Urban Massage is the wellness app that makes booking an on-demand massage at home easy and affordable.
Learn more about convertible campaigns.
Self-care. Mindfulness. Stress management. Whatever you call it, we all need more of it, because when we feel physically and mentally strong, everything else gets easier.
So we built a platform that makes booking a massage at home easy and still affordable. Connecting people in London and Paris with expert therapists, ready for treatments at home or the office, morning to night.
With 15 treatments available – from Deep Tissue to Pregnancy massage – and an average treatment rating of 4.85 out of 5, there’s always something to leave customers relaxed, refocused and ready for bed.
All it takes is four taps on the app and then the best bit – you get to completely customise the experience, put on your favourite playlist, light the candles you love, and adjust your temperature and lighting to suit your needs.
And that's just one side, Urban is also about empowering wellness practitioners to build successful businesses too.
This investment round is being raised by way of a convertible equity investment structure, in this case an "advanced subscription agreement".
The key terms that apply to the Urban Massage advanced subscription agreement are set out below. See also attached Key Terms document for further details.
• Discount – conversion at a 20% discount to the valuation set by a Trigger Event.
• Valuation cap of £25,000,000. Please note that the discount does not apply to the valuation cap.
• The Trigger Events include:
o A Qualifying Funding Round – defined as the Company raising investment capital of at least £3,000,000 from one transaction or a series of transactions, in exchange for the company issuing equity Shares.
o A non-Qualifying Funding Round where the majority of the convertible loan note holders by value elect to convert their loan notes into shares (please see the Key Terms document attached to the campaign).
• The Longstop Date is 9 months from the date of the convertible agreement, unless extended by an investor majority (see Key Terms document). If conversion has not been triggered by the Longstop Date shares will be issued on the Longstop Date at a price per share of £0.765. Based on the company’s current share capitalisation structure this would give a fully diluted pre-money valuation of £18,389,296.20.
• Shares will also be issued at a price per share of £0.765 on a change of control or a winding up event.
We believe everyone should have easy, affordable access to whatever makes them feel equipped to handle city life. And we want to make providing those necessary wellness services profitable and flexible too.
After all, city life is hard – an estimated 85% of UK adults say they regularly feel stressed and just a 20-minute commute is shown to contribute to chronic stress and burnout. So unless you’re in the lucky few, there’s a good chance you’re struggling to enjoy the city to its fullest.
So we started Urban Massage to start counteracting this, introducing easy, no-excuse ways for people in cities to practice self-care.
After all, who can’t fit in a 60-minute massage if it’s at home on a Sunday night before bed?
But Urban isn’t just for customers, it was born from the discovery that practitioners are often left earning as little as £10 an hour.
So we flipped the market on its head, managing not only to reduce the consumer price but make it fairer for practitioners too.
Substantial accomplishments to date
- Delivered over 114,000 treatments so far this year.
- Over 3,300% yearly growth in Annualised Run Rate (ARR) since June 2014 to £10.4M ARR in June 2018*.
- 4.7/5 stars on Apple App Store from 2,584 reviews.
- An 'Excellent' on Trustpilot with a rating of 9.1/10.
- Maintaining a treatment rating of 4.85/5 or above for the past 4 years.
- Backing from leading VC firms who have funded the likes of Deliveroo, Farfetch, Monzo and Nested, with £8.3M of equity and debt investment to date.
- Brand awareness of 34% in London and 49% in Paris.
- App Store’s Best of 2017 developers.
- Featured in The Startups 100 in 2015 and 2016 – finalist in the ‘People’s Champion’ category.
- Our CEO and co-founder listed in the Forbes 30 under 30 in 2016.
- Successful launches in Paris, Manchester and Birmingham.
- Leadership team as keynote and panel speakers in leading industry events in the domains of Tech, Creative, Spa and Wellness.
*Source: Unaudited Management accounts
Blended 25% commission from all treatments in the past 6 months.
We recently launched Urban Curates which helps unlock a new revenue stream, through commission on treatments and product sales. Curates treatments are created in collaboration with leading wellness and beauty brands and offer a unique, personal way to explore products in the comfort of your home.
