Connect with us

Published

on

Embattled nail salon Glosslab has been scrambling for cash despite celebrity backers that include former Miss Universe Olivia Culpo, The Chainsmokers and rapper Lil’ Yachty — and some insiders claim the company is in danger of shutting down for good, The Post has learned.

The New York-based chain — which has touted a water-free, hygiene-minded approach to manicures and monthly memberships for unlimited access to its salons — has been mired in chaos under founder and CEO Rachel Apfel Glass, according to former employees.

As reported by The Post, Glosslab has lately been accused by landlords of skipping hundreds of thousands of dollars in rent, even as it has shuttered stores. Insiders blame an overheated and chaotic expansion under Glass — with multiple sources claiming she was nowhere to be found even as the company unraveled.

“She had no interest in the day-to-day operations of this business,” one former employee said of Glass, asking not to be identified. “Rachel was fully absentee. Her interest was in picking out nail polish colors for Instagram posts.”

Another former executive said, “Rachel was very interested in doing podcasts and being a working mom She was trying to build a personal brand but neglecting the brand she was running.”

Glass declined to be interviewed for this article. A spokesperson for Glosslab said former employees’ allegations that Glass was “hands off” and “absentee” were “a very inaccurate characterization” of the executive.

Glosslab recently defaulted on a $5 million loan from a key partner — Joshua Coba, the co-founder of publicly-held European Wax Center, sources said.

Last year, Coba bought seven Glosslab salons, becoming its first franchisee and agreeing to expand the franchise nationwide. But now the stores he bought are affiliated with New York company in name only, former employees tell The Post.

“It’s a delicate situation,” another former employee said, adding that without Coba’s support the company has a “bleak future.”

Asked about the rift with Coba and the $5 million loan default, a Glosslab spokesperson did not deny the allegation, but called it “inaccurate,” declining to elaborate. Coba didn’t respond to requests for comment.

The Chainsmokers declined to comment. The Post reached out to Culpo and Lil’ Yachty for comment.

Faced with a dire shortage of licensed nail technicians, Glosslab has resorted to costly and bizarre measures — including buying Uber rides to send workers from Manhattan to understaffed salons in Westport, Conn., and Hoboken, NJ — a roundtrip that could easily top $300, former employees told The Post.

In addition, New York-based technicians were handed daily cash bonuses of $150 to $200 to cover shifts in newly opened salons across state lines, sources said.

The bigger problem, according to insiders: The company has long fielded complaints that it hired underqualified and unlicensed technicians — who kept their jobs despite mishaps and concerns raised by customers, employees and city inspectors alike.

Glosslab was so desperate for workers that “if nail techs had friends or family that wanted to work, we would have them train at one of the locations alongside another licensed technician,” a former employee told The Post. “They’d train for four or five days and then be sent to Glosslab.”

According to another former employee, “We had numerous instances of nail techs cutting clients, or giving them botched manicures. When clients would complain, the company would throw money at the problem by giving them a free manicure or even free memberships in hopes they wouldn’t leave a bad review.”

A Glosslab spokesperson responded that “all of Glosslab’s technicians are licensed,” and that, “As is common practice in the industry, Glosslab offers free services to correct manicures if a customer isnt satisfied.”

It wasn’t just customers that Glosslab was deceiving — but also prospective investors as the chain scrambled to raise cash, according to sources.

“Whenever an investor would be visiting the store the company would place fake appointments in our books so we would look busy, even going as far as having employees of the company sit in and get their nails done to give the illusion of a successful business,” a former employee claimed.

“Many managers would be upset about that because after the investor would leave they would delete all the fake appointments out of the books,” the source added. “These appointments took up slots that actual paying customers could have taken causing that store’s metrics to be down for that day.”

A Glosslab spokesperson responded that “this is untrue,” adding, “Glosslab pays its staff for every appointment. Staff were never asked to provide services for which they were not compensated.”

Glass was recently “looking for more investors, but [she’s] concerned about sharing why there’s so many closures,” added a worker, who was laid off last year and spoke on the condition of anonymity.

As for Coba, he doesn’t pay royalties and has severed ties as a partner after Glosslab defaulted on his loan. Coba stepped down from EWC’s board in 2021 and runs his own franchising consulting business.

“Glosslab is not supporting him as a franchisee because they dont have the resources to,” said a former employee. “They are not doing any of the things that a franchisor does.”

Insiders say the company began spiraling out of control during the pandemic after it partnered with The Lab, a Brooklyn-based angel investment firm. Co-founded by Andy Stenzler, who started the Rumble boxing fitness chain, The Lab brought in celebrity investors and steered Glosslab towards aggressive expansion.

