Heather Elrod admitted she’s a bit jaded when it comes to claims from beauty brands, which she said often amount to a lot of “marketing puffery.” Then she visited Uni K Wax.
“I’ve tried every waxing product out there, and this is sincerely the best one on the market,” said Elrod, managing partner of Conscious Capital Growth, which in June joined with Exaltare Capital Management to acquire Uni K Wax.
The difference, Elrod continued, is Uni K’s natural, pine-based flexible wax that’s applied at body temperature, is ideal for sensitive skin and can remove even the shortest of hairs. “You can literally stretch a piece of wax from your hip to ankle and remove the hair,” she said, which also translates to quicker sessions and opportunity for studios to increase capacity—and in turn top line sales.
Elrod, who with Christo Demetriades formed Conscious Capital in late 2021, is the former CEO of Amazing Lash Studio, building it from 70 units to 260 and orchestrating its sale in 2018 to KSL Capital, the private equity firm that owns WellBiz Brands. Conscious Capital made its first investment in summer 2022, backing Main Squeeze Juice Co. And in December it purchased a majority stake in hospitality staffing and recruiting franchise Patrice & Associates.
Heather Elrod formed Conscious Capital Growth in 2021 after growing Amazing Lash Studios to more than 260 units as CEO.
The acquisition of 34-unit Uni K Wax, said Elrod, is part of a beauty and lifestyle vertical for her firm, to go along with food and staffing. Conscious Capital, based in Scottsdale, Arizona, targets companies with between $1 million and $1.5 million in EBITDA, which is “not a space where institutional private equity plays,” she said. The firm is also looking for the right opportunity in the pet segment, which she noted is still seeing inflated multiples.
In Aventura, Florida-based Uni K Wax, which Conscious Capital and Exaltare bought from founder Noemi Grupenmager, Elrod said there’s ample opportunity to build upon the strong foundation of a business that started in 1993 and began franchising in 2007. Uni K has “compelling unit economics,” she noted—the average unit volume is $718,334, with top-tier studios averaging $1.3 million—and existing franchisees are eager to open additional locations.
“We spoke with and interviewed every franchisee during due diligence,” said Elrod, “and nearly half want to open more studios right now.”
In tandem with franchise growth, Elrod and Exaltare’s Omar Simmons each emphasized their focus on franchisee profitability and incorporating the operator perspective through every layer of the decision-making process. It’s that perspective, said Elrod, that made Simmons and Exaltare an ideal partner on this deal.
Simmons founded Boston-based Exaltare Capital in 2012, when he bought 15 Planet Fitness locations. He ran ECP Planet Fitness as CEO until 2021, growing it to 108 locations before a sale to TowerBrook Capital Partners. In 2022 Exaltare invested in an Urban Air franchisee, and earlier this year it acquired GF Midwest Inc., one of the largest developers and operators of the Good Feet Store.
Omar Simmons is the co-founder and managing partner of Exaltare Capital.
“One of the perspectives I bring to franchising, and I’m not necessarily unique in this, but the franchisee has to make money. Otherwise, no matter how successful you think the franchisor is, it’s not sustainable,” said Simmons. “I can talk to franchisees and entrepreneurs in a different way. I’ve had to personally put money on the line. I know what it’s like to have to make payroll, what it means to make decisions for the business as an operator.
“I try to bring that empathy to the conversation and to those underlying decisions.”
Simmons said he’d been looking at waxing concepts for many years as he followed the growth of European Wax Center, now with 1,026 locations in 45 states, and others in the segment. Like Elrod, he thinks Uni K Wax stands out from competitors with a superior service.
“I have to believe in whatever I sell, so I had to try it,” he said of getting his eyebrows and nostrils waxed. “I’m African American, and it can work on different types of hair, and it’s not painful.”
Uni K is highly differentiated in the segment, Simmons continued, but the communication about that differentiation was lacking. In the five months since the acquisition, investments have been made to improve the marketing approach and “blast from the rooftops our value proposition.”
Those investments, noted Elrod, serve to drive customer trials, while new package options help increase the frequency of existing customers. Uni K is also testing membership models, and on the operational front is working with franchisees to assess staffing and ensure studios have enough waxers to handle increased capacity.
The brand has locations spread across Florida, New York, New Jersey and Texas, and in addition to filling in those markets Elrod said a white space analysis indicated Arizona and the Carolinas as prime states for expansion. The cost to open a Uni K Wax studio ranges from $390,135 to $650,345.