Blackstone’s recent investment in South Korean premium hair care brand Juno takes a familiar thesis into a new geography.

The manager has enjoyed success in the US building out franchises under food and beverage plays such as Jersey Mike’s, Tropical Smoothie Cafe, 7 Brew, and even residential and commercial property damage restoration services provider Sevpro. Now it is looking to replicate the rapid-expansion model in Korea.

“We love these businesses because with the right management and the right operating resources, they’re highly scalable – not just in one country, but even more broadly as we’ve demonstrated across our other portfolio companies,” said Eugene Cook, head of Korea private equity at Blackstone.

“When we thought about Juno as a potential investment target, this was really the intersection of two important themes for us at Blackstone – beauty, personal care, and the whole advent of K-beauty, and the scalability of franchise business models.”

Hair care is a particularly attractive segment, despite a decline in discretionary consumer spending in Korea. Cook believes it stands out from other personal care segments as a resilient, almost non-discretionary, play: haircuts are not something the average consumer is likely to give up or put off.

Quality counts 

Established in 1982, Juno is at the premium end of the market, providing services ranging from haircuts and specialised scalp treatments to nail care and spa treatments. It has over 180 branches nationwide, a growing footprint in Singapore, Vietnam, and the Philippines, and new master franchise partners in Japan and Thailand.

Ensuring quality service is a key tenet of the business. Every Juno store is staffed and led by people who have been trained in-house. Anyone wanting to become a June franchisee must have a minimum of 10 years within the Juno ecosystem. Stores outside of Korea are led by staff who have spent time working for the company in Korea.

Excluding existing franchise owners, there are more than 450 employees in Korea alone who have a decade or more of experience at Juno. The key, Cook explained, will be to strike a delicate balance so that these quality standards are not sacrificed for the sake of accelerating top-line growth. The involvement of Juno’s founder, Yun-Seon Kang, who will remain as CEO under Blackstone’s ownership, is seen as providing helpful continuity.

“This is a classic example of Blackstone partnering with an iconic entrepreneur, supporting her vision and working closely with various family members who are going to stay involved in the business. It’s what I like to consider our bread-and-butter approach to investing,” said Cook.

There are about 150,000 hair salons in Korea, most of them mom-and-pop shops. Franchise brands account for less than 10% of the market, whereas in other developed economies – such as the US, France, Japan, and Hong Kong – this share is typically 20%-30%. However, over the last five years, franchise brands in Korea have been growing at almost twice the rate of the overall market.

“In general, there’s a momentum behind these franchise brands, and over time they will represent a larger portion of the market,” said Cook.

Juno’s average annual store rollouts have been in the low teens over the past decade. Blackstone plans to accelerate this, believing the company can capture market share on the basis of its professionalised and modern stores and its existing consumer following, and by improving technology and education and training programmes.

Keen on Korea

The Juno investment – the size has not been disclosed – comes from Blackstone Capital Partners Asia II, which closed on USD 6.4bn in early 2022 and mobilized an additional USD 4.6bn from the firm’s global funds.

The fund is now approximately 90% committed, according to Cook. There is capacity to do at most two more deals.

The fund’s successor, Blackstone Capital Partners Asia III, has raised USD 8bn against a target of USD 10bn. This will form part of a larger pool expected to be around USD 11bn in size.

Juno marks Blackstone’s fourth private equity investment in South Korea. The first, in 2015, was luxury handbag manufacturer Simone Accessories, according to AVCJ Research. It was followed by the buyouts of pharmaceutical wholesaler Geo-Young in 2019 and industrial cutting tools manufacturer JJ Tools in 2024. Geo-Young was exited last year to MBK Partners in 2024.

“We’re not just sitting around waiting for assets to come to market,” said Cook. “We’re proactively out there, building relationships with owners, founders, and families so that when the time comes for a succession change – or in the case of Juno, when management felt that there was a need to bring on a global partner – we are one of the first calls of choice.”

[Editor’s note: The 13th paragraph has been amended post-publication to clarify that Blackstone Capital Partners Asia II closed on USD 6.4bn in early 2022 and mobilized an additional USD 4.6bn from the firm’s global funds.]