Madison Reed just raised another $25 million funding, led by Comcast Ventures, an earlier investor, to roll out 25 Color Bars, bringing total funding to $70 million for the four-year-old company. This comes on the heels of $13 million of venture funding in February 2017.
WHO: Madison Reed was founded in 2013 by Amy Errett, a former Maveron partner and a current special adviser to True Ventures. She told WSJ that she left venture investing behind when she realized how hair dyes sold at groceries and pharmacies failed to satisfy demand in a massive US market. Madison Reed is disrupting the $50 billion hair care industry by using technology in creative ways to make the at-home hair color experience a more luxurious, fearless, happy process. The direct-to-consumer line has quickly become recognized as a category leader thanks to a nutrient-rich hair color formula crafted without ammonia, parabens, resorcinol, PPD, phthalates, and gluten—the irritating chemicals typically found in hair color. The brand started as a direct-to-consumer e-commerce player garnering attention for its simple-to-use hair color quiz and mobile app. Last year saw expansion on QVC and in Sephora, but the majority of the company’s sales are still direct-to-consumer, and the company expects to keep it that way.
Comcast Ventures, the venture capital affiliate of Comcast Corporation, invests in innovative businesses that represent the next generation of entertainment, communications, and digital technology by partnering with entrepreneurs who have the vision, passion, and tenacity to succeed. Most investments are in the advertising, consumer, enterprise, and infrastructure sectors. Comcast Ventures provides its portfolio companies with countless resources, relationships, and know-how to help them perform at the highest possible levels.
WHY: This round of capital will be used to fund the company’s current business, and expand its physical footprint: Madison Reed Color Bars—currently in New York City and San Francisco—will open in 25 locations by the end of 2019. Locations will be determined from the data gathered from customers and its database of more than 700,000 email addresses.
IN THEIR OWN WORDS: Because a large share of consumers don’t want to color their hair at home, the Color Bars were always part of Madison Reed’s business model, Errett told Internet Retailer. “We launched three years ago,” she says. “We spent three years scaling the online business, now we’re seeking to address the rest of the market.”
“We have been a minority investor in Madison Reed and have worked closely with the company on TV and media expansion,” said Sam Landman, managing director, Comcast Ventures, in a release. “We have watched the growth and execution, and we wanted to be a larger investment partner to the company as they scale and add Color Bars to their already fast-growing business. We are delighted to lead this round and look forward to the continued growth and success.”
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