Spa and salon software startup Zenoti Software has raised $160 Mn in a Series D funding round making it the first vertical software-as-a-service (SaaS) startup in India’s unicorn club. The round was led by Advent International (Advent) through Advent Tech and Sunley House Capital. Along with the participation from Tiger Global Management and Steadview Partners.
Zenoti cofounder and CEO Sudheer Koneru believes that the funding will enable the company to further accelerate the pace of innovation and reposition the industry to address heightened consumer expectations for health and safety during the global pandemic. He added that Zenoti has built its tech solution over the last couple of years, and Covid accelerated the need for customers to adopt it in order to reopen safely. “It is not just better hygiene but IT infrastructure which is touchless and meets the heightened expectations in the stores,” he added.
Founded in 2010 by Sudheer Koneru and Dheeraj Koneru, Zenoti is an all-in-one, cloud-based software for salons, spas, and medi-spas. It boasts of rich capabilities across appointment scheduling, online booking, billing, built in marketing, inventory management, CRM, and loyalty features.
Further, the company will also use the funding to continue scaling operations, support research and development and to fuel further A.I. innovations, including advanced algorithms leveraging Zenoti’s enterprise system data to optimize customer employee scheduling, inventory management, marketing and dynamic pricing to enhance profitability and efficiency.
Zenoti Powering 12,000 Businesses
Koneru told Inc42 that the company will be looking to increase its workforce from 580 to 900 by next year, by hiring across the board with a deeper emphasis on core engineering or product roles. This plan will be in lines with Zenoti’s efforts to double its revenue in 2021. Besides this, the company will also expand its latest offerings in fitness and pet grooming or spas.
“The depth of technology we have built for the industry is like an ERP and CRM integrated specifically for industry. Our ability to help transform this industry and enable Uber-like experiences, empowering businesses to just focus on their craft is helping us accelerate our growth,” Sudheer said.
The company claims over 12,000 business customers in over 50 countries including global brands such as European Wax Center, Hand & Stone, Massage Heights, Rush Hair & Beauty, Sono Bello, Hair Cuttery, Profile by Sanford and, most recently, Toni&Guy.
With this round, the company’s total funding has reached $251 Mn. It last raised $350 Mn in Series C, last year, from Tiger Global, Norwest Venture Partners, Steadview Capital and Accel Partners, among others.
Looking For Covid-Proof Solutions
As the pandemic was clouding over all social gathering and human interactions, Zenoti too found itself in a soup with all its customers shut for weeks. However, the pandemic accelerated the need for tech adoption in salons and spas in an attempt to make their operation more up-to-date and in line with the changes that the entire industry was going through.
Koneru believes that normally, it would have taken 3-4 years of transformation for the industry to reach this point. “They resonated and our messaging was pivoted to help businesses see that opening with higher sanitation standards is not enough. The addition of contactless technologies and elevated guest experiences through software was integral to their reopening success,” he added.