GlossGenius targets the beauty industry to meet rising demand for SMB fintech
- GlossGenius, a business management app, is the beauty and wellness industry’s first dedicated fintech platform.
- The company offers embedded payments, personalized card readers and lending options to its customers.
GlossGenius is a business management app for business owners in the beauty and wellness industry to manage their bookings, marketing, payments, and loans. The app also provides business analytics tools to educate users on their own finances through easy-to-understand reports.
The beauty and wellness sector represents a large subset of the SMB industry that includes spas, salons and studio owners. With few technology solutions designed for these types of businesses, GlossGenius’ founder and CEO Danielle Cohen-Shohet wanted to create an app that would address the modern needs of business owners that had traditionally used pen and paper or other legacy solutions.
She recognized the fragmentation of tools as a problem that ends up impacting many small businesses financially, particularly in the beauty and wellness industry.
“It’s hard for business owners to access integrated reporting, reconcile payment processing activity with client activity, and understand their books,” Cohen-Shohet said.
Cohen-Shohet started coding the app herself in 2016. A year and a half later, the company launched a core product and was starting to earn revenue.
In 2021, GlossGenius surpassed $1 billion in gross merchandise value, working with tens of thousands of customers, two-thirds of which are women-owned small businesses. The app is now the most popular all-in-one technology solution used by the beauty and wellness industry.
“We're the only product that’s entirely mobile first, which is an advantage because most business owners are in a studio or in a salon, not sitting in front of a computer. They can access powerful tools, features and education wherever they are,” she added.
The company recently announced it raised $16.4 million in a Series A funding round led by Bessemer Venture Partners. Participants included Shopify co-founder and CEO Tobias Lütke, Toast CEO Chris Comparato, Toast co-founder Aman Narang, Mindbody co-founder Robert Murphy, Yelp executives as well as former Venmo executives.
Essential features: embedded payments and lending
The GlossGenius app features embedded payments, allowing small business owners to move from servicing clients to collecting payments, to then rebooking them and getting them back on the books all in one simple integrated workflow.
Ensuring payments were completely integrated in the app was “a big lift”, but a crucial part of the business owners’ experience, Cohen-Shohet said.
“Recently we've seen the promise of embedded payments, but the landscape was different a few years ago. In the beginning, I would say it was a lot more challenging to figure out and navigate, because there were a lot fewer companies doing it, and only a few that were doing it in a truly embedded way.” she added.
Digital payments were also integrated with GlossGenius’ first hardware product, a card reader. It can accept any form of payment: chip cards, contactless, Apple Pay and Google Pay, and debit or credit cards across all major brands. GlossGenius charges 2.6% for any payment, which the company says is the industry’s lowest payment processing rates.
And besides functionality, the company also focused on aesthetics, issuing a modern-looking product that comes in multiple designs. The card readers sold out in 24 hours initially, and went viral on social media among the salon community.
But when the pandemic started to impact businesses in the industry, GlossGenius redirected its attention towards helping customers navigate the shutdowns. It added an easy method for business owners to apply for loans, which wasn’t difficult as the company already managed their financial data and could communicate effectively with banking partners.
“We added loan features quite quickly. We struck relationships with lenders and in little less than six days we facilitated over $40 million in loan applications. It was easy for us to help business owners send in reports that were relevant and actionable and understandable for the banking partners on the other end,” Cohen-Shohet told Tearsheet.
Adding lending options was an important moment for GlossGenius as a company, as it was able to help business owners financially during a challenging time. The company is planning to add other financial solutions including reporting and educational resources.
“In the future, we see a lot of opportunity to continue to go deeper into financial services for business owners here,” Cohen-Shohet said.
Leading by example
GlossGenius also prides itself in empowering women-led and minority-led small businesses and entrepreneurs.
“I'm proud of the diverse base of customers we get to empower. There's a very powerful aspect of social mobility that vertical software and embedded payments companies like ours enable,” Cohen-Shohet noted.
The company is also run by women, and its CEO Cohen-Shohet hopes to set an example as a woman entrepreneur in fintech. As an analyst at Goldman Sachs, she was drawn to the idea of building something of her own.
In college, she had worked as a freelance makeup artist, experiencing first-hand how the beauty industry was underserved and the need for better technology. She was also interested in the payments space, having started an app that digitized receipts at the points of sale, and taught herself how to code.
Finally, she combined her interests, experience, and skills to develop GlossGenius.
Her journey didn’t come without its challenges, but that is always the case when starting your own business, she says.
“In tech, and particularly in fintech, there are fewer and fewer females at successive stages.”
“Making sure that you're focusing on customers and growing the business is one of the most effective ways to overcome any hurdle. Because at the end of the day, it's hard for anyone to dispute real traction and customer love for your product,” she said.