This beauty startup raised $25 million to defy the retail apocalypse and open stores across America

Facebook/Madison Reed

Madison Reed is defying retail trends by opening brick-and-mortar locations.

• Online beauty retailer Madison Reed is opening Color Bars where customers can have the company's products applied in-person.
• It recently raised $25 million to open more stores.
• While Madison Reed is not the only company to move from online to physical retail, many retail stores are struggling.

While many retailers are shifting away from brick-and-mortar stores to online marketplaces, Madison Reed is doing the opposite.

Founded in 2013, the online beauty retailer developed a questionnaire and algorithm meant to determine the ideal hair color for its customers, as well as software that could make recommendations based on photos uploaded by customers.

Now, the company is taking its personalized approach one step further by opening Color Bars where customers can receive coloring services and consult with professional colorists. Two Color Bars are currently operating - one in San Francisco and one in New York City - and the company plans to have 25 open by the end of 2019.

It just raised $25 million in venture funding to help it do so, according to TechCrunch. The round was led by Comcast Ventures with participation from Norwest Venture Partners, True Ventures, and Calibrate Ventures. In total, it has raised $70 million.

Madison Reed is not the only retailer to expand from an online store to a brick-and-mortar presence, but it is doing so in a difficult business climate. The early results have been positive, according to CEO and co-founder Amy Errett.

"The reaction to our Color Bar concept has been astounding," she told Chain Store Age. "We have focused on catering to women who are comfortable doing their hair color at home, and we will continue to do so. Now with the Color Bars, we also have a solution for women who want the help of a professional Madison Reed colorist, while saving time and money."