Fortune Mag Talks Beauty in the "The Coronavirus Economy": How COVID-19 Has Affected Business, How Stylists can Rebound, & How We've All Been Handling the Fraught Past Few Months

 

ShearShare Feature by Fortune editor RACHEL KING

After months of lockdown, one of the top priorities for many people as restrictions are lifted might have been deemed inessential before but is increasingly becoming more essential for others.

That would be getting a haircut.

And while reopening salons and barbershops should be easier than opening restaurants and bars in terms of accommodating social distancing and PPE requirements, many hairstylists have lost their jobs and income in the interim period and will be looking for new clients and places to work.

Fortune spoke with Tye and Courtney Caldwell, cofounders of ShearShare—a mobile app connecting stylists with salons enabling them to lease chairs nearby for the day, week, or occasion—for a new series, The Coronavirus Economy, about how the outbreak has affected their business, how hairstylists can rebound after the shutdown, and how they have been handling the fraught past few months, both emotionally and financially.

Tye (left) and Courtney Caldwell, cofounders of ShearShare, a mobile app connecting stylists with salons, enabling them to lease chairs nearby for the day, week, or occasion.
Courtesy of ShearShare

The following interview has been lightly edited and condensed for clarity.

FortuneWhat inspired the launch of ShearShare? 

Tye: Like all great businesses, ShearShare was first created because we were trying to solve our own problem. Today, we’re fueling industry recovery across 625 cities, but it didn’t start out that way. I’ve been a licensed barber and stylist for nearly three decades, earned my doctorate in professional barbering and cosmetology, have owned an award-winning salon and barbershop for more than 26 years, and wrote a bestselling book about how to maintain long-term success in our industry called Mentored by Failure. I recognized the change back in 2012 and saw a shift unlike anything I had seen before. Almost overnight, our industry started to become more and more independent, with stylists almost demanding economic mobility and wanting to manage and grow their small businesses on their own terms. With the advent of social media and technology, today 70% of licensed professionals are independent contractors; we are the second largest industry for freelancers and are expected to grow faster than the average for all other occupations over the next eight years. 

But back in 2012, I didn’t know I’d be helping to grow local economies and get people back to work. I just took a phone call from a stylist who wanted to rent one of my empty suites by the day. She was moving across town and leaving the majority of her clientele behind and couldn’t afford to lose them. If I would allow her to do daily booth rental, she could still keep food on the table. I was unsure and quite reluctant but kept an open mind. After that first experience renting out my space unconventionally, she asked if I could help her get into a few more locations around town, really leaning in on the fact that my knowledge of both sides of the market (from being both a licensed professional and a salon owner) could help her when contacting other owners.

Fast-forward three years, and my wife and I were manually matching stylists to empty salon space as the word spread. One day we were spending more time fielding calls from stylists than working our regular jobs and decided to search for an app that did what we were doing, so that we could recommend that company the next time our phones rang. When we couldn’t find anything online, that became our proverbial “aha moment.” It was that same day that we decided to pioneer ShearShare, the first salon and barbershop space rental app.

When local and state governments started to shutdown nonessential businesses in March, there wasn’t much wiggle room for hair salons, stylists, barbers, and other beauty businesses. As a company that works with these companies and professionals directly, how has this affected your own business? 

Courtney: It affected us greatly, but our industry has been here before. We’ve lived through Ebola, the 2008 recession, Y2K, and other economic downturns. What will always stand true for the beauty and barbering community—whether we live in a new coronavirus economy or not—is that we are an evergreen industry that bounces back. As a matter of fact, the last time the U.S. economy experienced a recession, salons and spas actually added 75,000 jobs during the same period. We knew things would eventually come back online but just didn’t know how long states would mandate closures. Because we’ve lived through hard times before and have come out stronger on the other side, we’re now sharing that encouragement with our community so that stylists can get back to work with confidence.

ShearShare was founded in 2015. How does a shutdown of this nature affect the future of the business, from product development to raising capital?

