GlossGenius Raises $16.4M to Empower Beauty & Wellness Businesses

GlossGenius Secures $16.4 Million in Series A Funding

GlossGenius, a technology company serving the spa, studio, and salon sectors, has announced the completion of a $16.4 million Series A funding round. This financing was spearheaded by Bessemer Venture Partners.

Angel Investor Participation

The funding round attracted significant participation from a prominent group of angel investors. These include Tobias Lütke, co-founder and CEO of Shopify, Chris Comparato, CEO of Toast, Aman Narang, Toast co-founder, Robert Murphy, co-founder of Mindbody, and executives from Yelp and Venmo.

Growth and Expansion

GlossGenius currently supports “tens of thousands” of businesses, with two-thirds being owned by women or individuals from underrepresented groups. The company has recently exceeded $1 billion in gross merchandise volume (GMV).

The B2B software startup has expanded into financial technology, developing a card reader that seamlessly integrates with its existing application.

A Comprehensive Business Solution

GlossGenius positions itself as a complete “Business in a box” solution for owners of salons, spas, and studios. The primary objective is to alleviate administrative tasks, allowing business owners to concentrate on growth initiatives.

Founder and CEO Danielle Cohen-Shohet explained that GlossGenius connects all aspects of a business’s back-office operations within its platform. This ensures all necessary tools and information are readily available.

Company History and Bootstrapping

Cohen-Shohet, a former analyst at Goldman Sachs, established the New York-based startup in 2016. Prior to this funding round, GlossGenius raised $2.8 million in pre-seed and seed funding.

Notably, the company then operated for five years through bootstrapping before seeking additional external investment.

Focus on Product-Market Fit

“Early on, prioritizing bootstrapping allowed us to maintain a strong focus on achieving product-market fit and generating revenue,” Cohen-Shohet stated in an interview with TechCrunch. “For a considerable period, the business was primarily financed through its own revenue.”

Card Reader Success

The newly released card readers experienced a rapid sell-out within 24 hours and have gained considerable traction on social media within the salon community, according to Cohen-Shohet.

These readers integrate directly with the GlossGenius ecosystem, enabling businesses to track transactions, analyze data, and categorize expenses efficiently. They also facilitate the tracking of client visits, history, and revenue in a unified manner.

Vertical SaaS Strategy

While some companies pursue a broad, horizontal approach, GlossGenius emphasizes the importance of its vertical SaaS strategy. Cohen-Shohet draws a parallel to the success of Toast.

“The recent IPO of Toast underscores the enduring value of vertical software. Small businesses have unique requirements and benefit from technology specifically designed for their needs,” she noted. “A one-size-fits-all approach is insufficient. We are witnessing a resurgence in technology tailored for SMBs.”

Prioritizing Growth and Innovation

Currently, GlossGenius is prioritizing growth over immediate profitability. The newly acquired capital will be primarily allocated to expansion and the development of innovative product features designed to simplify business operations.

The startup also intends to expand its team, which currently comprises 100 individuals.

Organic Growth and Marketing

Remarkably, GlossGenius has surpassed $1 billion in GMV without employing a dedicated sales team. Its growth has been largely driven by word-of-mouth referrals, according to Cohen-Shohet. A portion of the new funding will be used to establish a marketing team.

Bessemer Venture Partners’ Perspective

Kent Bennett, a partner at Bessemer Venture Partners, expressed his firm’s admiration for the strong customer loyalty demonstrated towards the GlossGenius product.

He described the startup as “one of the few efficient, rapidly growing companies achieving success through organic adoption among small businesses.”

“GlossGenius distinguishes itself by prioritizing the needs of service professionals who operate their businesses, rather than focusing on business managers with a top-down approach,” Bennett explained via email. “This focus on superior functionality leads to organic growth for businesses of all sizes within the beauty and wellness industry.”