Unicorn Haircuts: Magical Mane Makeovers

The Rise of Tech-Enabled Barbershops

The idea of digitally transforming a traditional service like a haircut might have seemed unlikely in 2020. However, 2021 reveals a surprising trend: technology-driven barbershops are now a significant business opportunity, estimated at a valuation approaching a billion dollars.

Squire's Growth Trajectory

Squire operates as a back-end management solution designed for independent barbershops. Initial coverage of the startup occurred during the early stages of the COVID-19 pandemic. Remarkably, the company secured substantial funding just prior to widespread closures impacting its core customer base.

Subsequently, Squire adapted its strategy, becoming a crucial partner for barbershops seeking to implement contactless payments, online appointment scheduling, and enhanced customer experiences tailored to a digitally native clientele.

Valuation Tripling

This week, Squire experienced a tripling of its valuation following a funding round led by Tiger Global. The company’s current worth is $750 million, a significant increase from the $75 million valuation recorded during our initial coverage.

Expansion Plans and Strategic Partnerships

According to co-founder Dave Salvant, who established the company alongside Songe LaRon in 2016, Squire is now positioned to broaden its offerings within the barbershop sector. This expansion will be pursued through both strategic acquisitions and collaborative partnerships.

Recently, Squire announced the launch of a payment processing service in collaboration with Bond, a fintech infrastructure company backed by venture capital. Furthermore, a partnership with Gusto will provide HR services to its client base.

Salvant highlighted that advancements in technology, particularly within financial services, enable Squire to deliver a robust product suite without the need for extensive in-house development.

Potential for Acquisitions

While current initiatives involve partnerships, it wouldn’t be unexpected to see Squire acquire companies capable of leveraging the valuable data it possesses regarding barbershop operations and financial flows.

Key Insights

Growth alone isn't sufficient for sustained success.
Squire successfully navigated the challenges presented by the coronavirus pandemic.
The increasing trend of fintech startups providing loans to small businesses is noteworthy.

Squire represents a compelling case study of a startup that faced adversity during the pandemic and subsequently thrived with new investment. It is also noteworthy as a company on track to become a historically significant and, unfortunately, still uncommon Black-led unicorn.

Further data and analysis will continue to provide valuable insights into this evolving landscape.

Additional discussion in this newsletter will cover Robinhood’s public debut and a CEO’s perspective on the importance of empathy. You can connect with me on Twitter @nmasc_.

Robinhood's Initial Public Offering and Subsequent Stock Performance

The anticipated initial public offering (IPO) of Robinhood has finally occurred, but not without immediate market reaction. Following its pricing at the lower end of the projected range, the stock of the popular investing application experienced a significant decline, fluctuating between 8% and 10%.

Reasons for the Initial Stock Dip

Robinhood’s stock performance deviates from typical trends observed with consumer-facing technology companies during their IPOs. Equity co-host Alex Wilhelm, an IPO specialist, identified two key factors contributing to this downward movement.

One potential cause for concern may be the company’s own forecasts. Robinhood cautioned that trading volumes could decrease during the second quarter of 2021, potentially discouraging investors.

This warning regarding potential volume reduction appears to have influenced investor sentiment. Some market participants, often referred to as "bulls," may have reacted negatively to this projection.

The initial stock decline represents a notable event in the context of recent IPOs. It highlights the complexities and uncertainties inherent in the public markets, even for highly anticipated companies like Robinhood.

Understanding the factors driving this performance is crucial for investors and observers alike. The interplay between market expectations, company forecasts, and overall economic conditions will continue to shape Robinhood’s trajectory.

The Rise of "CEO for a Day" Programs

With traditional employee benefits like complimentary beer becoming less common, a novel approach to boosting morale and engagement is gaining traction: allowing any employee to assume the role of Chief Executive Officer for a day.

This initiative was first popularized by Ville Houttu, the CEO of Vincit, who introduced the program in 2018.

Houttu reports that the benefits derived from this practice have been substantial, yielding returns “tenfold.”

How the Program Functions

The mechanics of this unique program are straightforward, as detailed by the company itself.

The resulting company policies, as observed in related coverage, are demonstrably more effective than simply offering free beverages.

Key benefits include:

Enhanced employee engagement.
Increased understanding of company operations.
A boost in overall morale.

Ultimately, the "CEO for a Day" concept presents a compelling alternative to conventional perks.

TechCrunch Disrupt: Key Highlights

The full agenda for TechCrunch Disrupt has been released. It presents a compelling program and is considered a crucial event for industry professionals.

Several sessions are particularly noteworthy, offering unique insights from prominent figures.

Featured Sessions

Pot, Pottery and Beyond will feature Seth Rogen (Houseplant), Haneen Davies (Houseplant), and Michael Mohr (Houseplant).
Breaking the Bank will host Brian Armstrong, the CEO of Coinbase.
A discussion on Speaking SPAC will include Chamath Palihapitiya from Social Capital.
Dogmatic Design will showcase Melanie Perkins, the founder of Canva.

These sessions promise to deliver valuable perspectives on a range of current topics within the tech landscape.

Team Update

Recognition is given to Amanda Silberling, a new member of the TechCrunch team. She is quickly establishing herself as a leading voice in consumer technology reporting.

Those interested in her work are encouraged to follow her on Twitter for regular updates and analysis.

Silberling’s contributions are already proving to be a significant asset to TechCrunch’s coverage.

Weekly Highlights

Featured in TechCrunch

Tesla achieved a quarterly profit exceeding $1 billion.
Microsoft’s earnings surpassed expectations, driven by 51% growth in Azure; however, shares experienced a decline.
Robinhood’s stock value decreased by 8% during its initial day of trading.
Prominent business leaders have established an $85 million fund dedicated to supporting Indian SaaS startups.
The strategy of mmhmm and its plans for utilizing $100 million in funding were detailed.

To stay informed about public market developments, consider subscribing to The Exchange, presented by Alex Wilhelm and Anna Heim.

Insights from Extra Crunch

The expansion of venture-backed edtech into China is currently experiencing a slowdown.
Waseem Daher, CEO of Pilot, provided a detailed analysis of the company’s $60 million Series C pitch deck.
Machine learning offers financial institutions a valuable tool for streamlining and improving anomaly detection processes.
Insights were shared regarding the experiences gained from five years of investing in common stock within the startup ecosystem.
Venture capital activity in Latin America is currently at an unprecedented level.

Further updates will follow shortly.