Announced Wednesday, Heyday has raised $12 million in additional investment from existing investor Level 5 Capital Partners.
Founded in 2015, facial service provider Heyday has now raised $40 million in outside capital. In 2021, the company announced it would add hundreds of physical stores over the next five years through franchises in states like Virginia, Texas and Michigan. He now has 13 locations across the United States. It also raised an additional $20 million in Series B funding in 2021. It was also led by Level 5 Capital Partners.
Like many other businesses, Heyday stores experienced a series of temporary closures in 2020 due to Covid-10. Heyday stores have closed for seven to 16 months in 2020 in cities such as New York, Los Angeles and Philadelphia. Heyday was unable to operate a physical service, so the team decided to spend time improving some of his backend technologies, such as the company’s online booking platform. We also added new brands to our merchandising.
Heyday co-founder and CEO Adam Ross said: “[We’re positioned] Hold your flag firmly on the ground and say, “Hey, we’re the market leader, we’re a national brand.”
Roth said the justification for this expectation is the overhead that smaller boutiques and individual spa locations have to incur. Secondly, these places have to charge higher costs, but Heyday’s suggestions have always been in the more affordable range. Her 50-minute facials on Heyday start at $140 and offer monthly memberships for $109 a month. Members are entitled to discounts on additional facials, additional services, and products on top of her one facial per month.
Heyday’s current revenues are in line with pre-Covid levels by store, Ross said, but treatment appointments are “a bit below” in 2019.
Heyday is on track to reach $100 million in total revenue by the end of 2023, according to Chris Kenny, managing partner at L5 Capital. A $50,000 franchise fee and a $500 security deposit. A place’s first-year average revenue is his $1.6 million and EBITDA is his $80,360.
“We see consumers talking pretty loud,” says Kenny. “1 [of the reasons] unlocks accessible facials and is more widely available on street corners across the country. [Reason] Second is the acceleration of some macro trends due to the pandemic. Wanting an accessible, high-value facial isn’t New York or Los Angeles. ”
Additional funds will go towards franchise operations, including marketing investments and back-end processes. Heyday is also investing in its first private label product to be used exclusively within his Heyday service by the second quarter of 2023. These products are for service use only and not for home use. Ross explained that Heyday uses his 10 locations owned by Innovation as his lab to develop more personalized products for different skin types. Since the launch of his Heyday in 2015, Ross says about 650,000 facials his treatments have given him a deep insight into different skin needs and types. Additionally, 25-30% of Heyday’s new customers have never had a facial before, indicating potential for growth in the industry.
L5 is also committed to developing and owning 60 Heyday franchises over the next five years. Ross said it would be attractive to have investors “who are familiar with both sides of the game” when it comes to franchising L5.
“We were looking for a thoughtful investment partner who could help us refine [our approach] And hold us accountable for making sure we do things the right way,” Ross said.