By Lori Hawkins Austin American-Statesman
WWR Article Summary (tl;dr) Alissa Bayer launched milk + honey after earning an MBA from the University of Texas. After raising a small amount of money from friends and family and securing an SBA loan, Bayer opened the first milk + honey in downtown Austin in 2006. In 2018, the company posted $20 million in revenue.
With a new $7 million infusion, milk + honey, the Austin spa and beauty brand, is planning new locations and a retail push for its product line.
Founded in 2006 Alissa Bayer, milk + honey operates four spas in Austin, one in Houston and one in Fort Worth. The locations offer a full range of spa treatments including massages, facials, waxing, body treatments and nail services.
"We're actively looking for two locations in Los Angeles," Bayer said. "Milk + honey is also expanding its salon location in the Arboretum Market to a full-service spa with over 10,200 square feet."
In addition to additional spas, milk + honey wants to make its line of natural beauty products for the body, face and hair available at more retailers. The products are currently sold at Neiman Marcus stores and milk + honey's website.
The lead investor in the deal was Keller Capital of Austin, with participation from Emil Capital Partners of Greenwich, Conn., and Austin-based entrepreneur, author and podcaster Tim Ferriss.
Bayer launched milk + honey after earning an MBA from the University of Texas.
"Instead of getting a traditional post-MBA job I though really hard about what it is I wanted to do and how I wanted to make a living," she said. "I decided that starting a spa and positively contributing to peoples' lives was a great way to make a living, and fortunately that turned out to be true."
After raising a small amount of money from friends and family and securing an SBA loan, Bayer opened the first milk + honey in downtown Austin in 2006. The company posted $20 million in revenue in 2018 and expects more than $25 million in revenue in 2019, Bayer said. Milk + honey is profitable, she said.
"One of the main reasons I waited so long to raise outside money is that milk + honey is really focused on taking care of its team, and I wanted to make sure we were providing a stable, well-organized environment that offers all the benefits you would expect in a traditional job," she said. "And, I wanted our investors to be on board with that and understand that profits are not the only measure of our success."
Milk + honey currently has 425 employees, who are considered full-time if they work 24 hours a week. Full-time employees receive paid vacation, health benefits and a 401(k) matching program.
"Having paid vacation and other benefits is really a core part of our DNA," Bayer said. "I feel if I would have taken funding earlier there would have been a lot more pressure on the bottom line."
Bayer said milk + honey expects to pursue additional funding in the next three to five years.
"The current funds will allow us to grow aggressively for the next few years," she said. "I sold a very small amount of equity at this stage, in anticipation of raising a much bigger round in a few years, to help us really scale and bring milk + honey to more markets."