Companies that spun out of Seattle startup studio Pioneer Square Labs over the past few years dabble in industries such as esports, cloud computing, real estate, advertising, sales tax, and virtual reality.
Now you can add beauty to that list.
The latest startup out of PSL is called Gemma Labs, a new company that sells custom-formulated shampoos. A SEC filing posted this week reveals that it raised a $600,000 investment. Listed on the filing are Mike Galgon, managing director at PSL, and Allison Harr, an entrepreneur-in-residence that joined the studio in July.
Harr confirmed with GeekWire that Gemma Labs is a PSL spinout and is raising a “small seed round to investigate an innovative e-commerce concept in the beauty space,” but wouldn’t share more details. Harr previously was a marketing director at companies including Vestar Capital’s Sun Products; Unilever; and American Express.
Gemma Labs uses in-house scientists to concoct special shampoos for individual customers, based on surveys they take that assess individual hair and scalp needs, in addition to seasonal factors. Prices start at $20. Here are the questions on the quiz:
- Which of the following describes your hair?
- What are your most concerning hair problems (choose up to three)?
- Do you chemically treat your hair?
- Weather and environment where you live can have a significant impact on your hair’s needs. What is your zip code?
- Do you frequently use thermal styling tools (blow dryer, straight iron, curling iron, etc.)?
- In the next month, do you expect your hair to be frequently exposed to any of the following?
- How often do you typically shampoo and condition your hair?
There are other startups with similar business models. New York City-based Prose launched a year ago and raised a $18 million Series B round in November. Prose sells 8-ounce bottles starting at $25.
“The traditional [fast-moving consumer goods] model, based on consumer segmentation and upfront mass production is coming to an end,” Prose CEO Arnaud Plas said in a statement in November. “It generates frustration for customers and waste for the planet. What we’re building is a modern beauty company for the new generation.”
Another competitor is Function of Beauty, another New York startup that raised a $9 million Series A round in January 2017.
Traditional beauty companies are struggling to keep up with new startups such as Glossier and Kylie Cosmetics, The Wall Street Journal reported in November, pegging the U.S. beauty industry at $52 billion.
Seattle is not exactly a hotbed for consumer-focused startups, let alone those selling beauty products. However it was home to Julep, the once high-flying online cosmetics startup acquired in 2016 by a parent company that just filed for bankruptcy and shuttered Julep’s Seattle office.
Pioneer Square Labs launched in 2015, using the concept of rapidly testing and validating new ideas before recruiting an executive team to build out a spinoff company. The firm last year expanded, raising a $80 million venture fund called PSL Ventures, a separate entity from PSL Studio. It allows PSL to invest in startups that they like, but don’t necessarily fit into the Studio model.
Recent PSL spinouts include NextStep Interactive, Gradient, and Shujinko. PSL Managing Director Geoff Entress told GeekWire this week that PSL will spin out six to eight companies this year, with the Ventures fund participating in their financings. The Ventures arm will make five or six new investments in companies not associated with the Studio, Entress said.