Finally, our plan to launch new categories will allow us to expand our revenue opportunities through wellness memberships, digital subscriptions, space merchandising and product sales.
Use of proceeds
We feel confident we’ve cracked massage.
We’ve developed the technology and expertise to offer a consistently high-quality at-home experience on both sides of the market – with ever-increasing utilisation, efficient use of practitioner hours and good ratings on all platforms.
Now we believe it’s time to widen our offering into more of the services that help you feel ready for anything – whether that’s a PT session that gets you to that first, triumphant pull-up or the hard-as-nails nails that make walking into an interview that bit easier.
So we decided to delay a more significant fundraise to get the benefit of this wider Urban vision and activation. Our community funding, along with institutional investment, will be used to help accelerate our user and practitioner growth, and support our engineering team as they work to launch these new services.
Here’s the breakdown:
Please note that the company has a £1m loan facility that was drawn down £600k as at 30th June 2018. Funds raised in this campaign will not be used to finance this loan.
The health and wellness industry in our target markets – the EU and US – is currently valued at $319bn.
Massage provided a gender-neutral foot into the industry and a great way to make people feel better, fast. And with just massage in London and Paris we’ve tapped into what we've estimated to be a $1.1bn market.
With the launch of our new services, starting in September 18, we’re expanding this to an addressable market that we estimate is worth $7.5bn.
That’s just the consumer side and we're seeing that even that’s growing as we see more people turn to new and better ways to solve their stress, anxiety and tiredness.
On the corporate side, we’re seeing huge trends in workplace wellness as they battle to combat ever-increasing workloads and prevent churn and employee dissatisfaction. It’s no surprise, when stress is estimated to cost American businesses $300 billion a year, that it’s a huge market for us too.
Urban Balance, our workplace wellness offering will provide in-office wellness activities such as yoga, massage and meditation.
Characteristics of target market
Urban is targeted at men and women living in cities between the ages of 25 and 50.
And it's for everyone. For example, we’ve found that people living in rented accommodation and earning a household income of £30-34k per year are the most likely group to have massages once a month or more.
Time and money are key.
52% of Londoners said massage is too expensive*. So we worked to fix that, introducing an off-peak price at £49 to stop people being priced out.
Our research shows that 20% of Londoners say they don’t have time for things like massages, supported by recent research that showed that while 83% of Millennials say they’re trying to exercise more, 52% of them will skip it when they’re stressed.
Considering stress relief is the biggest prompt to book something like a massage (the prompt for 41% of Londoners*), our focus is on reducing these blockers and making it easier not to skip important activities that improve a person’s health and wellbeing.
* Based on Urban Massage's research.
We’ve already achieved strong brand awareness and recognition in both London and Paris – 34% in London and 49% Paris.
As a result of this awareness and our high ratings, our brand advocacy is strong – with our referral programme and word of mouth contributing to 62% of our monthly acquired customers. We have a strong network effect, as every other customer we acquire will bring another friend on board too.
On a monthly basis, we acquire new customers through various channels including:
- 38% - Paid channels (Google Adwords, Facebook etc).
- 30% - Friend referral programme.
- 32% - Organic / brand equity / word of mouth.
This allows our CAC (customer acquisition cost) to remain relatively low, allowing for a CAC recovery at month 2*, which means we can recoup and re-invest our marketing budget quickly and therefore afford to spend more to grow.
We are also exploring new and innovative acquisition channels to expand our audiences through Urban Curates and corporate wellness.
*Source: Unaudited management report.
With the majority of the wellness industry made up of solo practitioners and the rest occupied by small high-street operators, it's a fragmented market, which makes finding affordable and high-quality services difficult.
There are other apps in our field but with our early-mover status, high awareness and scale, we believe that we've achieved enough of a market gap to maintain our advantage.
As we move into a wider set of services, we will inevitably overlap with other marketplaces or directories, however we're confident that our value proposition is a compelling differentiator.
Finally, our proprietary technology allows our customers to book appointments in a more natural way, giving them flexibility over location, time and practitioner selection. A value that our customers have told us they love.
For practitioners, they are able to use our proprietary apps to manage their schedules effectively while allowing us to sort their logistics and routing. Effectively, all they have to do is press play and do what they love.
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