The Patient Road to Partnership: How an Australian “Midwesterner” is Building a Thriving Beauty Empire Rooted In America’s Heartland with the help of Private Equity
We don’t remember the exact words we said on our first call with Gino Barbo, CEO of Salon Service Group (SSG), but we can tell you that the conversation was brief. “I never ever thought about private equity,” Gino explains, recalling the event. “I was always going to be one of those entrepreneurs who never sells. I had vowed that for many years and truly believed it each time I said it.”
A Midwesterner from Down Under
In many ways, Gino is a textbook Midwestern entrepreneur: hardworking, humble, and family-oriented. But as soon as you hear Gino speak, you’ll realize he’s a Midwesterner by choice, not by birth. A native of Australia, he first visited the U.S. to cheer on his country in the 1984 Summer Olympics. However, the sports were soon overshadowed by a different kind of match after meeting his future wife Dana. She visited him in Australia that Christmas, and then he returned to the States the following year for her college graduation and never left.
Finding a job in the U.S. proved more difficult than finding a partner. Gino had left school at the age of 16 to work as an electrician and play professional cricket. And while he also gained experience working in sales for an Aussie company similar to Frito Lay, prospective employers wanted to see a college degree on his resume before they would so much as grant him an interview. Finally, after paying an employment agency $800, Gino was offered a position with a salon distribution business in Ozark, Missouri, in 1987. “It was really small,” Gino says, remembering his company’s modest beginnings. “I think our first year we did $87,000 in business.”
A mere three months into this hard-earned job, Gino was told he was about to be out of work again as the business was closing. Instead of packing up and moving on, Gino dug in his heels, borrowed $12,000 from his father-in-law, and bought what is now SSG. At first, the fledgling company’s marketplace territory was limited to mid-sized Missouri towns like Joplin, Springfield, Branson, and Columbia and smaller towns in between. But as the years passed, SSG started picking up more markets. “We kept growing based on opportunities,” he explains. “In my sporting career and in life, in general, I’ve always wanted to compete and do well and continue to grow. So when opportunities came up, I took advantage of them instead of sitting back and getting comfortable.” As a result, SSG now covers 19 states and is the single largest independent salon distributor in the country.
A New Lease on Life
Thankfully, that first call nearly five years ago wasn’t our last. We stayed in touch with Gino and were able to build a relationship that eventually led to a partnership. “Over a period of about three years, I came to see that GRC would be a good partner because it isn’t a typical PE firm,” Gino notes. “They were very clear about their role–that they aren’t operators. They would be on the backend offering support when needed and I would still get to run the company and keep the culture intact.”
Eighteen months into the partnership, Gino says there haven’t been any surprises. “With three years of ‘courtship,’ I had a good grasp of what I was getting into, and it’s been exactly that,” he explains. “GRC has let me run the business and has been there when I’ve needed advice or when I’ve wanted to pursue opportunities for growth.” Gino still spends his days in the office, although his focus has shifted to how he can build relationships with other distributors he’s known for 35 years and find a way to get them involved with SSG. “I really love working on mergers and acquisitions,” he says. “I could have gotten very bored, but this partnership has given me a new lease on life that I really enjoy.” SSG has already added Princess Professional, a high-end salon distributor in Texas and Oklahoma, to its ranks and is close to announcing its second partnership.
In addition to no surprises, Gino says there haven’t been any regrets either. “I have two adult children who work in the business, so it wasn’t an easy decision,” he continues. “I could have given them the opportunity to be a part of SSG as it was and kept it at that. But with GRC, they can be a part of making SSG a national brand. I could never have given them that.”
Mr. Barbo is not a current or former investor in a Great Range fund. He has not been compensated for this statement.