Hair color company Madison Reed has raised more than $50 million in venture capital, bringing its total funding to date to $121 million. Previous investors Norwest Venture Partners and True Ventures led the Series D round. The beauty startup sells hair care and color kits online, as well as through its wholesale partnerships and chain of eponymous salons. According to Amy Errett, founder and CEO, the Series D will fund the growth of all three channels.
“We’re not an omnichannel because it’s a fad,” says Errett. “For consumer-facing companies in the beauty category, all that matters is what customers want and meeting them where they are.” Errett launched the San Francisco-based startup in 2013 and has since grown it into a team of 190 employees. Last year Madison Reed pulled in more than $50 million in annual revenue.
Errett, a former E-Trade CEO and venture capitalist, gravitated toward the beauty industry after learning that while 75% of women dye their hair (52% of them color at home and 48% at salons), the $15 billion industry, long dominated by Clairol and L’Oréal, was in need of major touch-ups. She drew inspiration from Dollar Shave Club, Harry’s, Birchbox and other wildly successful subscription startups. In addition to delivering dye kits directly to the customer, Madison Reed uses a mix of augmented reality, artificial intelligence and uploaded selfies to help users find their perfect color match online, be it subtle cinnamon brown highlights or a full head of silver ash. It also operates a call center staffed with certified hair colorists.