By Kevin McKenzie The Commercial Appeal, Memphis, Tenn.
WWR Article Summary (tl;dr) "Project Belle LLC" hopes to do for beauty what Uber has done for transportation and Airbnb has done for home rentals.
The Commercial Appeal, Memphis, Tenn.
A Nashville-based technology company known as Belle is connecting customers with hair stylists and other beauty and health professionals who will provide services in customers' homes.
Like "sharing economy" giants such as Uber and Lyft in the transportation business and Airbnb in home rentals, Project Belle LLC has run afoul of government regulators who aren't buying the company's new model of doing business.
The state Board of Cosmetology and Barber Examiners maintains that Belle doesn't have a cosmetology shop license, is operating outside of the law and should shut down its web-based service.
Belle, with plans to expand to other cities including Memphis, is pushing back.
The company contends that as a tech company connecting entrepreneurs to customers, it isn't bound by the board's regulations.
Belle's founder and chief executive officer, Armand Lauzon, said the company provides more flexibility and more money for those in an industry where women and low earnings are common.
The competition for traditional brick-and-mortar beauty shops and salons is a good thing, Lauzon said.
"You can see what happens when there's competition: More value is created for clients, more value is created for professionals and more people can follow their dreams," he said.
In Memphis, Venus Austin disagrees. Owner of Epiphany Salon and Gallery, Austin said she pays $2,700 a month for her shop Downtown on Front Street.
"I think it's cutthroat with all those of us who are paying all this money and legitimately licensed," she said.
The cosmetology and barber board is set to consider the consent order, an informal settlement agreement, at an Oct. 3 meeting in Nashville, said Department of Commerce and Insurance spokesman Kevin Walters.
Lauzon, 30, said that he was in his hometown of Boston, working in a private equity firm and overseeing a venture fund and portfolio of start-up companies when his cousin sparked the idea for Belle.
As a manicurist, "once she became a mom, a traditional brick-and-mortar nail salon wasn't really a possibility for her," he said.
He said he'd been fascinated that Uber could start a virtual taxi company without investing in taxis, and that Airbnb makes virtual hotels without investing in any property.
"Talking with my cousin and her profession in the beauty industry, I realized that there really should be a virtual salon and spa for these people so they can have and run their own businesses without investing hundreds of thousands of dollars in brick-and-mortar operations or sacrificing their income to an owner of such an establishment," he said.
A friend in Nashville convinced him to start up there as well as in Boston in September 2015. Nashville growth doubled the pace in Boston, prompting him to move to Tennessee's capital last March and put Boston on ice, he said.
Belle's online marketplace, using credit cards as payment, allows customers to choose their provider for hair, nail, massage, makeup, lashes, chiropractic, fitness, fashion, skin and spray tan services.
Those providing the services, currently totaling about 50, set their own schedules and prices, Lauzon said. They'll travel to the customer, including to homes, offices and hotels. Reviews by both the customer and provider provide a quality check.
"The typical brick-and-mortar may take 50 percent to 85 percent of the revenue that a professional generates because the overhead is quite expensive," he" said. "We take 15 percent."
Belle vets and ensures that all of the cosmetologists are licensed, but maintains that the company itself doesn't fall under the state's 1986 cosmetology law.
A complaint about Belle's "highly disturbing" type of competition from a Nashville shop owner to the cosmetology board earlier this year triggered a "consent order" for Belle. The board calls for the company to cease and desist its alleged violations and to pay a $500 penalty.
Instead, Nashville attorney Daniel Horwitz, representing Belle, challenged the disciplinary action on several grounds. "As in any industry, however, despite creating a winning recipe for workers, consumers and the public at large, Project Belle's disruptive business model does produce losers" -- its competitors, Horwitz argues.
Still, Belle took steps to have its customers certify when purchasing that they meet exemptions allowed in the state's regulations for providing services outside of a shop.
Those range from in-home services for people who are ill to work in funeral homes. Massages by themselves are exempt. As a back-up to comply, customers agree to "photographic sessions" fulfilled if cosmetologists snap a photo of their work.
Lauzon said that elderly people, accident victims or people with disabilities represent a large segment of Belle's clientele. Business is growing by about 40 percent a month, he said.
He said the firm has contacted state lawmakers for support in its battle with the board and perhaps in reforming the law. State Sen. Steven Dickerson (R-Nashville) is one of them.
The Tennessee legislature stepped in "because in Nashville the taxi industry was trying to choke off Uber and Lyft," Dickerson said.
In a letter, he's encouraged the cosmetology board to be open-minded and not drag its feet in the difficult area of technology-driven change, he said.
As an anesthesiologist, he's watching similar change as telemedicine allows doctors to outsource services around the globe and multiply their reach.
"I'm an advocate for the technological innovation," Dickerson said.
Lauzon said Belle plans to expand first in Tennessee, perhaps considering Memphis in 10 to 12 months,
At Epiphany Salon and Gallery, Austin said she will serve clients who are homebound or in the hospital, "but just to go to a stranger's house, I don't know," she said.
"Personally, I don't agree with that," she said. "I think there's too many boundaries that can be crossed and I think there's too much stuff that can happen that would really compromise the integrity of our industry and our professionalism and what we do."
A 34-year-old hair stylist who said she started at age 15, April Kirkham, said the industry already is using web-based services such as StyleSeat and Genbook to schedule clients and rate performance.
Now styling only part-time as a single mother attending nursing school, Kirkham said she wouldn't sign on with Belle, "but I know a lot of people that probably would."
"It's all about convenience now and we have adjusted to the society we're in, so as much as they fight against it, I'm sure one day it's going to be possible," Kirkham said. "We're more open now to this innovation and new possibilities."