Tye: You feel it for sure, but we continued pushing along and pressing forward. We didn’t lay off or furlough any employees; instead, we focused on the product and doubled down on providing education for the small businesses we serve—business education that actually moved the needle, like helping more than 100 stylists and ShearShare hosts get approved for [Paycheck Protection Program] funds after they had been denied. Product-wise, we decided to take advantage of the time we had by re-prioritizing our road map and continuing to build out and enhance the platform. Because our team did the hard work during what we call “the COVID quarter,” we released more than 10 new features that help salons and barbershops transition aspects of their businesses online. So if states issue stay-at-home orders again or local economies have to hit pause later this fall, our ShearSharers will have options that make them money on our app. 

Courtney: We knew investors were being careful about deploying capital, resources, attention, etc., because the truth is that some portfolio companies may not exist post-COVID-19. That’s a cold hard fact. However, we made it a point to triage the business early on with our investment partners and be prescriptive in our asks, which gave us the opportunity to keep those lines of communication open for when things returned to some sense of normalcy and we could continue conversations. 

Now that select cities and states are starting to reopen, how is ShearShare adjusting to whatever the new normal might be? Are there enough precautions and guidelines in place that consumers can feel safe about meeting with stylists again?

Tye: Most people don’t realize that more than half of our training is actually devoted to sanitation precautions. As a licensed cosmetologist and barber myself, it’s important to share that each state’s respective licensing and regulations body mandates that these safety measures be learned in order to pass your cosmetology or barber license exam. We, as professionals, understand the safety precautions needed to protect the client—steps like mandatory wearing of gloves before and after each new client; washing hands between appointments; changing client capes after each service; thoroughly sanitizing chairs and tools between clients; providing hand sanitizer in visible locations, etc. ShearShare provided not just information by state but also drafted client health statement templates, reopen strategies, Barbicide sanitation certifications—anything to add to the extra layer of education for the customer to see—because all of this gives the consumer a better level of comfort and ease when coming back to the salon and barbershop. Because our team is from the industry, we realize that we are the community, so we feel extremely indebted.

During the coronavirus lockdown, we provided a slew of content that met the very real needs of our fellow professionals: topics like how to apply for EIDL [Economic Injury Disaster Loan] funds; how to come up with revenue-generating ideas while at home during ’rona; how to reopen with care and prep for a new normal; why a banking relationship is important to have after you get back to business; how to rethink pricing in a post-COVID-19 world; new safety and sanitary precautions, etc. Of course, we knew the pandemic would have a major effect on the beauty industry in the short term, but I don’t think we foresaw how much of a change that would be. We just released a report that highlights the current state of our industry after COVID-19, and given the current climate, stylists are choosing to work much more differently than they had before the pandemic—the how, when, and where marking the biggest transitions.  

Courtney: For our tech business specifically, the new normal involves a surprising uptick in states where ShearShare wasn’t as active before March, so that’s been a very positive signal, especially because we’re doing our part to help local economies recover. Stylists are using ShearShare to increase their economic mobility, they’re booking locations closer to home, and they’re choosing workspaces that fit their unique needs. And despite the pandemic, we have more listings now than before.

Over the past month, there has been a much stronger and more concerted effort on social media to encourage consumers to support black-owned businesses. At the same time, there is the worry that while this might offer a much-needed sales bump during an economic downturn, nonblack consumers will not commit to this effort in the long term. What can other members of the business community do to amplify and sustain support for black-owned businesses?

Tye: Get to know the black businesses in your neighborhood and the black business owners. This creates legitimate cohesiveness within the community at large and encourages a stronger local ecosystem. Black-owned businesses have always been pillars in their respective communities, whether they are in a black neighborhood or a diverse community. As a black business-owner myself, I know that we over-index in nearly every spending category; and it’s my opinion that if a business is providing a great product or service, that business will be supported regardless, because people vote with their dollars.

Especially during this time, however, it would behoove us to actively amplify and give our energies to show support in any way possible, because supporting black-owned businesses is supporting businesses. And we can do that through word of mouth, online recommendations, sending donations, through social media conversations like the ones happening at the @pullupforchange page on Instagram, or anything that drives business forward. Small businesses are and forever will be the backbone of the U.S. economy.