Nearly one month after Heather Pacheco bested 12 other contestants in a competition aimed at getting a new business into one of Gilroy’s 24 vacant downtown properties, the Garlic Capital is on track to boast the “best new trend in affordable luxury” – but the process hasn’t been smooth sailing for the winner in her quest to find exactly the right building for her new “blow-dry bar.”
“It’s been a long road,” said Pacheco, 32. “Hopefully this one is a go.”
The ball got rolling officially June 8, when the upstairs of the Old City Hall Restaurant in Gilroy was packed to the gunnels with 130 people watching intently as 13 contestants duked it out onstage, pitching their plans to a panel of judges for a new downtown business.
The stakes were high: the victor would walk away with a $50,000 prize – provided by the Gilroy Downtown Business Association – to help transform the winning vision into reality. Ultimately, it was Pacheco’s “Shag Beauty Bar” that took the honors and the money. Her plan for a blow-dry bar was simple: no colors, no cuts – just a shampoo, blow-out and a little styling for anyone looking to treat their tresses.
“It’s going great,” said GDBA President James Suner, who masterminded the competition. “We’re moving forward.”
Picking from a pool of 24 vacant downtown properties was slightly more complicated than Pacheco first anticipated, however.
Her initial choice of suite 101 in the colonial-style La Aldea building – a three-story, 17,000-square foot, multi-use property built in 2009 by local developer Gary Walton – was scuttled by legal entanglements over ownership of the building, which is in receivership and owned by Santa Barbara Bank & Trust.
Another possible location at 42 Martin St. next to OD’s Kitchen went right down to the wire, literally.
“It is such an old building that it was going to take my entire $50,000 budget to fix the electrics,” Pacheco laughed.
While she was presented with the obligatory oversized winner’s check on the night of her victory, Pacheco doesn’t have carte blanche to do what she wants with it.
“She’s not going to Vegas with the Shark Tank money,” grinned Suner.
The money is held in an account with Pinnacle Bank with Suner and Pacheco listed as cosigners. The funds can only be used for expenses Pacheco incurs for a lease, operating capital or improvements, Suner explained.
There was also the caveat of getting the business up and running within a 100-day time frame, as specified in the competition’s rules. But Suner is willing to have a little flexibility on that.
“It’s the real world. If we get to the 90th day and (Pacheco) needs 20 more, then that’s OK,” he said. “We need to get this business open.”
Now, the plan appears to be for Pacheco to move into the Bertolone Building at 7433 Monterey St., right next door to Aviva Wine Café, which ties nicely into Pacheco’s plans for a wine bar theme at her blow dry salon.
“We’ll cross-promote business and get the synergy back in Gilroy,” Pacheco previously explained, referring to Shag Beauty Bar’s plan to offer a “pairings” section on their website featuring menus from coffee shops and restaurants for customers to order in while they’re at the salon.
“We’ve talked about it a couple of times. It’s a great idea,” said Yolanda Castaneda, part-owner of Fifth Street Coffee with husband Daniel Pina.
A relatively new face in Gilroy’s downtown business world, Fifth Street Coffee opened in March 2013. Castaneda is enamored with Pacheco’s plan for cross-promotion.
“Of course I love it,” Castaneda laughed. “It will support our business.”
Shag would also promote local events and their chosen winery of the month through the “all dressed up and nowhere to go” link on their website. Featured hairstyles will be named after wines – “The Merlot” for instance is “full-bodied and smooth” – and Pacheco intends to showcase many of South County’s 22 local wineries to customers by serving a “wine of the month.”
Owner Mark Bertolone is expected to tell Pacheco “yes” or “no” later this week.
“It’s perfect,” Pacheco said. “At least he’s willing to work with me.”
Pacheco – whose mother, Rhonda Rodgers, owns a full-service hair salon on Fifth Street called Shag Salon, where Pacheco has worked for nine years as a stylist – underscores the valuable input and assistance she has received from Suner throughout the process so far.
“This is my first venture on my own and I don’t think I realized how much work goes into a start-up,” she noted.
And if all goes according to Suner’s plan, Shag Beauty Bar won’t be the only product of Shark Tank Gilroy moving into the Bertolone building.
Richard Legends and his business pitch for “Raw Legends Co.”, an urban streetwear company specializing in cutting edge fashion, are still on Suner’s radar, along with first runner-up Tawnya Lancaster and her “Wild Pizza Kitchen” idea.
Legends is thankful for all the attention coming his way.
“Honestly, it’s a great opportunity for me,” he remarked. “We’re taking it slowly and trying to figure out the best step for me.”
“I’m doing a release next week for a small summer collection,” added the budding fashion mogul.
Likewise, Lancaster is pleased with the progress being made in bringing her farm-to-table artisan pizza cafe to life. Her situation is slightly different, however, since she has to organize an investor pool.
“In four to six weeks we’ll have a better idea of what’s going to happen,” Lancaster explained.
“Once we get the money it’ll be full steam ahead,” she added.
Legends didn’t place in the top three on the night of the event, but he did place third when it came to the competition’s popular vote. Shark Tank attendees were asked to text GDBA coordinator Melanie Corona who they thought should have been in the top three, and 147 people duly texted their choices.
The result? Pacheco still came out on top, with Lancaster second. Dark horse Legends wowed the crowd enough to knock Elena Castaneda, who pitched “Haute Couture,” an upscale designer resale shop, off her third place perch.
“I think I’m going to personally invest in Legends,” Suner noted.
The prospect of having multiple new tenants makes it easier to get new businesses into downtown, he continued. Property owners are much more likely to pay for the required build outs if they know all the available space will be used.
“It makes a building viable,” Suner added, referring to the economics in recouping build out expenses through rent from tenants.
Blow-dry bars are enjoying a renaissance, explained Pacheco, as women take a retro approach to their beauty regimen. The process –once highly popular and common in the ’50s and ’60s – features a hair wash with salon-quality shampoo and conditioner, blow-drying and styling. LAist.com describes blow-dry bars as “blow-on-the-go salons” that are “currently the best trend in affordable luxury with new ones popping up in Los Angeles daily.”
Pacheco says prices will range from $40 – for a scalp massage, shampoo and blow out – to $85 and above for a special occasion hairstyle such as a French Twist.
At the time of her win, Pacheco experienced the downside of being victorious. A storm of negative comments identifying holes in her business plan appeared online. There was even gossip about the integrity of the judges and the event itself.
Pacheco has taken it all in stride.
“Whoever won, there was going to be negativity. The people commenting didn’t get to see our financials,” she said. “It’s going to be successful and I’m going to prove them wrong.”
