XSPA Group

Objective:

Global category leader XpresSpa Group (NASDAQ: XSPA) with 50 locations across 25 airports had been experiencing 18 consecutive months of falling same store sales and was losing money in 2018. XpresSpa had been started by a founder who was the first to bring Health & Wellness to airports and the company had been an industry darling for years. The founder had reinvested profits into store growth and eventually brought in PE funding to accelerate their massive expansion plans. Unfortunately, the company had never reached profitability which led to the founder being exited and a reverse merger into an existing public company. Doug was hired as the CEO to lead a turnaround in Feb 2019 and inherited a situation which included a falling stock price, the threat of delisting, several expensive debt instruments, damaged airport relationships and several lawsuits leading to an organization with low morale and tired leaders. The objective was to give the organization a reason to believe, increase revenues, slash costs and clean up the messes.

Results:

Doug started with the field organization and spent most of this time in the first few months traveling to a majority of the airport spas asking questions and listening. The first senior team upgrades focused on a solid CFO and a skilled HR exec. The organization experienced a turn in sales within the first month and enjoyed consecutive positive sales for the next 10 months. By the end of the first year, there were new retail products, remodeled locations, a new pricing strategy, improved morale, improved airport relationships, most lawsuits cleared, most of the debt restructured with a stabilized stock price and the company was lined up for it’s first profitable year.

Unfortunately, by March 2020, all locations were shut down as the business was considered a ‘non-essential use’ with the onset of the COVID-19 pandemic leading to a furlough of all but 4 people out of a workforce of 500 people. Facing potential bankruptcy, Doug led a small team pivoting from airport spas to creating the largest US airport COVID testing business in 2020, XpresCheck, which included a CDC contract for the country’s first biosurveillance program and raised $100M in the public market.  Within months, the team created and launched a second startup, Treat, as the first travel health and wellness lifestyle brand. Treat is an innovative BTB/ BTC multi-channel business featuring e-commerce, tele-health in-App subscriptions, and an award winning brick & mortar concept in major airports featuring onsite healthcare services/ wellness services/ curated retail.  In 2021, turnaround financial results yielded a +50% annual revenue increase to $74M over a previous high of $48M in 2019 with it’s first profitable year ever at 15% Adj EBITDA.