Boost Lab And TBH Skincare Merge To Form Holding Company York St Brands

Boost Lab and TBH Skincare have merged to form York St Brands, a Sydney-based holding company that could buy and incubate more brands in the future.

Terms of the deal weren’t disclosed. It was supported by 5 million Australian dollars or roughly $3.3 million in series B funding from Alium Capital, which previously invested in Boost Lab. All told, Boost Lab has raised approximately 8 million Australian dollars or roughly $5.3 million. Prior to its merger with Boost Lab, TBH Skincare was pursuing capital to supplement its till of 710,000 Australian dollars or nearly $470,000 that it garnered through equity crowdfunding, and a friends and family round.

Craig Schweighoffer, who launched Boost Lab with his wife Lisa in October 2020, says York St Brands represents a “merger in the truest sense” of Boost Lab and TBH Skincare’s staff and expertise. The brands’ combined nine-person full-time workforce is moving into a shared office on York Street in Sydney, hence the name of the umbrella company York St Brands.

Schweighoffer will helm York St Brands as CEO. Rachael Wilde, co-founder and head of marketing at TBH Skincare, and Bridget Mitchell, co-founder and managing director at TBH skincare, will become CMO and CFO, respectively. Raj Ghatge, GM of sales and marketing at Boost Lab, will become COO of York St Brands, and chemist Curtis Crasto will be head of innovation. York St Brands is expected to enlarge its team with marketing and operations talent.

A digital marketer in the medical device industry before introducing TBH Skincare in March 2020, Wilde built the acne-focused brand early on in direct-to-consumer distribution. It went from 10,000 Australian dollars or roughly $6,600 in sales its first month to 900,000 Australian dollars or almost $600,000 in sales in 18 months. This month, TBH Skincare entered 402 Priceline stores, a move that Schweighoffer mentions has the brand’s retail sales “catching up rapidly” to the sales it’s been generating online.

Boost Lab plans on harnessing Wilde’s DTC knowledge to accelerate its e-commerce business. Currently, Schweighoffer says the brand’s DTC, retail and export revenues are split about evenly. It’s available at 2,000-plus retail doors in Australia, New Zealand and Southeast Asian countries, including at the chains Priceline, Farmers, TerryWhite Chemmart and Guardian. In the United States, Boost Lab is on Amazon. At York St Brands, TBH Skincare will tap Boost Lab’s retail and product innovation skills. As a whole, the company is projected to hit 10 million Australian dollars or roughly $6.6 million this year.

“What’s very similar across Boost Lab and TBH is we carve out spaces for customers who are typically underserved or not heard.”

Schweighoffer, formerly managing director of 42 Below, a vodka brand scooped up by Bacardi, isn’t a stranger to beauty deals. After he left 42 Below in 2006, he started candle and body care brand Ecoya and then acquired skincare brand Trilogy. In 2018, Chinese company CITIC Capital took over Trilogy and Ecoya in tandem with a few additional brands in a deal valued at $211 million.

In the wake of affordable, ingredient-driven skincare brands such as The Ordinary and The Inkey List arriving on the beauty scene, Boost Lab was conceived of as a brand with accessible, simplified serums for beauty shoppers 40 years old and above. Its assortment contains 11 products priced from $29.90 to $39.95 covering most major skincare concerns. Its bestseller is Eye Reset Serum, and Schweighoffer speculates newly released Edelweiss Neck Firming Serum will break into the bestselling ranks soon.

The history of TBH Skincare dates back to Wilde’s days in the medical device industry, where she encountered the company Next Science’s treatment technology targeting bacteria in biofilms or densely backed microorganisms on the skin. An acne sufferer for 13 years, Wilde tried the treatment technology, and it was a game changer for her skin. In studies, the treatment technology stacks up favorably to salicylic acid and benzoyl peroxide.

Wilde decided to license the patented treatment technology as the foundation for TBH Skincare and designed the brand to be bright and playful in contrast to the clinical, serious acne brands she spotted on the market. The TBH in TBH skincare stands for “the biofilm hack.” The brand has six products priced from $19.95 to $59.95, and its hero product is Acne Hack Spot Treatment.

“For TBH and Boost Lab, we are stronger together. Our revenues have doubled together, and we have a stronger management team together.”

“What’s very similar across Boost Lab and TBH is we carve out spaces for customers who are typically underserved or not heard. From an acne point of view, that customer group has had a lot of shame around their condition. We’re creating a space where they feel celebrated and safe, and giving them obviously amazing products to use,” says Wilde. “For Boost Lab, there’s an entire over 40-something customer group that are completely ignored a lot of the time when it comes to beauty products. We are carving out a space for them to come and feel safe, and we are creating products that are approachable for them.”

York St Brands is out to grow both brands’ product selections by concentrating on their specialties and expand their global distribution. “For TBH, we are serving the acne-prone customer, and we are never going to steer away from that. We are doubling down on that niche segment and finding out exactly what that customer needs,” says Wilde. “The same for Boost Lab. It’s looking at that customer group of women over 40 and what they need at the brand’s price point.”

While the immediate objective at York St Brands is to successfully integrate Boost Lab and TBH Skincare, the company is set up to possibly buy or develop additional brands addressing ignored customer segments the two brands don’t address. “We are going to have corporate ideals that reflect how we live our lives and how we want our brands to be, and those will be nonnegotiable,” says Schweighoffer. “If a brand comes along that ticks all the boxes, we will take a look at it.”

Wilde connected with Alium as she was in the middle of fundraising for TBH Skincare last year and that connection ultimately resulted in the brand merging with Boost Lab. Discussing what it was like to fundraise, Wilde says, “There was a focus on product-based businesses and how you could monetize the business clearly and have a clear path to profitability—and that’s what we were able to present. Whilst it was a tough market, we had some strengths that we could leverage through that process and that’s what led us to the great conversation with Boost Lab, and we are so happy with the outcome.”

Schweighoffer says, “During the height of COVID, valuations were probably two to three times what they are now. So, when you are doing a cap raise now, it’s not on multiple of your revenues, it’s on multiples of your earnings, and that’s a big change in the whole investment mentality and valuations. For TBH and Boost Lab, we are stronger together. Our revenues have doubled together, and we have a stronger management team together. If we have to raise funds down the track for an acquisition, it’s going to be a whole lot easier and not just on multiples of revenue where you have to continue to invest in marketing.”