- Investment sought:
- Discount offered:
Learn more about convertible campaigns.
blow LTD is a leading UK tech-enabled beauty business which delivers expert beauty services to your door.
It is disrupting the £15B UK beauty services market by offering premium beauty services to busy women at a time and place that suits them.
Instead of trekking to multiple venues, the blow LTD app makes it easy to order 50 different beauty services, including blow dries, make-up, nails, massage and spray tans, directly to your home, hotel or office.
blow LTD also offers the convenience of treatments outside traditional salon hours - 7 days a week, from 7am until 10pm, at 2 hours notice.
Quality is at the heart of blow LTD. blow LTD beauty professionals have been handpicked and rigorously tested and vetted. They use only premium beauty brands (Kerastase, OPI, Decleor) and have a consistently-maintained customer satisfaction score of 97%. In-app consultation data collection means blow LTD also offers treatment and product recommendations for a super-personalised customer experience.
This round is being raised by way of a convertible instrument. The key terms of the convertible are set out in the Key Terms document attached in the documents section and summarised at bottom of the campaign.
As technology disrupted the food (Deliveroo), ride-share (Uber) and fashion (ASOS) industries, technology can enable ground-breaking convenience in the way we book beauty services.
We believe this technology will grow in penetration and disrupt the physical salon market, lowering in store frequencies and changing customer expectations. blow LTD is one of the leaders disrupting the £15B beauty market in the UK.
Traditionally beauty is a creative industry but we have learnt to maintain 97% customer satisfaction at scale, with learnings from the restaurant industry. We aim to recruit the very best professionals (<5% accepted), offer full flexibility and earnings (~2x a salon) and proactively manage the customer experience.
The by-product of our ‘digital journey’ is rich consultation data from every service, enabling us to offer personalised product recommendations. Targeted product offerings is the goldmine at the end of the On Demand model, exciting the leading beauty brands we partner with.
Substantial accomplishments to date
Since launching the tech-enabled business three years ago blow LTD has grown fast with x3 sales in 3 years, reaching an annualised Q4 2018 run rate of £6.5M*.
blow LTD has successfully:
- Delivered over 360,000 beauty services across the UK. Growing to a peak of 15,000 services per month.
- Consistently maintained a 97% customer satisfaction score from over 50,000 reviews
-Built an email customer database of over 200,000 and a professional database of over 20,000
- Launched and grown outside of London in two new UK cities, Birmingham and Manchester
- Built award winning, cutting edge in house technology to deliver a seamless customer and professional booking journey
- Developed a beauty professional recruitment funnel that delivers high quality customer experience, at a cost of less than 30p per job and is cross category
- Featured in high-profile press such as Vogue, Financial Times, Grazia and Elle
- Built partnerships with leading brands such as Kerastase, OPI and Decleor
- Backed by leading investors such as Unilever Ventures and the former CEOs of ASOS and Net-a-Porter
As well as focusing on fast growth during this initial phase of the business the board and management team have also been heavily focused on building out strong unit economics, which we believe will allow the business to reach good levels of profitability as it scales.
The business is already yielding what we believe is an attractive payback and lifetime value vs cost of customer acquisition, based on the high repeat and frequency of our customers, due to our business model of delivering high quality services.
*Based on unaudited management accounts.
Current monetisation strategy:
Blow LTD prices services to the customer at £1 per minute and takes 40% commission per service.
In addition we have physical beauty bars which generate revenue through services and products.
Future monetisation strategy:
In Q4 2018 we launched our first academy courses, training people to be 5* nail and blow dry professionals in just 4 weeks. These courses support us in delivering expert services to our customers but are also profitable. Long term, we believe this gives us a path to converting our professional recruitment into a profit centre.
Through the in service consultation data we collect we have started to test making personalised product recommendations to customers via email channels. The initial results of these tests are incredibly promising with open rates 80% higher than industry averages.
Finally we are exploring the launch of new service categories, new markets and service subscription packages, all of which will enable us to expand our revenue streams.
Use of proceeds
Over the last 3 years we have built a repeatable and scalable process that enables us to provide customers with high quality, convenient beauty services across 10 categories and 3 UK cities, at unit economics that we believe can scale to profitability.
With this round of investment we are ready to accelerate our growth, deepening our penetration in the UK and launching our first international market. Whilst also exploring ‘how to get big quickly’ through consolidation. From our first international launch we will create a playbook that will then be the blueprint to supercharge further roll-out. Our focus to date on operations and tech means many processes will remain centrally controlled, resulting in an efficient and cost-effective roll-out.
Seedrs funding, alongside our institutional investment from Unilever Ventures, will help blow LTD to strengthen our hold on the UK market, accelerate our international roll-out and position us to lead the disruption of the beauty services market.
Please note that certain existing investors in the company hold preference shares. The preference shares carry the right to receive 1x the original subscription price back in priority to ordinary shareholders, in the event of liquidation or sale of the company OR the option to participate in the proceeds pro rate to ordinary shareholders. The original subscription price for these investors is £300k.
Convertible key terms
This convertible differs in a few key ways from Seedrs standard convertible instrument, so please read carefully. In particular, there are a few discretionary elements to the convertible mechanics. As Unilever Ventures is the lead investors in this round, their decision on certain elements will bind all investors in the round.
TRIGGER EVENT CONVERSION
• Shares will be issued on a Trigger Event (if one occurs prior to the Longstop Date), at a 22.5% discount to the price set by the Trigger Event.
• No Valuation Cap applies to this convertible.
• The Trigger Events include:
- A Qualifying Funding Round – defined as the Company raising investment capital of at least £2,000,000 from one transaction or a series of transactions, in exchange for the company issuing equity Shares; or
- A change of control transaction or an IPO.
LONGSTOP DATE CONVERSION
• The Longstop Date is 20 June 2020
• If conversion has not been triggered by the Longstop Date, all convertible investors convert to equity on the Longstop Date at a share price that is 22.5% lower than the Fair Market Value at that time. Fair Market Value will be determined by agreement between Unilever Ventures, as the lead investor, and the Company. If they cannot agree, an independent financial advisor will be appointed to determine Fair Market Value.