How two friends built an app for barbers that makes $15M ARR - Squire ($1.25M MRR)
Today’s case study is going to be about Squire, a business management system (CRM, Directory etc…) for barbershops that makes $10M a year, founded by Songe LaRon and Dave Salvant in 2015.
At first sight, the product seems simple and easy to replicate (read the whole post to find out how); the challenge lies in finding the right niche and scaling it.
Let’s dive into how these two friends created this multi-millionaire business.
Back in 2015, Songe and Dave decided to leave their jobs to pursue their dream of creating a successful startup. Despite having zero experience in tech, they were determined to escape the corporate world.
The idea they chose to start with (after brainstorming) was a booking system app for barbershops. They brought Yas, a software engineer, on board, and together they built the app.
Launching 🚀
Once they launched the app, they managed to onboard 50 barbershops easily but struggled getting customers to download the app initially.
Additionally, they quickly realized that the app wasn't generating new business for the barbershops and was integrating poorly with existing manual workflows, resulting in a poor customer experience.
The gamble 🎰
Songe and Dave recognized that building an app to genuinely support barbershops and enhance customer experiences required a deep understanding of the industry.
Taking a significant gamble, they invested a third of their savings to acquire and operate a barbershop, providing firsthand experience with the industry's pain points.
This hands-on approach was crucial in developing a product that effectively addresses these challenges.
The re-launch 🔄
After gaining experience in the industry it was possible for them to build a product that successfully solves the pain points of the barber community.
Squire's goal was to provide an easy to use, end-to-end system tailored for barbershops, covering everything from booking to online payments, point of sale, back-end activities, CRM, financial services and marketing.
The new app was adopted perfectly by the customers, and they started scaling.
To the moon 🌔
Unlike Pally (Case study #1) , which was bootstrapped (received no external funding) until reaching $1M ARR, Squire secured over $120 million in total funding from various investors and gained acceptance into Y Combinator after facing two rejections. For those unfamiliar with YC, it's the most prestigious startup accelerator.
Squire's journey was a rollercoaster; they faced financial challenges three times but successfully turned the situation around.
In 2019, Songe and Dave expanded Squire's presence to 28 cities in the US, the UK, and Canada, processing over $100 million in transactions. One year later, amidst a COVID-related revenue drop to zero, they responded by launching five crucial products: Gift cards, Virtual waiting rooms, PPP loans, COVID waiver forms, and Contactless payments.
This strategic focus on customer needs paid off, driving Squire's growth from $1 million to $4 million in ARR within three months as lockdowns eased.
In November 2021, Squire reported signing up 2.8K barbershops, adding 400 new signups annually since inception. By October 2021, its revenue had grown from $4 million in 2020 to nearly $12 million. By June 2023, Squire announced processing over $1 billion in total payments and serving more than 3K barbershops.
This story shows that literally anyone can start a successful SaaS. Songe and Dave began their adventure with a clear goal: to change the barber industry. They didn't have much knowledge about technology or the industry at the beginning. It's a story of diving in, learning along the way, and enjoying the excitement of entrepreneurship. The best part? You can embark on a similar journey!
