The company makes the “Nugget,” a sort of Swiss Army Knife of kids furniture that has grown unbelievably popular among young parents seeking ways to keep their kids’ imaginations unbound by the limits of a pandemic. The Nugget is a small, soft — yet firm — piece of floor seating that can be reconfigured into a number of different shapes. It has four pieces: a thick base, a thin cushion and two triangular pillows. It sells for $229 for most models ($249 for options with certain fabrics).
But finding one to purchase is the real challenge. The company has grown 13,000 percent since 2017. The Nugget is, right now, the fastest-selling furniture in the U.S. “Drop sales” of the Nugget — in which up to 10,000 Nuggets made available for purchase — were selling out in seconds. The company had no choice but to leave its 12,000-square-foot space in Hillsborough for its new 120,000-square-foot facility in Butner.
“We figured we would need a bigger space in mid-2019, though we didn’t know where,” said Hannah Fussell, co-founder and chief product officer. “It was really hard to find space. We were looking more in Durham. We couldn’t find space in Hillsborough. We had been looking for a space that was bigger than what we had in Hillsborough, but not this big. But then we had this insane holiday season and we were, like, ‘we’re going to need a bigger boat’. We went a lot bigger and found this space and it ended up being perfect.”
The first concept for Nugget was in 2012 and was the work of friends and UNC students David Baron and Ryan Cocca. Originally, the Nugget was planned as a replacement for the college futon, the stereotypical and bulky furniture of choice for students that was often left for trash at the end of each school year.
Nugget became an LLC in 2014. Baron and Cocca sent an early version of the Nugget to Fussell, who was a friend from UNC and was teaching at a school in Miami, to use in her 4th-grade classroom. Her students’ response to the versatile furnishing was a game-changer.
“They were totally obsessed with it,” Fussell said. “I had students with sensory processing disorder, autism, oppositional defiance disorder. I had a beautiful array of students, and those kids really took to the Nugget as a comfy, safe space. They could flip it, play with it. If it’s raining out, indoor recess, everyone who turned in their homework gets to play on the Nugget. If you were really good and quiet during that reading session, you get to watch a movie on the Nugget. It became an incentive. It was very core to my classroom culture. It was fun.”
That experience led Fussell to return to North Carolina to help Baron and Cocca refine its marketability and its audience. The company launched a Kickstarter fundraising campaign and blew away its goal. Things really picked up in 2017, and the company moved into Hillsborough in 2018.
“Those early years, our biggest kind of sales periods were back-to-school and holidays. We always do a lot of sales at holidays. These were parents buying them for the homework area, and it was also teachers buying them. Some of our first big marketing campaigns were teacher influencers,” she said.
The big purchasers of the Nugget now are millennial parents, particularly millennial moms. The company’s Instagram analytics are almost 98 percent women purchasing them for their children. The age of children being bought for has dropped from 6 to 10-years-old, to being given as gifts for baby showers.
“It’s funny, people will post pictures of their Nugget being delivered, and it’s become kind of a secret society with our customers because they know if they share about it, then that’s more people that will want it and that lowers their chances at being able to get a second or a third Nugget. A lot of times the caption for our customers will say, ‘If you know, you know,’” Fussell said.
What is it about the Nugget that has created such a rampant and devoted following? “It’s an open-ended toy. Children have embraced it with their brilliant imaginations and their brilliant selves. No instructions required. Children take to it and they know what to do. They build forts, clubhouses, spaceships, racecars. They can build anything they want, so they’re loving that. Parents love that because their kids are engaging in something that’s developmentally appropriate. The kids are not on screens. Kids can get their “wiggles” out on it. Kids are jumping off it. It’s really become this exercise activity for lot of these kids. That’s also been a huge part with everybody being more in the home,” she said.
If demand for the Nugget was already like a kid on a sugar high, the pandemic has added pancake syrup. The company was already facing big demand from the holidays in 2019. It had to put a back-order into place because it had a limited supply.
“We care a lot about our team here, and making sure that it’s safe, making sure we’re not stressing anybody to make the Nugget,” Fussell said. “That was really important to us to not rush into making tons and tons and tons of the Nugget. We wanted to continue making them at a safe, high-quality pace. When the pandemic hit, I think people realized they were going to be home with their toddlers, and needed to make sure they had what their kids needed to developmentally play safely. So, we saw a massive increase in demand. Not necessarily sales because we were sold out and shut down. But demand was really big.”
It’s a business philosophy and situation that has come with issues, such as complaints over lack of availability, copycats and knock-offs being produced. Nugget was dealing with a cycle where its inventory would sellout almost immediately after it was made available.
“The second we would drop it would sell out,” Fussell said. “Thousands and thousands of units. That’s really stressful for everybody. It was stressful for the customers because they were not able to secure their product, they’re fighting with people. They were having to drop everything at noon to get on the computer, get their credit card ready. Get their fast fingers, you know. They were very frustrated. Our customer team would get inundated with frustrated customers. Even though that was the most fair way to do it we could think of at that time, it just wasn’t sustainable. We were also dealing with the “hypebeast Supreme subculture.”
This phenomenon is when there is a limited edition product — such as certain colors — that there is massive demand for is made available, and people go in and quickly purchase the items. Some will even used robots to try to sneak onto a company’s website and buy out the product before anyone else can. Then the item is resold on eBay for often 10 times the price.
“Reseller culture also became really big this year,” Fussell said. “People are reselling our product for $1,000. That was our big problem.”
The company’s solution to this problem was to employ a lottery system. Each Wednesday, for a limited time of the day, a person can register on the Nugget website. Once registered, you’re entered into that week’s Friday drawing. If your name is chosen, you will receive an email from the company and be given the opportunity to purchase one of the Nuggets. Between 5,000 and 10,000 Nuggets are offered each week.
If you’re not chosen, your name is automatically rolled over into the next week’s lottery. “That’s our means of making sure we’re getting the Nugget to as many real people, real families that want it as possible, while also making sure we’re doing something responsible on the production floor,” Fussell said. “People sometimes ask why not go back to drop culture and take in 60,000 orders? With Covid and not knowing what the winter and fall situation will be, having that many orders to fill would be stressful. If we had to shut down again, that would be so many people waiting on orders from us. And we wouldn’t know how long we would be shut down.”
The lottery method ensures delivery of the Nugget for Christmas. Customers who are less concerned with the holidays can still order the Nugget on a backorder system.
We’re taking in 5,000 to 10,000 every week that we know we can make out of here and shipping those out and then moving on to the next batch. It’s the most fair thing, and it’s also the least stressful thing on our production team.
“If you just want your red Nugget, or you just want your blue Nugget, cool. Wait for backorders to come out, put your order in and we’ll ship it to you in the first half of 2021.”
Fussell said the new headquarters has allowed the company to bring its staff up to 80 employees, and plans to continue hiring as Covid guidelines allow. Nugget has leased two-thirds of the building it is in, but has a first right of refusal for the other third of space. The company is working on other products that will compliment the Nugget, but declined to offer any details on what that might be, or when that might happen.
The company does zero paid advertising, allocating nearly all of its marketing on social media. “It’s all word of mouth. Instagram, Facebook groups. Mom groups are pretty big for sharing,” she said.
Fussell said she doesn’t see demand for the Nugget slowing down any time soon. “We just had an interview last night with the L.A. Times, and we did BuzzFeed News earlier this week.
“This has been the most exciting for us. For so long it was just the three of us. We’re so excited to be able to bring in really cool and talented people to help. People are really digging the vision,” she said.