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Fast Facial Bars Continue to Grow – celebritiestalks

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September 1, 2023
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Glowbar closed on its $10 million series A round.
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Fast Facial Bars Continue to Grow – celebritiestalks

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The growth of fast facial bars isn’t expected to slow down any time soon. 

Over the past year, the fast facial market has gained traction with consumers and investors alike. In January, Glowbar, known for its 30-minute $65 facials, closed a $10 million series A round. Last December, Heyday received $12 million in series B extension following a $20 million investment two years before. And while Silver Mirror has been self-funded to date, the model is expanding with plans to close the year with 10 total locations, doubling down on New York and Miami. 

The growth of this market directly reflects consumer interest in wellness services — according to a 2022 report from McKinsey, 45 percent of consumers intend to spend more on wellness services. Meanwhile, the Global Wellness Institute projects the global spa market to be worth $68 billion. With consumers looking to spend more and the solid business model these locations pose, investor interest has remained steady. 

“It’s an incredibly interesting space for investors because the fundamentals are there for the market, meaning that the unit economics for the majority of these concepts are pretty compelling in terms of volume and profitability, and the market dynamics are favorable,” said Marko Horvat, managing director, investment banking at Raymond James. 

Tara Hyland, a vice president at private equity firm Main Post Partners, seconded this.

“Fast facial bars have strong unit economics largely driven by the shorter, targeted service offerings — revenue generated per minute of service being an indicator, as well as labor dynamics and growing membership models,” she said. “It becomes sticky because these concepts lend themselves to consumers who are looking for convenience and customization, not for the frills of what you might find at a four- or five-star resort spa.” 

Glowbar

Kelsey Ann Rose

Glowbar, founded by Rachel Liverman, exemplifies the no-frills model customers are seeking, as guests wash their own face to ensure a 30-minute facial. With efficacy top of mind, the company has also partnered with clinical brands like Environ and iS Clinical and features technologies including stimulating LED light therapy and acne-fighting high frequency during treatments.

“The more clinical and efficacious you can position your offering, the more it will resonate with consumers because the options that consumers have as far as products that they can purchase in retail has improved over the past several years, as evidenced by the rise in clinical skin care and at-home facials, which took share during COVID[-19],” said Hyland.

Heyday, which is expected to have 50-plus locations by the end of 2024, is rolling out a line of 19 professional-grade products, which will be used during facials to push the level of personalization. Other technology additions include microdermabrasion with diamond tip and microcurrent.

Heyday studio.

Heyday

Courtesy

“How we can continue to evolve our core service offerings, but still be a routine space for our clients, that’s what’s core and most important to us,” said Arielle Mortimer, Heyday’s chief operating officer. “We take the time to get to know you, get to know your skin, get to know your lifestyle, and really make sure that we’re fitting your skin care routine into what suits you both from a skin type perspective, but also your lifestyle.”

As with many fast facial bars, including Glowbar, membership models drive the business. According to Liverman, the brand has seen 70 percent year-over-year growth with its memberships.

“People are continuing to be excited about taking care of themselves and their skin and prioritizing it,” she said. “There’s zero guilt about time or your pocket… Our hunch was correct that people really appreciate an accessible facial monthly.”

Glowbar plans to close the year with 10 locations and expects to double in size in 2024. Silver Mirror, which positions itself as a more luxurious fast facial bar, has seen success with its membership models, as well — memberships have grown five times since pre-pandemic, according to the brand.

In an effort to differentiate the model, Silver Mirror has doubled down on adding new services — think hydradermabrasion and jelly masks — and creating a more luxurious experience, as it aims to reach a GenX and Millennial consumer.

“We’re continuously leaning into that higher end of the market and it’s been tremendously successful,” said Silver Mirror cofounder Matt Maroone. “We’re continuously rolling out new technologies.”

With investments and overall growth, brands are planning for expansion and experts predict this will continue through 2024, with several key markets popping up outside of New York and Los Angeles. 

“One place that a lot of people are looking to scale actually is Texas because it has a bunch of major cities in the state,” said Horvat. “A lot of people are talking about general Florida as well.”

Success in these markets will be key for these businesses. 

“The key proof point that a lot of people look for on the finance side of things is demonstrated traction in ‘non-tier 1’ markets,” said Horvat. 

These models are expected to be successful given that there are fewer competitors in these markets, experts say. 

“We’re seeing a lot more infiltration of these concepts in less urban markets, particularly in high-disposable-income areas that are more residential and have less competition,” said Hyland. “These concepts that are in big cities, there’s almost one on every block, whereas in second tier markets or more suburban areas, there’s just not as much competition for consumers or aestheticians.”

As the growth of fast facial bars is indicative of larger consumer trends, other spa models are expected to respond. For example, Hand & Stone, a facial and massage franchise with more than 550 locations, reports 40 percent of its bookings are for facial treatments. In 2022, the company conducted more than 1.6 million facials, resulting in $211 million in revenue and 30 percent year-over-year growth. With this growth, the brand has invested heavily in its skin care business, partnering with clinical brands like Dermalogica and adding new technologies like LED light therapy, NuFace and DiamondGlow with plans to continue expanding the menu for additional personalization. 

“We’ve spent a lot of time heads down, building out this phenomenal menu that we’ll continue to build on, we’ll follow the trends, we’ll look at what’s next,” said Lisa Rossmann, Hand & Stone’s senior vice president, service and product. “For us now we’re looking at more of a sculpting service to come next.”

While offering unique services and efficacious products are points of differentiation and customer acquisition, experts point to education as a key pillar when it comes to sustained growth.

“There’s an education and diagnosis component to it,” said Horvat. “It really comes down to aesthetician training. Is it someone that is customizing the experience for your specific skin conditions, skin concerns, goals, etc. and serving as your partner in crafting a regimen that includes facials once a month? But it doesn’t just start and end there.”

With the growth of fast facial bars, additional service locations, including cosmetic dermatology outpost Ever/Body, are gaining traction. Similar to the facial bars, Ever/Body, which has amassed $110 million in funding, has its sights set on expansion in similar key markets like Texas.

Key Takeaways: 

  1. Consumers want more wellness services, especially facials. 
  2. Fast facial bars have strong unit economics, so new models and additional investor interest are expected. 
  3. Expect increased expansion outside of New York City and Los Angeles — Texas and Florida will be key markets. 
  4. As consumers look for more personalized and highly efficacious services, look out for added technology, treatments and products at fast facial bars and traditional spas. 

Fast Facial Bars Continue to Grow – celebritiestalks

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