Start-up launches snowball round and expands into Europe
Roholm, the Tauranga company behind the Inverse Hair Conditioning System, has launched a Snowball Effect capital offer of up to $1.5 million to support its push into international markets.
The company has also set up a European office in the Netherlands and concluded distribution agreements in Brazil, France, Germany, the Netherlands and Canada, with minimum volumes totaling 100,000 units in their first 12 months, said acting chief executive Daryl French.
Inverse is a patented hand-held system, manufactured in New Zealand, which uses sub-zero temperature instead of heat and chemicals to improve the condition and appearance of hair.
The new product has created positive interest in the global hair care industry, says Wilhelm Hertig, Inverse’s international business manager, who set up Inverse Hair Europe BV. Based in the Netherlands, Mr Hertig has more than 15 years international experience as a global distributor in hair care and cosmetic niche markets.
“I was really skeptical at first,” Mr Hertig said during a recent visit to Tauranga. “But I became very positive about the design and the idea behind it. There is nothing like this in the market using sub-zero technology – it’s all heat treatments.”
Mr French said the decision to move into Europe was driven by the importance of being close to Inverse’s customers and growth opportunities. The global hair care market was estimated to be worth US$83.1 billion ($116.4b) in 2016, according to data supplied by Roholm. The global shampoo and conditioners segment accounts for a significant portion, at US$34b in 2014.
Roholm said the ultimate market for Inverse was mainstream customers, but the company was utilising professional hairdressing sales channels to educate the market, in conjunction with direct e-commerce to build a blended, high-margin sales approach.
Roholm chairman Murray Denyer said the company was seeking further capital to support the continued growth of its distribution network, strengthen its intellectual property portfolio, and raise consumer awareness.
“Inverse is a completely disruptive new product category in a global market segment that loves innovation,” he said.
The company has already raised funds from existing angel investors in its current capital raising round, which is targeting $335,123, including Snowball Effect investors. The Snowball Effect offer has a minimum target of $264,883 and a maximum target of $1.5 million.
The Inverse system was the brainchild of Tauranga hairdresser David Roe. Roholm is currently based out the offices of Locus Research, which has played a key role in developing the product, which included working closely with AgResearch and Callaghan Innovation.
“We had quite a strict set of technical constraints we needed to use, and we worked very hard to come up with a device that would deliver what it needed to deliver,” said Locus Research general manager Daniel Faris.
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Originally published in the Bay of Plenty Time
By David Porter