Franchise Times – Gina Rivera is the maven behind the mohawk of Phenix Salon Suites

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Let’s start with the haircut. It’s the only possible beginning when writing about Gina Rivera, the founder and president of Phenix Salon Suites. Hers is a stunning, platinum blonde mohawk that her father creates for her whenever they can find the time. “It takes five hours to do my hair. It’s an all-day event. We bring in food,” Rivera says with a laugh.

How many hairstyles has she had in her lifetime? She laughs really loud. “You go on writing,” she says, while she thinks about that. “It might be about 15 minutes” before she can answer. “I’ve been red, dark, highlighted, long, shaved,” she says, counting up more than 20 different styles. As for the shampoo, conditioner and hair spray in her new product line launched last summer, called By Gina, she’s her own best test case. “I’m a great testament for products because I use them ALL. I need them all and I use a LOT in my hair.”

Her father, Larry Peneschi, was a platform artist at the major hairstyle shows with a shelf full of trophies to prove it. “He ran with the best of them. He was right up there, if not better than, the top of the top,” she says, but there are more. “There are 27 hairdressers in my family going back to 1929, my uncle’s grandmother. We have a black and white photo of her and in the background is a chicken coop.”

Rivera got her own start in the family business at age 8, when she threatened to cut her own hair if her mother, also a hairdresser, made her go to school. School it was, so Gina chopped off her bangs. By 16 she had dropped out of high school in Colorado Springs and moved to Arizona, one of the places you could apprentice without a license, she recalls. By 22 she had finished high school and beauty school at the same time, and was excited about her new career until her supervisor called her in for a meeting.

“I thought I have this in the bag,” thinking she was due a promotion. “I’m going to be a top artist.” Her manager sat her down and dropped the bomb: “I really don’t think you’ll make it in this industry.” Rivera “got deflated.” She was “so upset.” And then she got mad: “Who are you to tell me I’m not going to make it in an industry I love.”

Today, 250 franchise units at Phenix Salon Suites, the attraction of a new minority investor last year called 10 Point Capital, the new line of hair products, a reality TV show, her husband, Jason Rivera, as her business partner and company CEO and two children including her franchise’s namesake, her son Phenix—and she’d like to tell that manager one thing. “Never let anyone tell you you can’t.”

Founder Gina and CEO Jason Rivera named their franchise after their first-born son, Phenix.

It’s about them’

Tom Wells is a managing partner at 10 Point Capital, a young private equity firm in Atlanta that was spun off from Buckhead Investment Partners, helmed by Scott Pressly.

Pressly was with Roark Capital, the dominant private equity firm in the franchise space by a mile, before starting BIP and now 10 Point. Wells is the executive charged with making the firm’s investments—including Tropical Smoothie, Tin Drum and most recently Phenix Salon Suites—work.

“It’s a concept that’s built by a stylist for a stylist. I think that resonates,” says Wells, and he views his job as supporting the founders and helping them grow without losing their special sauce. “How do you think about going from 200 units to 1,000 units? How do you stay true to the culture? How do we go to market to get franchisees? How do we get units open faster?” Those are his four burning questions, and the analytics are starting to confirm 10 Point’s approach.

Phenix signed 40 agreements in 2016. That jumped to 60 for 2018 and he expects about 100 in 2019. To the founders, he advises identifying just a handful of priorities.

“What are the three things you are focusing on, and what are you not going to do?” is his mantra. “Bringing that fanatical focus on what really matters.”

What really matters to Gina Rivera is the hairdresser, and that started with what she considers an insult. She was in a typical salon renting a booth, and she went into labor early with her first child, Phenix. “I went to the hospital, and it wasn’t 15 minutes and I got a call.” Rent was due every Saturday, said the caller, and if she wanted to keep her booth someone needed to bring over a check pronto. “I said you know what? I’m done,” and she opened her own salon and then began to think bigger—creating a space with a number of booths that stylists could make their own and run in their own way. “I wanted to bring the salon professional at the center,” she says. “It’s about them. When you see them in their suite and they have their own business I want them to know they’re a part of it.

Today Phenix Salon Suites franchise owners spend about $300,000 to $980,000 to get a location open with an efficient process that includes recently added construction support at corporate headquarters, one of the items Wells at 10 Point believed was needed.

