Last week I opened our booking software and watched a $15 eyebrow wax turn into $4.50 for the stylist who actually did the work. Nobody at my salon touched a setting. Vagaro did it automatically, with a new "AI feature" none of us asked for.

Vagaro, the scheduling and payment platform many salons run on, including mine, rolled out an AI tool that supposedly fills your calendar with new appointments. In exchange, they take a cut: 5% on existing customers, 20% on new ones.

They call it a “Deposit”. Look closer and it's really a commission on customers you already had before this feature existed. Any online offer you'd set up months ago, one your regulars already claim every week, now triggers that commission the moment it's booked. It doesn't matter if the customer ever opened the chatbot. It doesn't matter if they found you on Google or got referred by a friend. If the appointment came through online booking, Vagaro gets paid.

Then there's the discount nobody asked for. Vagaro automatically knocks 10% off for existing customers and 20% off for new ones, on top of taking its cut.

Do the math on a $15 wax booked by a new customer. Vagaro's 20% commission takes $3 off the top. Its automatic new-customer discount takes another $3. What's left to split with my stylist is $9. She earns $4.50, before tips, for a service she still has to walk over, prep for, and perform start to finish. This is heartbreaking on larger services…imagine this same math on a $300 multi-stage color service performed over hours.

Vagaro calls that commission a "deposit." That's not just clever branding, it functions as one. If the customer no-shows and the service never happens, Vagaro still gets paid. They can fill your calendar with low-quality, no-show-prone bookings and walk away with the money either way.

This stacks on top of fees we already pay:

And every piece of this new commission structure was turned on automatically. To opt out, we'd have to give up online checkout and online promotions, the exact tools our customers use to book with us. Alright, I’m done ranting…now we get to the real point I want to make.

I sat with that dashboard for a long time. Not because I was surprised a software company chases margin. Because of who actually pays for it.

Not Vagaro. My stylists. The ones already working commission-only, already absorbing every discount I offer to bring in new faces.

We're at a moment where AI could genuinely make small business ownership cheaper and easier. Vagaro had that exact opportunity and used it to squeeze harder instead. Calling a hidden commission a "deposit" so it survives a no-show isn't innovation. It's extraction with better branding.

I've spent 15 years in tech. I know how to build software. So instead of just being angry about this, I'm doing something with it.

I'm building a booking and payment system for independently owned salons, one that doesn't quietly tax the person doing the work. It's an expansion of Dime, the AI tool already answering calls after hours at our salon. I'm calling the whole thing Dime by Hundred Dollar Empire.

I'm holding it to a standard I'd actually want at my own salon:

Here's the honest part. Building this right takes real time, not a weekend project. So I'm slowing Hundred Dollar Empire down for about six months while I build, test, and get this into real salons, starting with mine.

I'm not disappearing. You'll still hear from me, just less often, and a lot of what you hear will be the build itself, in progress, instead of a polished announcement after the fact.

If you've ever opened a dashboard and found a fee you never agreed to, hit reply and tell me about it. I'm collecting those stories. They're exactly what I'm building against.

Stay subscribed. Dime by Hundred Dollar Empire is coming, and I'd rather build it in front of you than behind closed doors.

Michael

I’m building out a suite of products and services to help people like you consider buying or starting then scaling a local small business. If you’re interested in learning more, let me know.