At one point, Glosslab had 40 leases, including 20 operating salons — it’s down to 14 now — and another 20 under construction, sources told The Post.

“Our rent bill for stores we were building was as high if not higher than the stores we had,” a former employee said. By 2022, Glosslab “was already out of the business of running stores and only in the business of opening stores and thats ultimately what went wrong,” the employee added.

As of last year, Glosslab reportedly raised roughly $20 million Glass said in a Fox Business interview and had opened 21 locations across Connecticut, Florida, Maryland, New Jersey, New York, Texas and Washington, DC.

Despite the chaos and the dire cash shortage, Glass last year hired a consultant at about $8,000 per month to run her social media accounts, according to the employee.

“We convinced her that there would be a mutiny since she had just laid off corporate staff, but then shed decide that our next big thing needs to be retail products but we had neither the budget nor the staff or resources to invest in it. It wasnt a plan, it was a whim,” the employee added.

Some salons were shut down by local health inspectors. In Washington DC, the Dupont Circle and Market Circle salons were temporarily closed in November and have since closed for good, according to a report.

If health inspectors ever showed up at New York salons, workers were instructed to “give them the runaround and say you don’t know anything and you just work here,” according to a laid-off worker.

Another former employee who worked at a Manhattan location in 2022 recalled a tense visit from a city inspector who confronted staff over their lack of license documentation. According to New York law, nail technicians must complete a 250-hour course and pass written and practical exams. Their licenses must beposted on the premises.

“He demanded to see at least pictures of some of the nail tech’s licenses,” the source said. “They were panicking in the basement over it. The inspector ended up staying for hours in our store speaking to the director of operations trying to get to the bottom of the issue.”

Nevertheless, “After that incident, nothing changed,” the source added. “There was no company push or initiative for all nail tech’s to be licensed.”

A Glosslab spokesperson responded: “Like most companies in most industries, managers at Glosslab take the lead when inspections occur so employees can focus on their jobs.”

The rep added that all of the other allegations made by former employees are either untrue or inaccurate.”

Constant cash crunches likewise spurred shortage of basic supplies at salons, including gloves and nail files for technicians, insiders said.

“The company would drop off cheap drug store gloves and not the medical grade gloves we usually received, because these gloves were cheap,” a source said. “The acetone would eat through the gloves and cause holes in them mid service with the client.”

A Glosslab spokesperson said reports of short supplies and lesser-quality gloves were “untrue.”

As Glosslab’s financial woes worsened, the landlord of the Darien Commons shopping center sued in October to evict Glosslab for failing to pay its rent for several months last year.

Glosslab has skipped out on other leases, The Post earlier reported, including its retail space at 401 Third Ave. in Manhattans upscale Murray Hill neighborhood, which displayed a public notice from its landlord alleging that Glosslab owes it $146,542 in back rent.

Continue Reading

Business

Ofwat could be scrapped in water reforms

Published

on

By

Ofwat could be scrapped in water reforms

An independent review of the water industry is to recommend sweeping changes to the way the sector is managed, including the potential replacement of Ofwat with a strengthened body combining economic and environmental regulation.

Former Bank of England governor Sir Jon Cunliffe will publish the findings of the Independent Water Commission on Monday, with stakeholders across the industry expecting significant changes to regulation to be at its heart.

The existing regulator Ofwat has been under fire from all sides in recent years amid rising public anger at levels of pollution and the financial management of water companies.

Read more:
Serious water pollution incidents in England up 60% last year

Why has there been a surge in water pollution?

Campaigners and politicians have accused Ofwat of failing to hold water operators to account, while the companies complain that its focus on keeping bills down has prevented appropriate investment in infrastructure.

In an interim report, published in June, Sir Jon identified the presence of multiple regulators with overlapping responsibilities as a key issue facing the industry.

While Ofwat is the economic regulator, the Environment Agency has responsibility for setting pollution standards, alongside the Drinking Water Inspectorate.

More on Environment

Sir Jon’s final report is expected to include a recommendation that the government consider a new regulator that combines Ofwat’s economic regulatory powers with the water-facing responsibilities currently managed by the EA.

In his interim report, Sir Jon said options for reform ranged from “rationalising” existing regulation to “fundamental, structural options for integrating regulatory remits and functions”.

He is understood to have discussed the implications of fundamental reform with senior figures in industry and government in the last week as he finalised his report.

Environment Secretary Steve Reed is expected to launch a consultation on the proposals following publication of the commission report.

The commission is also expected to recommend a “major shift” in the model of economic regulation, which currently relies on econometric modelling, to a supervisory approach that takes more account of individual company circumstances.

