After three lucrative rounds of venture capital fundraising, home and small business technology installation company Daisy reached $35 million in investment money and increased its valuation by 115 percent, said its founder and CEO.
More importantly, the Costa Mesa, California startup secured the capital to build out its technology stack and provide operators the back-end support needed to grow their businesses, she said.
“The new fundraising money is really exciting and we’re well on a way now to becoming the leading player in this rapidly growing space,” said Hagan Kappler after her company secured an additional $15 million in a Series C funding round from Massachusetts-based Fifth Down Capital. It follows a $7 million Series B funding round in September and an $11 million Series A funding round in June.
“This additional funding enables us to further invest in innovative tools and resources that enhance the experience for our local branches, their teams and, through them, the clients we serve,” Kappler said.
Kappler noted the Series C investment solidifies Daisy’s balance sheet, providing significant cash resources and ensuring continued stability for her company. She said by funding operations through long-term investment partners with no debt, Daisy is building a sustainable business that can fulfill the ongoing needs of its partners, teams and clients through home technology services such as custom audio/visual, shades, control systems, home security and smart lighting design and installation.
Things are moving fast for Daisy, which launched its franchise program a year ago. The company recently announced its 10th acquisition and opened its seventh franchise location. Three of its franchises are conversions.
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With 15 total locations and a plan to open 30 more franchise locations this year, the company has gained leading market positions in California and Florida, with other locations in Connecticut, Colorado, Virginia and Arizona, according to Kappler.
She said the goal is to have between 250 and 500 locations in five years and achieve $1 billion in valuation. The company’s 10-year goal, meanwhile, is to gain a 20 percent market share of a $30 billion smart home industry.
Daisy provides financial performance information in Item 19 of its franchise disclosure document for one corporate and one franchise location, both conversions. The corporate unit in Norwalk, Connecticut, did just over $2 million in gross sales in 2023, while the franchise outlet in Costa Mesa, which the company noted operates in multiple territories across Orange and Los Angeles counties, did $6.2 million in sales.
The cost to open a new Daisy franchises ranges from $141,700 to $308,500; the investment range for a conversion franchise is $36,500 to $258,500.
“Installing AV equipment in your house, along with home security systems, motorized shade lighting, etc., is already a huge industry that’s growing 15 percent annually with no real national leader,” Kappler said. “We want to be the national leader in this space by partnering with the best-in-class operators in attractive markets.”
“Once these independent operators learn what we offer in the way of technology and marketing support, they quickly understand the potential for growing their businesses. They will no longer get bogged down with complicated accounting and complicated HR issues and they can get back to doing what they love,” she continued.
Kappler is leaning on her past franchising successes to accelerate growth for her new company. She held leadership roles at top national brands including ServiceMaster Clean, Merry Maids, Starbucks, Terminix, Trane and Club Car, was the CEO of home services franchise platform company Threshold Brands before departing in early 2023 to create Daisy.
Along with Dion Persson, the co-founder and chief growth officer of Daisy, she came up with a concept that aims to simplify smart home and office technology and make sure it performs as advertised.
Kappler said Daisy invested $2 million of its seed money in building out an end-to-end tech stack and plans to invest another $2 million this year in enhancing its customer relationship management and enterprise resource planning software systems.
“We have also negotiated supply chain relationships and have in place really good programs and policies with manufacturers that give our operators better purchasing power as a group,” said Kappler. She noted the company partnered with one franchisee who became a platinum dealer with one supply company that is already providing “incredible savings.”
Daisy’s fast start and potential to become a major player in the home technology installation and service space were big reasons for Fifth Down’s investment.
“Daisy’s execution has been impressive,” said Andy Spellman, Fifth Down founder and lead investor in Daisy’s Series C, in a statement. “Fifth Down’s top criterion for direct investment is backing compelling founders, and Hagan and Dion exceed our views of compelling. We are excited about Daisy for all involved, especially the customers.”