By Warby Parker stands out among start-ups that challenge the status quo by subverting it with their model, which proved revolutionary and led to copycat companies like Glossier and Harry’s Shave Club being inspired to follow in its footsteps – with Madison Reed serving as Warby Parker of hair color!
Madison Reed Scores New Funding
Madison Reed has had an exciting and fulfilling year. Their mission of revolutionizing at-home hair color with products free from ammonia and other harsh chemicals led to them receiving investment from one of Silicon Valley’s premier venture capital firms, First Round Capital in December – becoming one of the best-funded startups.
Now, with its fresh injection of cash, the startup is expanding its presence to salons nationwide and unveiling cutting-edge video chat technology that lets consumers interact directly with expert colorists via video chatting. Furthermore, they’ve expanded their subscription business, enabling consumers to order hair color kits regularly delivered straight to their homes.
Madison Reed has seen success from their omnichannel approach to commerce during this pandemic, with revenue increasing seven-fold and their hair color bar presence expanding by 16 locations to 60 by 2021. E-commerce sales increased as well; now boasting annual revenues exceeding $250 Million!
Although most Madison Reed sales are direct-to-consumer, Errett states the company remains committed to offering an exceptional customer experience. Therefore, the company provides 1:1 video color consultations as well as Zoom hosted “Hair Color House Parties,” where customers can learn how to use Madison Reed products from a licensed hair colorist in real-time virtual setting.
The increased funding has also allowed the company to invest in growth and hire key personnel. Early this year, Angela Jaskolski joined as chief revenue officer to assist in their expansion into retailers like Ulta and Target as well as their wholesale business. They also hired Jose Zuniga from Dollar Shave Club as chief financial officer to oversee both e-commerce and retail operations for them.
Sandbridge’s $33 million investment brings Madison Reed’s total financing to nearly $220 million according to Crunchbase, joining investments by True Ventures during its Series F stage and Marcy Ventures which led the recent Series G round. Both firms will hold board observer seats.
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Amy Errett Joins as CMO
Amy Errett has revolutionized the hair color industry since founding Madison Reed in 2014. As its Founder and CEO, Amy Errett has introduced direct-to-consumer retailing across at-home hair dye products and Color Bar services (touch up services in salons) nationwide. Madison Reed stands for diversity, inclusion, and social purpose – two principles on which it was founded based upon which has amassed over 40 Million in venture capital funding to date.
Madison Reed immediately implemented safety protocols to protect both its employees and customers in response to the pandemic, then noticed sales surge exponentially as its team became busier than ever. Errett took swift action by creating a “war room” with emergency response team members as well as setting up call centers to handle inquiries from new and existing customers, plus hiring 18 licensed colorists as backup.
She coordinated efforts with manufacturing partners in Italy to stockpile bottles, wipes and other essentials in anticipation of an outbreak in other areas. Luckily, Italy wasn’t as affected by coronavirus than other places; she was able to resume production and deliveries to her online store and 87 Color Bars within days.
Madison Reed announced in April a loyalty program with tiered benefits for at-home and in-person colorists, boasting Errett’s full confidence that this initiative, along with others spearheaded by Heidi Dorosin – her CMO – would spur further growth this year.
Errett previously served as a partner at Maveron, the private equity firm co-founded by former Starbucks CEO Howard Schultz, where she focused on consumer facing investments. Additionally, she served as chief asset gatherer at E*TRADE where she built a $200 million business. Fast Company featured Errett on their first ever Queer 50 list as one of their LGBTQ women and nonbinary innovators in business and tech; additionally she was recognized among Bay Area’s 2021 Female Founders 100 list.
She currently sits on the boards of GLIDE in San Francisco and the University of Connecticut Foundation, Common Sense Media, Friends of the Children and Holey Grail Donuts. Additionally, she holds an MBA from Wharton School at University of Pennsylvania as well as a BA in liberal arts from UConn.
Madison Reed Opens New Color Bars
Madison Reed stands out as an online beauty retailer offering hair-coloring kits and touch-up powders directly to customers’ homes, while also opening several physical locations where clients can have these products applied directly by Madison Reed representatives.
Madison Reed is opening three color bars across Virginia, Maryland and Washington DC at an exciting time: in response to coronavirus lockdowns which have driven orders at home for stay-at-home orders from its stay-at-home services like root touch ups and glosses; these new stores will feature hair color specialists staffed with root touch up specialists and glosses as well as being equipped to take reservations online for in-store services via its e-commerce site.
Errett believes having a physical presence will enable Madison Reed to provide its customers with better service, whether that means via phone call or chatbot on its website. Madi, one of Madison Reed’s most beloved features, allows users to upload selfies directly into Madi for matching hair color matches via text messages and Facebook Messenger chatbot.
Madison Reed has found success leveraging retail partnerships through their physical presence. Their wholesale agreements with Ulta and Target (which offer their products alongside those of other brands) are drawing customers to its hair color bars; Errett anticipates 80 Madison Reed color bars by 2022!
Madison Reed’s hair color bar expansion reflects a larger trend: young consumers increasingly seeking healthier, natural and ethically made cosmetics products. Madison Reed is capitalizing on this shift with their own take on traditional hair dye, offering clean label options without ingredients linked to cancer, birth defects or other health concerns.
Madison Reed is developing an array of haircare and styling products designed to make women feel good about what they put on their bodies, according to Errett. She anticipates this shift may help expand business further as other companies shift back towards traditional cosmetics.
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Madison Reed Becomes a Public Company
Women seeking to color their hair at home instead of salons benefited from an expanding selection of direct-to-consumer dyes and other products after the coronavirus pandemic, especially Madison Reed which launched in 2013. Madison Reed quickly gained prominence, drawing fans who preferred products without toxic chemicals like ammonia. Plus they boast high-end branding with higher price points than many competing offerings.
Errett tells CO that proceeds will be used for both marketing and product development; specifically investing in new technology while opening several Madison Reed Pop-Up Color Bar stores that will give customers access to one-on-one hair coloring consultations with professional colorists via Zoom.
Madison Reed offers consumers an omnichannel business model whereby they can order its products online, at Ulta Beauty stores or from one of Madison Reed’s own Hair Color Bar locations. Madison Reed provides salon-quality at-home kits featuring colorist-approved formulations made in Italy that meet strict European Union safety regulations for use at home.
Madison Reed recently expanded their product lineup with products to help consumers maintain results between salon visits, as well as opening a series of Mini Bar locations – smaller versions of its full-fledged salons – for walk-in customers wishing to receive basic root touch up services at $45 each for service completed within 45 minutes.
Stephanie Davis Michelman will join the company’s board as its inaugural black director and has an extensive track record leading growth at consumer brands such as Lancome and NEST. In her new position she will oversee both Hair Color Bar revenue operations as well as online storefront operations.
These new hires will join an existing Madison Reed staff of approximately 50 employees. In 2019, Madison Reed aims to double its workforce and launch multiple Hair Color Bars.
