When the AI startup Factory had just 30 employees, chief executive Matan Grinberg made an unusual investment in his workforce. Instead of spending on flashy office perks, he bought a $3,000 Eight Sleep mattress cover for every employee.

"I want to make sure everyone is squeezing out every ounce of brain power they have," Factory's CEO said. "To do that, you need to get good sleep."

An AI startup CEO is prioritizing employee well-being over traditional perks, gifting each worker a $3,000 sleep-enhancing mattress cover. He believes superior rest sharpens…