One of Britney Winters’ goals is to “live a less tangled life.”
She grew up in Houston and went on to attend Stanford and major in engineering. She worked on Wall Street as an investment banker for a few years in New York before returning to Houston with a job in energy. The company Winters was working for sponsored her MBA to Harvard Business School, and it was there that she came up with the idea for Upgrade.
“I was really struggling to find a local extension stylist,” Winters told TechCrunch. “Myself and a few of the other Black female students started taking day trips or weekend trips to New York City to get our hair done. I also had custody of my 16-year-old sister, so I was managing my course load and taking these trips, and it was during one of the those rides that I thought there has to be a better way to do this. Obviously, there’s a huge demand for it, and it shouldn’t be this difficult to access high-quality convenient hair solutions.”
Upgrade is targeting the wig and hair extensions industry, which is poised to be a $13 billion industry by 2026. The company, which raised $1.7 million last year, is among hair businesses aimed at women and people of color, like Rebundle, Morado and theCut, attracting venture capital dollars.
Upgrade’s e-commerce marketplace has two sides: one that enables consumers to choose a vetted stylist and have their wig colored or customized based on their desired look. Remember Mary J. Blige’s hair at the Super Bowl? That was via Upgrade. The other side of the business is a new monthly subscription service for stylists that helps them market their handcrafted wigs, beauty and other digital products and services.
Stylists can manage orders from one place, including direct messaging with shoppers, one-click shipping capabilities, data insights and analytics, safe checkout, payment protection, buy now, pay later options and access to customer ratings.
“I grew up with a lot of hairdressers in my family, so I’ve seen kind of firsthand the challenges of operating a small business,” Winters said. “A hairstylist can help a woman feel better about themselves. However, although they are providing such significant value, a lot of them operate with limited funding and resources, which ultimately affects the customer experience. We’re equipping them with the tools and resources so that they can operate more efficiently and empower themselves economically.”
There is a $30 monthly subscription fee that stylists pay in addition to a transaction fee for purchases. For consumers, there is no subscription fee, Winters said. All of the stylists are independent contractors and set their own pricing. The price a consumer pays depends on the stylist chosen.
All of this is courtesy of a new $1 million seed extension from initial seed leads The Artemis Fund and Mercury Fund, with Bracken P. Darrell and ANIM also participating. To date, Upgrade has raised $3 million.
Winters explained that the driver for the new funding was technology and product development on the marketplace, marketing and stylist acquisition. Thirty stylists are using Upgrade currently, and 300 are on the waitlist.
“One of our biggest differentiators is technology,” Winters added. “Our stylists always rave about just how easy it is to run their businesses on Upgrade, so we decided to productize that technology, make it more accessible to the masses and level the playing field to give those stylists exposure.”
The company also has one retail flagship store in Houston that serves a triple purpose of being a warehouse for the wigs and hair Upgrade sells, a showroom for consumers to come in and feel the hair and pick up orders and a workspace for stylists with private suites for them to rent out. Winters says she is proud of the space, but not aiming to have a huge retail footprint other than some expansion to other large cities, like Los Angeles and New York.
Meanwhile, Upgrade currently has 10 employees, and Winters expects to have double that amount by next year. The company makes money on the wig and hair sales and saw revenue triple over the past year.
As part of the company’s growth, Upgrade is working on an offering of micro loans to stylist subscribers to provide capital for them to invest in inventory. It’s just one of the tools that the company offers to stylists in its network to help them grow their business, which include support for filing a business tax return and creating a profit and loss statement.
Up next, Winters expects the micro loans offering to roll out by the end of the year. The company will be working on additional business resources.
Samantha Lewis, principal at Mercury Fund, told TechCrunch that Winters knows her customers well and could do for them what Etsy did for people who made handmade goods.
“Upgrade is empowering the stylist, on one hand, to help them grow their business,” she said. “With Britney’s background, she is really coming at this from all the different angles, including the fintech angle with the micro loans. She taught me what I needed to know about wigs, hair extensions and the problems that women of color are experiencing when it comes to that. To have a super successful company that’s built specifically for Black and other women of color is inspiring.”
This article was originally published on TechCrunch.com. Read More on their website.