MD Esthetics

New Harbor has maintained an active focus on Healthy Living and Wellness as an investment thesis since 2022, and the medical aesthetics and wellness sector is an extension of this focus. The national medical spa (“medspa”) market is a robust and rapidly expanding sector, currently estimated at approximately $5.6 billion and projected to grow at a 15 percent CAGR as of 2024. ⁽¹⁾  This significant growth is fueled by several factors, including an increasing adoption of services by young adults and men, alongside an expansion of service offerings, particularly within the wellness category.

The shift in patient demographics to more young adults and men is in part driven by a heightened focus on self-care and longevity. ⁽²⁾ This interest is driving the development of innovative wellness products and services. Medspas are at the forefront of this evolution, serving as the key customer touchpoint to deliver these emerging services. The medspa market also benefits from a highly loyal client base, with 73 percent of first-time customers returning for additional services multiple times a year ⁽²⁾, indicating strong client satisfaction and a recurring revenue stream. This loyalty, combined with the expanding demographic reach and the influx of innovative wellness offerings, positions the medspa sector for continued rapid growth.

New Harbor was first introduced to MD Esthetics (“MDE”, “the Company”) in June of 2024. We found MDE to be unique from other medical aesthetics and wellness providers based on the team’s commitment to clinical quality, a focus on a broad array of both aesthetics and wellness services, and its holistic approach to patient care.

MD Esthetics was founded in 2018 in Windham, New Hampshire by Dr. Michael Pedro and Danielle Pedro. MD Esthetics is a growing medical aesthetics and wellness business with 12 locations across Massachusetts, New Hampshire, and Virginia. The Company provides comprehensive, quality medical aesthetics and wellness services through a holistic and thoughtful approach. Services include an array of wellness offerings, such as hormone therapy, weight loss treatments, and IV therapy. MD Esthetics also offers MD Esthetics Academy, a robust training academy for its providers, which all newly hired injectors are required to complete to ensure consistency with the Company’s clinical standards. MD Esthetics Academy combines in-person training workshops, professional mentorship, and access to an online training portal with over 60 hours of proprietary clinical content.

In addition to M&A, New Harbor’s investment management plan focuses on expanding the Company’s service offerings, optimizing marketing capabilities to drive organic growth, and increasing provider recruitment and retention.

*Implied organic growth is derived by calculating quarter-over-quarter growth from Q4 2024 to Q1 2025 and annualizing the result given the lack of comparable pre-acquisition data.

*Certain statements about New Harbor Capital made by portfolio company executives herein are intended to illustrate New Harbor Capital’s business relationship with such persons, including with respect to New Harbor Capital’s facilities as a business partner, rather than New Harbor Capital’s capabilities or expertise with respect to investment advisory services.  Portfolio company executives were not compensated in connection with their participation, although they generally receive compensation and investment opportunities in connection with their portfolio company roles, and in certain cases are also owners of portfolio company securities and/or investors in New Harbor Capital-sponsored vehicles. Such compensation and investments subject participants to potential conflicts of interest in making the statements herein.

(1) Hyde Park Capital Medspa Market Insights (Fall 2024)
(2) Houlihan Lokey MedSpa Primer, Fall 2023