Zenoti, a Bellevue, Washington-based startup developing booking software for the spa and salon industry, today announced that it’s raised $20 million from Steadview Capital, bringing its total raised to nearly $100 million following a $50 million series C in May 2019. The fresh capital will be used to expand the company’s presence in the U.K. and to bolster its global marketing efforts, said CEO Sudheer Koneru.
“Steadview has a keen eye for SaaS opportunities, and we couldn’t ask for a better partner to help us cement our leadership position and rapid growth in the industry,” added Koneru. “With more than $91 million raised to date, Zenoti is poised to accelerate adoption of our proven platform on a global scale, and continue to drive exceptional growth through a variety of strategies including innovation, expansion and acquisition.”
Zenoti was founded in 2010 by Koneru, Anand Arvind, Dheeraj Koneru (Sudheer’s brother), and Saritha Katikaneni, seeking to build a holistic management solution tailored to the needs of companies in health and wellness verticals. Its cloud-based platform enables customers to pay directly from a mobile app after their appointments and automatically check in when they walk into a store, and it notifies providers and handles things like booking appointment time updates and the transfer of tips to staff bank accounts.
Zenoti’s accounting and point-of-sales component charges customers a fee per transaction, and it doesn’t levy fees for refunds, authorizations, or failed charges. Additionally, it lets customers store cards or use a single merchant for payments made in-store or online, and it supports recurring payments and accepts full or partial charges and gift cards.
As for Zenoti’s AI-powered Smart Marketing feature, it attempts to fill the coming week’s appointment book automatically by targeting the “right” number of customers to generate responses. Meanwhile, on the analytics side of the equation, Zenoti’s centralized dashboard captures single guest profiles and allows managers to run aggregate reports, kick off campaigns for the entire network, and more. All the while, the platform juggles employee payroll, commissions, bonus, performance, and attendance, tracking payroll based on hours worked and performance metrics against goals like customer satisfaction and retention rates.
Zenoti counts among its customers over 5,000 salons including Mario Tricoci, Prose, Urban Nirvana, Nurtur, Rudy’s, and Waxing the City; the spas at MGM Resorts, Massage Heights, The Bellagio, Elemis, Sandos, Urban Float, and Crown; and medical spas including NutriDrip, OrangeTwist, BeBalanced, Quick, Dermal, SonoBello, Simply Life, and Bioessence. It announced today that Hand & Stone Message and Facial Spas, a 400-plus unit message and facial spa franchise with locations in 33 states and Canada, chose Zenoti as its tech partner for point-of-sale, digital marketing, and analytics.
“We’re excited to partner with Zenoti to offer a highly personalized and modern spa experience for our guests and members,” said Joe Brauer, chief technology officer at Hand and Stone. “We started our evaluation of software providers knowing we needed a proven cloud-based system that could reliably support our network of spa locations. Zenoti stood out as the most robust platform, and as a partner that will lead with innovation for years to come. Their solution provides a one-stop business management tool capable of supporting our business’s custom workflows, for the individually tailored spa experience that our guests have come to expect.”
Zenoti is far from the only company attempting to corner an appointment scheduling software market anticipated to be worth $360 million by the end of 2024, according to some analysts. London-based Schedul, which similarly targets the beauty and wellness industry, raised $20 million in venture capital earlier this year at a valuation of over $100 million, while Barbershop management solutions company Squire just two months ago raised $8 million. Separately, San Francisco-based StyleSeat has raised over $40 million in venture capital to date.
But investors like Ravi Mehta are confident Zenoti has what it takes to stand out from the competition.
“Zenoti is realizing our vision of service entrepreneurs, addressing the most common pain points for business owners in the fast growing beauty and wellness industry with a cloud-based platform that is miles ahead of the competition and driving rapid growth,” said Mehta, founder and managing director of Steadview Capital. “We are excited to support Zenoti on its fast track to global expansion as it continues to raise the bar for customer service in spas and salons around the world.”
Zenoti’s previous and existing investors include Tiger Global, Accel, and Avataar. Coinciding with this latest round of financing, software-as-a-service (SaaS) platform and technology industry veteran Guy Weismantel, who previously held roles at Pushpay, Marchex, Microsoft, and Expedia, was appointed Zenoti’s senior vice president of marketing.