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The best time to start a business may be in the worst of times.
The recession had engulfed Southwest Florida when Jonathan Sigg started The Laser Lounge Spa in Estero in August 2009. Today, the company is franchising new locations, including its fifth location in Sarasota.
Sigg, a physicians' assistant, had moved with his wife, April, and two children 10 years ago during the boom years to a family condo in the area, easily landing good jobs at local hospitals.
But Jonathan Sigg had always wanted to operate his own skin-care business. Sigg had some savings, but banks weren't lending and investors weren't in any mood to back a new venture.
When Sigg's personal skin-care specialist went out of business in 2009, he sensed an opportunity. The skin-care specialist owned a $25,000 laser hair-removal machine, but it was sitting unused in a closet, so he agreed to rent it to Sigg for $500 for six months.
Sigg found an empty shopping center in a good location on Estero Boulevard that suffered from the lack of tenants. “I don't have anything to give you,” Sigg bluntly told the landlord. So in return for eight months of free rent, Sigg promised to put up a sign and bring traffic to the center: “It'll look like something's happening,” he told the landlord.
Armed with a $20,000 Home Depot credit card, the Siggs did most of the tenant improvements themselves. “We used to refurbish houses,” Jonathan Sigg says. “We worked day and night.”
Sigg didn't give up his emergency room job while he was building the new business. He would work a 12-hour night shift in the emergency room, come home to sleep for a few hours early in the morning and open The Laser Lounge Spa at noon. “I had to finance this somehow,” he says.
When April Sigg couldn't be there to help (by then they had a third child together), Jonathan manned the front desk, took calls, made appointments and did the laser hair removal procedures. “I did the whole thing myself,” he smiles.
Because his overhead was low, Sigg could afford to undercut the competition with low prices. For example, he charged $199 for six sessions of underarm hair removal while he says competitors charged $1,000. “That alone drove a lot of people,” Sigg says.
The word spread quickly. Within a year, Sigg moved the business to a larger space and hired a part-time front desk employee because of the growth in new customers. The Laser Lounge Spa started offering other services such as Botox injections, too.
To fund the growth, Sigg turned to private investors in Naples who provided $100,000 in capital. Still, Sigg was careful not to quit his hospital job. “We wanted to pay off the guys and we didn't want to take out more loans,” he says.
By 2014, Jonathan Sigg felt comfortable enough to leave his hospital job to focus on growing the Laser Lounge Spa. Total revenues in 2015 have grown to $2 million, up from $1.4 million in 2014.
To remain efficient and keep overhead low, Sigg centralized the administrative functions so that appointments come through a central call center and he purchased a handicap van to transport a mobile hair-removal laser that costs $75,000. He transports the laser from one of his four locations to another depending on demand so he doesn't have to purchase an expensive machine for each office that might sit idle at times.
Sigg has big plans. The fourth office in Fort Myers and a new office in Sarasota will soon be the company's first franchisees. A franchise costs $50,000, plus 7% royalties.
The franchise documents were recently completed, but Sigg says demand could be strong for his concept from plastic surgeons and skin surgeons who might consider it as an ancillary business. “This year we could open a half dozen,” Sigg says.
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