Just six months after raising its previous seed round, €62,000 MRR in March 2022, an NPS score of 79 and a churn rate of less than 1%, this startup wants to help hundreds of thousands of European salons with no digital systems in place.
Book Salon, a payment and booking service provider specializing in hair, beauty, and wellness companies, has announced the successful closure of a £2.5M funding round led by Joint Effects. Previous investor, Big Bets VC, also participated in the round. The funding will be used for European expansion with the first targets being the Nordics, UK, Ireland, Spain and Italy.
“We are excited to have the backing of Joint Effects who can help us accelerate the development of our operational capabilities and scale into Europe,” says Book Salon CEO Harri Myllylä.
The startup provides entrepreneurs with a full suite of modern tools to run a successful business. Book Salon offers payment terminals and a payment processing service, in addition to its website builder, online booking systems, and cash and accounting reports.
“Joint Effects and their ambition level is a perfect match for Book Salon. With their help, we aim to disrupt the current Payment Service Provider market, and the hair, beauty, and wellness sector is our first target. We believe that PSPs need to go beyond providing payment processing services. That’s why at Book Salon we also provide access to industry-specific value-adding services and tools that help the entrepreneurs save time, effort, and money,” he continues.
Just six months after raising its previous £0.8M seed round, Book Salon has proved its popularity with over 1,500 clients generating more than €62,000 in MRR in March 2022, a figure which had grown over 20 percent month to month that year. Their NPS score is an outstanding 79, and less than 1% of their clients churn.
“We are very impressed with Book Salon's growth and their ability to efficiently attract customers. We believe the global vertical software market will be growing and Book Salon is perfectly positioned in their chosen segment. There are tremendous growth opportunities in the beauty and wellness sector in vertical expansion such as microfinancing, banking services, integrated bookkeeping and many more,” says Tuomo Vuolteenaho, President at Joint Effects.
The platform’s popularity can be explained with their customer survey feedback. According to the feedback, the platform saves entrepreneurs over 100 work hours a year. Also, the time spent on the phone has dropped over 70 percent to less than 10 minutes per day.
“The Book Salon system works perfectly for the entrepreneur. Payment transactions have been working properly all the time, settlements are on time and there have been no interruptions. Book Salon's system updates tend to the needs of the beauty industry. For example, the most recent commission calculator that calculates the contract tenants' commission really helps in everyday work. All this has made my job a lot easier,” says Piia Koskinen, an entrepreneur at beauty salon Ihanapiste.
In addition, data from Book Salon shows that 52% of appointment bookings happen between 5 PM to 9 AM. This means that salons not using online booking or booking apps are most likely to lose potentially tens of thousands of euros in a year for appointments that are left empty.
“A staggering number of European salons are still relying on pen and paper to manage their bookings. In addition to the lost income, being available to pick up the phone stops your workflow with clients and adds the stress of being constantly available around your phone,” continues Myllylä.
Larger corporate competitors require entrepreneurs to pay per user and commit to lengthy contracts with vague compounding cost structures. Book Salon differs in that it offers its platform to salons and entrepreneurs for free with the option to upgrade to a paid package with an unlimited number of users. This approach makes it uniquely accessible, profitable and transparent for micro-entrepreneurs.
The European beauty and wellness trades are dominated by small establishments that often have fewer than three employees. Additionally, the share of self-employment in these sectors is two to ten times higher than in the whole of the economy.
“Book Salon’s business model appeals to smaller salons that have yet to become digital – approximately 65% of salons in the EU have no booking system or any other digital tools. Most beauty and wellness entrepreneurs are women, often with immigrant backgrounds. We want to help them manage and grow their salons, and focus on providing amazing services with an awesome client experience - not admin or payment-related hassles,” Myllylä continues.