Thirty-seven-year-old Patrick Kidd was an electrician for eight years but was not satisfied. Originally from the far South Coast of NSW, he moved to the UK for two years where he met his future wife who was studying to become a lawyer.
The two decided to risk it all and re-mortgage his apartment to start a business together in Australia. Traveling overseas, Patrick had noticed a growing trend cool men’s hair salons and knew there were none in Sydney. So the couple opened Sydney’s first luxury men’s hair salon in 2007.
With lots of hard work, they built it up into a really successful business and even won Australian Hair Salon of the Year. The salon was booked out most weeks and had a database of 22,000 clients.
“We were providing such a high quality service but we couldn’t find any luxury men’s product lines to stock, so we set about making our own to fill the growing demand from our clientele,” Patrick said. “The mass market is flooded with men’s hair products but there is nothing at the top end.”
Stumbling upon a golden opportunity
Upon researching some more, they realised they were sitting on a treasure chest – there was a really exciting opportunity to build a big business – across-the-borders big.
Men’s grooming is the fastest growing retail category in the world and coupled with the massive gap in the market, it’s absolutely booming globally.
It’s possibly the biggest growth industry of the 21st century and is projected to exceed $35 billion by the year 2016.
This is primarily driven by the rapid growth of the middle class, increased internet connectivity and the expansion of prestige across the world.
If you ask me, it’s all these selfie sticks!
Men are increasingly becoming more beauty conscious but are not settling for female products and are demanding products that specifically address their needs and also look good in their bathroom.
A gap in the market that no one was seeing
With no luxury men’s product lines in existence, Patrick was inspired to develop his own to fill the growing demand from his clientele.
The salon was an amazing R&D testing ground and with the help of their clients, the couple was able to develop a consumer driven brand – Patricks.
They initially tried to develop the products with three leading Australian companies but after two years, they realised no one could get the products to the high level they expected so they ended up working with a famous US formulations company with a strong reputation for scientific innovation and had already created some of the world’s leading hair care products.
A self-described perfectionist, Patrick was keen to make sure everything was exactly was how he wanted it right from the raw materials to the packaging.
“I did not want to be confined by what had been created before or by what I was told was possible, I wanted to push boundaries.”
He revealed to Anthill that it, for example, took an incredible four year cross collaborative effort between him, designers, custom tooling specialists, business managers, engineers and factories to bring his packaging ideas into reality.
“I think I drove everyone crazy with how perfect I needed to get everything, even the sound of the lid clicking closed! The primary focus was practicality but it was also designed to display a subtle sophistication.”
After seven years of testing and tweaking the products, they knew they had a great line on their hands and so decided to sell the salon to concentrate on their global launch.
Patricks has now secured distribution with the most premium department stores and men’s fashion websites around the world. Distributers include Mr Porter, Neiman Marcus, Joyce Beauty, Lane Crawford and Sephora all secured within months of launching.
Now available in Australia, Hong Kong and US it will soon launch in UK and Korea.
Move over corporate advisors, here comes DIY capital raising
Patricks is now about to open a $2 million Round C of capital raising to fund world-wide marketing campaigns, secure additional distribution and help in its mission to establish itself as the world-wide leader in luxury men’s haircare.
Like many start-ups, Patricks needed capital but rather than paying corporate advisers thousands of dollars and a hefty percentage of the capital raised, Patrick paid $25,000 and completed an Advanced Diploma of Corporate Finance through MBE in Sydney and raised the money himself by presenting his idea to potential investors.
And he has been nailing it! Round A which raised an initial $250,000 from friends and customers at the salon in 2013 was filled in 3 weeks and Round B which raised $500,000 from the network we had established through the salon in 2014 oversubscribed in 5 days.
On what advice he has about raising capital, Patrick says, “People don’t realise they have access to many potential investors already in their personal and professional network that they can tap into. This includes wealthy friends, family members and referrals from people who believe in your business.”
“It’s also a great idea to create a strong advisory board. Don’t be scared to give away a small percentage to strategic advisors who will then have a vested interest in the success of the business,” he added.
“This also helps with raising capital as potential investors like to see there are people involved with the business who can fill knowledge gaps.”