Read more from Sky News:
Police taking no further action over Kneecap’s Glastonbury show
New fee for Britons travelling to EU will cost more than expected

How water can teach Labour a much-needed lesson


Liz Bates

Liz Bates

Political correspondent

@wizbates

On Monday, the government’s long-awaited review into the UK’s water industry will finally report.

The expectation is that it will recommend sweeping changes – including the abolition of the regulator, Ofwat.

But frustrated customers of the water companies could rightly complain that the process of taking on this failing sector and its regulator has been slow and ineffective.

They may be forgiven for going further and suggesting that how Labour has dealt with water is symbolic of their inability to make an impact across many areas of public life, leaving many of their voters disappointed.

This is an industry that has been visibly and rapidly declining for decades, with the illegal sewage dumping and rotting pipes in stark contrast with the vast salaries and bonuses paid out to their executives.

It doesn’t take a review to see what’s gone wrong. Most informed members of the public could explain what has happened in a matter of minutes.

And yet, despite 14 years in opposition with plenty of time to put together a radical plan, a review is exactly what the government decided on before taking on Ofwat.

Month after month, they were asked if they believed the water industry regulator was fit for purpose despite the obvious disintegration on their watch. Every time the answer was ‘yes’.

As in so many areas of government, Labour, instead of acting, needed someone else to make the decision for them, meaning that it has taken over a year to come to the simple conclusion that the regulator is in fact, not fit for purpose.

As they enter their second year in office, maybe this can provide a lesson they desperately need to learn if they want to turn around their fortunes.

That bold decisions do not require months of review, endless consultations, or outside experts to endlessly analyse the problem.

They just need to get on with it. Voters will thank them.

Sir Jon has said the water industry requires long-term strategic planning and stability in order to make it attractive to “low-risk, low-return investors”.

The water industry has long complained that the current model, in which companies are benchmarked against a notional model operator, and penalised for failing to hit financial and environmental standards, risks a “doom loop”.

Thames Water, currently battling to complete an equity process to avoid falling into special administration, has said the imposition of huge fines for failing to meet pollution standards is one of the reasons it is in financial distress.

Publication of the Independent Commission report comes after the Environment Agency published figures showing that serious pollution incidents increased by 60% in 2024, and as Thames Water imposes a hosepipe ban on 15m customers.

Ofwat, Water UK and the Department for the Environment all declined to comment.

Continue Reading

Politics

Bitcoin becomes 5th global asset ahead of “Crypto Week,” flips Amazon: Finance Redefined

Published

on

By

Bitcoin becomes 5th global asset ahead of “Crypto Week,” flips Amazon: Finance Redefined

Bitcoin becomes 5th global asset ahead of “Crypto Week,” flips Amazon: Finance Redefined

Bitcoin adoption has been soaring, leading up to the optimistic regulatory expectations related to “Crypto Week” in Washington.

Continue Reading

Technology

The investor behind Opendoor’s 190% run nearly shut down his fund

Published

on

By

The investor behind Opendoor's 190% run nearly shut down his fund

Courtesy: Opendoor

On June 6, online real estate service Opendoor was so desperate to get its beaten-down stock price back over $1 and stay listed on the Nasdaq that management proposed a reverse split, potentially lifting the price of each share by as much as 50 times.

The stock inched its way up over the next five weeks.

Then Eric Jackson started cheerleading.

Jackson, a hedge fund manager who was bullish on Opendoor years earlier when the company appeared to be thriving and was worth roughly $20 billion, wrote on X on Monday that his firm, EMJ Capital, was back in the stock.

“@EMJCapital has taken a position in $OPEN — and we believe it could be a 100-bagger over the next few years,” Jackson wrote. He added later in the thread that the stock could get to $82.

It’s a long, long way from that mark.

Opendoor shares soared 189% this week, by far their best weekly performance since the company’s public market debut in late 2020. The stock closed on Friday at $2.25. The stock’s highest-volume trading days on record were Wednesday, Thursday and Friday of this week.

Jackson said in an interview on Thursday that the bulk of his firm’s Opendoor purchases came when the stock was in the 70s and 80s, meaning cents, and he’s bought options as well for his portfolio.

Nothing has fundamentally improved for the company since Jackson’s purchases. Opendoor remains a cash-burning, low-margin business with meager near-term growth prospects.

What has changed dramatically is Jackson’s online influence and the size of his following. The more he posts, the higher the stock goes.

“There’s a real hunger for buying the next big thing,” Jackson told CNBC, adding that investors like to find the “downtrodden.”

It’s something Jackson’s firm, based in Toronto, has in common with Opendoor.

Watch CNBC's full interview with Social Capital's Chamath Palihapitiya

When Opendoor went public through a special purpose acquisition company in 2020, it was riding a SPAC wave and broader gains driven by low interest rates and Covid-era market euphoria. Investors pumped money into the riskiest assets, lifting money-losing tech upstarts to astronomical valuations.

