Success for Untraditional Startup after Difficulty Finding Lending Support
Alyce Jeppesen and Shawn Tolman had been good friends for years. Jeppesen owned a photography studio, and Tolman had owned multiple businesses, earned his MBA, and was working in the financial services industry. Their friendship grew into a business partnership when Jeppesen found herself in a very personally stressful point in her life.
“Alyce was literally praying for an answer to relieve stress and income for her family,” said Tolman. Her own stress was taking a toll, which led her to realize the health implications it could cause.”
Her research showed a majority of people suffer substantial daily stress that doesn’t get relief. She found studies showing stress alone is a major contributing factor either directly or indirectly, to coronary artery disease, cancer, respiratory disorders, accidental injuries, cirrhosis of the liver and suicide, and aggravates a realm of other conditions. An estimated 75 to 90 percent of visits to health care providers are due to stress-related conditions.
“She called me one night with a business idea,” said Tolman. Jeppesen’s idea, while going through her own stress, realized people needed stress relief and a relaxation outlet. Thinking about how to do that, she was struck with a business concept to provide the exact opportunity for others who needed it as well.
Jeppesen’s concept was to provide a sensory oasis to help people escape from the stress and worries of the outside world. Her research found these treatments increase oxygenation, metabolic rate, detoxification, blood circulation, and lymphatic activation, as well as providing a host of other beneficial results in the treatment of many medical conditions.
Not only would the concept include clients stepping into a completely stress-free environment, but also include the idea of making it safe, secure, affordable and accessible twenty-four hours a day, seven days a week on a membership basis. The concept envisioned a facility using state-of-the-art private stations, scientifically-proven equipment to provide relief from stress, pain, tension, soreness and depression.
“The business idea was an answer to Alyce’s prayers,” said Tolman.
Jeppesen put her business ideas and research to paper and Tolman refined it into a business plan. They found that no other business existed with this concept. After considerable market research, they began looking for financial support to put their dream into action and open a business that would apply this new concept. They were met with lenders who would not support their startup.
“In 25 years, I had never seen financial projections in a business plan that were this good,” said Tolman. “So we started talking to banks, and they would ask, ‘What is it that you are going to do?’ They had no point of reference to draw from.” So they turned to the Wyoming Women’s Business Center.
They secured a first SBA micro-loan through the Wyoming Women’s Business Center for $50,000, and in 2014, they opened their pilot business, Ahhhsome Relaxation, in Evanston, WY. The location was affordable and met their requirements. The loan processed in March of 2014, and by August of 2014, the membership had grown so substantially that it was necessary for them to take out a second loan through the WWBC for $30,000 for additional equipment.
“WWBC enabled us to open a pilot location to prove our business concept was viable,” said Tolman. “As it was a new concept, the traditional lenders were unwilling to give us a loan.”
The loans from the WWBC were primarily used to purchase equipment in the Evanston pilot location. By May 2015, the concept had been so well-proven they began to sell franchises. Monthly payments were made on the WWBC loan from cash flow, and Ahhhsome Relaxation was able obtain financing from a new larger bank loan in order to expedite paying off the WWBC loans. They were then able to move forward with a full-size, 8,500 square-foot Idaho location, which will open in November 2015. This location will serve as the corporate headquarters, with an additional 6 franchises in development for 2016. Franchises are being considered in Boise ID, Salt Lake City UT, Logan UT, Ogden UT, Las Vegas NV, and Vancouver WA.
“Without WWBC taking a risk on a new idea,” said Tolman, “we would still be looking for financing.”
The loans resulted in one full time position and two part time positions in Evanston, WY. The new Idaho location will result in the creation of 10 employees, with expectations to double the number of employees in 2016 as franchises open.
Not only has Ahhhsome Relaxation seen business success, but their clients have seen additional health benefits from the stress reduction it offers.
“We have great testimonials from clients who say the stress reduction has completely changed their life,” said Tolman. “Because of Wyoming Women’s Business Center, we are moving forward with our dreams and changing lives.”