I had the pleasure of meeting Elaina Watley at the 2020 Black Enterprise Women of Power Summit She participated in a breakout session entitled “Conversations About Wealth Creation,” which focused on encouraging black women to set goals and to be empowered when managing personal finances. It’s not often that someone’s personal journey has an effect on me as Elaina’s did, so after the session, I was excited to have the opportunity to sit down with her and learn more.
If you’re not familiar with Elaina’s story, she is a single mother, co-parenting her daughter with her former partner, Victor Cruz, retired wide receiver for the New York Giants. Over 10+ years, the relationship had great highs and lows, and eventually came to an end. For many women, the story stops there, but for Elaina, it was simply the start of a new chapter. She founded Brand Infinite, a marketing agency that managed the careers of professional athletes, including Victor. Prior to that, she worked for top agencies including Creative Artist Agency and William Morris Endeavor, but she felt it was time to do something she could fall in love with, which led her to the Amazing Lash Studio franchise.
Meet Elaina Wately
Black Enterprise: Elaina, thank you so much for taking the time to share your story. In the Women of Power session, you revealed that you loved lashes, which is what drew you to that business. How did you decide to go with a franchise rather than creating your own brand?
Watley: I have several friends that own various franchises, some single-store owners, others Area Representatives (AR), and I just loved the idea of being able to scale the business quickly.
Black Enterprise: How did you land on Amazing Lash Studios?
Watley: I researched ALL of them! Not only did I want to find the right one for me, but I had to prove to my financial adviser that this was a viable business that could achieve strong revenues. When I started meeting with the Amazing Lash Studio team, I felt a real connection—they were incredible. I also really loved their marketing, they were on all the calls I asked them to be on, and they were very open with their financials. But what sealed it was how receptive they were to listening to everything I had to say.
When I asked Elaina to expand on that a little bit, she shared that at the time she was considering investing, Amazing Lash Studio was an emerging brand, with approximately 65 units open at the time. Everyone, including her, wanted to grow—big. When this emerging brand was willing to listen to her ideas on growth
strategies, she knew she had found the right business. Today, the Amazing Lash Studio franchise has 270 units nationwide.
Growing and Scaling
You are currently operating five locations but own a total of seven. How did you start and how are you growing?
Watley: I started with purchasing a license for one location in NJ but quickly regretted not buying multiple licenses at the start. My advice to people getting into a brick-and-mortar franchise business is to really think about your future plans. I knew I wanted to grow, and had I purchased additional licenses in the beginning, I would have been able to secure the surrounding territories to ensure I could grow where I wanted to. When I went to look for my second location, the territory had already been purchased. Luckily, through a series of events, I was able to get the territory and location I wanted, but it was a challenge. My third, fourth, and fifth locations were actually acquisitions from other owners. Unfortunately for them, they were struggling with the model and were looking to sell. While they were having great sales, their profitability margins were too low to sustain the business. Having done well with my first two locations, I knew how to get the profitability numbers where they needed to be.
I’m really excited about my next two locations because I’m moving into New York. One will be in Brooklyn — the first location in the five boroughs and the other potentially in Manhattan.
Those are VERY expensive markets, what made you confident that you could handle the lease and build-out costs?
Watley: I know! This goes back to my love for the Amazing Lash Studio brand and team. I approached my franchisor and told them I had found the perfect location in Brooklyn, but the lease and build-out costs were sky-high. So, I pitched to them a new interior design concept that would cut the build-out costs significantly, and they were all in. Now, we have created a more open floor plan and we’re calling it the “urban design.” It’s beautiful!
Sharing the Wealth
One of the things that really impressed me during the session was that you’ve made some of your employee’s owners in the business. How did this “share the wealth” idea start and how did you implement it?
Watley: When I opened my first location, I was still working full time. When it came time to hire managers and team members, I was looking for leaders that I would be comfortable with running the business while I was working. During my interviews, I asked applicants what their five-year plans were. Those that responded that they were interested in owning a store themselves, I paid special attention to. I was blessed to hire three women that saw the vision, and now, I wouldn’t want to do the business without them.
My original plan was to simply be a business mentor and encourage them to own their own locations. But once I realized I didn’t want to do the business without them, I looked for a way that we could build together, so I wouldn’t lose them. That’s when I began to think about offering equity. I spoke with my financial adviser to learn the various ways to share equity. Then I started offering monthly financial literacy courses to my team so that they could learn how financing worked and how to save money that could go toward store ownership. Not all of the equity offers are the same. It often depends on what the person wants to do and what they’re willing to sacrifice. I make the offer and ask them what they are willing and able to put in. It’s usually a combination of sweat equity and monetary investment—everyone puts in some money, based on what they have. As owners, they may get a salary, or an ownership model based on a percentage of the profitability.
Let’s get to what I call a four-letter word when it comes to investing in a business — LOAN. Oftentimes, our community is afraid to take out loans under the guise of not wanting to owe anyone (especially the government) and what happens if you can’t pay it back. Did you have a fear of loans and what advice do you have for people afraid to take out loans?
Watley: I always wanted to take out loans because I was told that preserving cash was important, and to leverage other people’s cash whenever possible. However, my student loan debt from college did scare me. But I still knew that I needed to remain as liquid as possible. The more I learned about SBA loans, the more comfortable I got. SBA has better flexibility than conventional loans, so in case of economic disaster and hardships, they are quick to allow deferments. Just this week, due to the coronavirus outbreak, they have deferred loan payments 90 days.
My advice would be, if you’re planning to purchase a franchise, ask about the franchisor’s preferred lender— most of them have one. They tend to work with the same bank to get a lot of their deals done. The benefit here is that the lender understands that particular business, with a number of approvals under their belt, and that will help you get your approval. After you get your first SBA [loan], the subsequent ones become A LOT easier. I knew much more about the process and I was also able to use my strong Profit and Loss statements as proof of concept in the business case.
You were a Finance major in college, yet, you are very open about being scared to look at your business numbers. How did you get past that, and what would you suggest to others who find themselves in this situation?
Watley: I first had to ask myself WHY am I afraid to look at my numbers. Why am I afraid to face them? I determined it was because I didn’t want to be disappointed. Once I got past my fear and looked at them, I still didn’t really understand what the numbers were telling me. I then enlisted the help of several people, including my franchisor and financial adviser. My franchisor helped me understand key benchmarks. My adviser and personal accounting team gave me various scenarios. If I wanted my profits to be in a certain place, these are the things I needed to do differently. That’s when I learned all about leveraging various business credit cards for points, perks, and cash back.
I didn’t want to look at my numbers, because I was afraid of failing. But I had to learn not to be afraid of failing. I realized that NOT looking at the numbers was failing.
A Woman of Power
I know your plan is to continue to grow with Amazing Lash Studios and to help other women become owners, but what other projects are you working on?
Watley: I am so excited about what I’m working on. I visited Ghana earlier this year with a group of girlfriends. I absolutely fell in love with the landscape and the people. I had a spiritual transformation on that trip. After returning to the States, I started a business called “The Butterfly Effect.” Our goal is to introduce the diaspora to Ghana. We plan to host curated trips to help develop the Ghanaian ecosystems, starting later this year. We hope to provide entrepreneurs with the same cultural connection and experience we had.
In addition, we’re building a school in Ghana called “Lilies of the Field.” We consider it to be a disruptor in the community. The current school already has after-school programs in place, so our plan is to expand upon that by building a state-of-the-art facility that provides classes for the entire day.
Our third component will be to create an investment fund, so that we’re able to connect the global community to Ghana, by providing more education on building viable and sustainable businesses.
To learn more about “The Butterfly Effect”, please go here.