Opendoor’s business involved using technology to buy and sell homes, pocketing the gains. Zillow tried and failed to compete.

Opendoor shares peaked at over $39 in Feb. 2021 for a market cap just above $22.5 billion. But by the end of that year, the shares were trading below $15, before collapsing 92% in 2022 to end the year at $1.16.

Rising interest rates hammered the whole tech sector, hitting Opendoor particularly hard as increased borrowing costs reduced demand for homes.

Jackson, similarly, had a miserable 2022, coinciding with the worst year for the Nasdaq since 2008. Jackson said his key client withdrew its money at the end of the year, and “I’ve been small ever since.”

‘Epic comeback’

While his assets under management remain minimal, Jackson’s reputation for getting in early to a rebound story was burnished by the performance of Carvana.

The automotive e-commerce platform lost 98% of its value in 2022 as investors weighed the likelihood of bankruptcy. In the middle of that year, with Carvana still far from bottoming out, Jackson expressed his bullishness. He told CNBC that April that he liked the stock, and then promoted its recovery on a podcast in June. He also said he liked Opendoor at the time.

Investors willing to stomach further losses in 2022 were rewarded with a 1,000% gain in 2023, and a lot more upside from there. The stock closed on Friday at $347.52, up from a low of $3.72 in Dec. 2022, and almost triple its price at the time of Jackson’s appearance on CNBC in April of that year.

After Carvana’s 2022 slide, “then obviously began an epic comeback,” Jackson said. Opendoor, meanwhile, “continued to roll down the mountain,” he said.

Jackson said that the fallout of 2022 led him to pursue a different method of stockpicking. He started hiring a small team of developers, which is now four people, to build out artificial intelligence models. The firm has experimented with several models —some have worked and some haven’t — but he said the focus now is using what he’s learned from Carvana to find “100x” opportunities.

In addition to Opendoor, Jackson has been promoting IREN, a provider of power for bitcoin mining and AI workloads, and Cipher Mining, which is in a similar space. He’s seen his following on Elon Musk‘s social media site X, which he said was stuck for years between 32,000 and 34,000, swell to almost 50,000. And after a lengthy lull, investors are reaching out to him to try and put money into his fund, he said.

Jackson has a lot riding on Opendoor, a company that saw revenue and number of homes sold slip in the first quarter from a year earlier, and racked up almost $370 million in losses over the past four quarters.

In early June, Opendoor announced plans for a reverse split — ranging from 1 for 10 to 1 for 50 — to “give us optionality in preserving our listing on Nasdaq.” With the stock now well over $1, such a move appears less necessary, as shareholders prepare to vote on the proposal on July 28.

“I think it’s a terrible idea,” said Jackson. “Those things usually further cement a company’s move into oblivion rather than hail some big revival.”

Opendoor didn’t respond to a request for comment.

Banking on growth

Analysts are projecting a more than 5% drop in revenue this year, followed by 20% growth in 2026 and 12% expansion in 2017, according to LSEG. Losses are expected to narrow over that stretch.

Jackson said his analysis factors in projections of $11.5 billion in revenue for 2029, which would be well over double the company’s expected sales for this year. He looked at the multiples of companies like Zillow and Carvana, which he said trade for 4 to 7 times forward revenue. Opendoor’s forward price-to-sales ratio is currently well below 1.

With Zillow and Redfin having exited the instant-buying home market, Opendoor faces little competition in allowing homeowners to sell their property online for cash, rather than going through an extended bidding, sales and closing process.

Jackson is banking on revenue growth and increased market share to lead to a profitable business that will push investors to value the company with a multiple somewhere between Zillow and Carvana. At $82, Opendoor would be worth about $60 billion, which is roughly 5 times projected 2029 revenue.

Jackson said his model assumes that “like Carvana, Opendoor can prove that it can permanently turn the tide and get to sustained profitability” so that the “market multiple would get reassessed.”

In the meantime, he’ll keep posting on X.

On Friday, Jackson wrote a thread consisting of 11 posts, recounting the challenge of having “99.5% of my AUM” disappear overnight after his primary investor pulled out in 2022.

“Translation: he fired me for losing him too much money,” Jackson wrote. He said he almost shut down the fund, and was even encouraged to do so by his wife and accountant.

Now, Jackson is using his recent momentum on social media to try and attract investor money, while still reminding prospects that he could lose it.

“All I have is my reputation,” he wrote, “and, unless I keep picking good stocks, it will be gone.”

WATCH: Don’t yet know if IPO market is back to full health

Don't yet know if IPO market is back to full health, says Raymond James' Sunaina Sinha Haldea

Continue Reading

Trending