The goal there is to reduce the time from signing an agreement to getting open, and Wells will be checking the analytics he’s imposed at the brand. Nothing happens quickly when investing in a new system, Wells says. “They take time. When you see those that have signed 200 and five are open,” that’s what he aims to avoid. For all three systems 10 Point is in, Wells says they’re in for the long haul. “I look at this as 50 years from now these will be great businesses.”

Getting to this point took trial and error, says Rivera. “I made $150,000 in mistakes. I had the bright idea to put in white carpet. It looked great for about 30 hours,” she says with a laugh, then continues, “I did a 110-foot linear waterfall. It was beautiful. It worked one day and then we worked on it every day for three years. We loved it but it didn’t love us back.”

She feels “blessed” that 10 Point Capital signed on as an investor, something she and Jason resisted for years. “You just get to a point in life where you do want to grow. I have always been very open and diligent about surrounding myself with good people,” she says, but allows it can be difficult for a founder. “You have to swallow your pride a little bit and be humble.”

Scenes from last year’s CosmoProf, the beauty and hair products show where Gina Rivera launched her new line, By Gina.

It’s clear she’s proud of the history. In 2007 she wanted to do her first suite concept, and by 2009 had it launched and grew it to four stores that she owned. In 2012 she brought on Jason as CEO. He had a marketing firm and had worked with brands like Smashburger. Bringing in an investor was “just that next step.”

Before signing with 10 Point, she met with many other firms. “I am very protective and very passionate about my brand. My son’s name is on it. I’m a stylist myself,” she says. “I wanted someone to live it like we live it. It was the first group that I felt got what I was doing.”

Phenix Salon Suites has stiff competition, notably Sola Salon Studios, which last year brought on a new equity partner to buy out the founders and is more than twice as big. My Salon Suites, another competitor, has strong financial backing from a large strategic partner, the Ratner Cos.

Rivera’s many ventures beyond the franchise concept, too, risk a loss of focus as she pours energy into creating beauty products and styling tools. Notably, the line of styling products called By Gina features Rivera’s stunning silhouette with her signature mohawk, but none of the products makes any mention of Phenix Salon Suites so they won’t necessarily benefit from her celebrity.

Rivera is aware of the danger but vows she’ll do right by her franchisees.

“So many brands get so big, brands start to lose that personal connection. It’s a goal to keep the face, someone who’s walked in their shoes,” Rivera says. For her the haircut, or to be precise the person who creates it, will always be the first and last word of her franchise.

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Standing out in the beauty biz

You can see what a newcomer in the beauty products selling business is up against at Cosmoprof North America, the annual convention where I went to see Phenix Salon Suites founder Gina River in action last year. She was a first-time exhibitor, launching her line of By Gina hair products, and there was plenty of competition.

There were 38,000 attendees in the Mandalay Bay Convention Center last July, ricocheting from one colorful come-on to another. Should we visit the man in the sparkling hat and pink jacket, handing out packets of Queen V lubricant and insisting that “wetter is better.”

•  Or the sisters from Canada with a lipstick line called Ton, with an online quiz to take to see which one is right for you.

•  Or the new product purveyors lining up to talk with social media influencers who would then post online reviews instantly.

•  Or the tall man who put eye toner under my left eye and told me to come back later for the other eye, to see which looked better.

•  Or the garish yet photogenic Hello Kitty booth that nonetheless forbade photos.

•  Or the man who shouted “welcome to Brazil” to everyone who walked by, presumably all 38,000 of them.

•  Or the choose-your-own beauty box you could fill with all kinds of samples for a $10 donation (and surprisingly even get them all through TSA at the airport.)

After a half hour of wandering and several phone calls to Rivera’s assistant, I spotted her booth, No. 43,000, with Rivera herself providing the focal point.

There was the white couch with blacked fringed pillows and pink and white peonies, a translucent pink chaise lounge flanked by Rivera’s arresting gray-screen image with her mohawk silhouette.

A Phenix Salon Suites stylist was fixing a walk-in client’s hair in a chair, using Rivera’s styling utensils designed to never get tangled up with other cords. Meanwhile, Rivera’s assistant mentions she would be on HSN on the Beauty Spot in the fall. A former star on “Undercover Boss,” she also did an NBA All-Stars charity event, styling hair for 47 models.

After a 20-minute interview with Rivera and her husband, Jason, she’s back to work and I’m wandering the convention center. Should I say hello to the drag queen, or visit the wig booth with hot pink, purple and lime wigs, or …