Candace Nelson Transcript
Kerry Diamond:
Hi everyone, you are listening to Radio Cherry Bombe, and I'm your host, Kerry Diamond, coming to you from Newsstand Studios at Rockefeller Center in New York City. Each week we feature interviews with the coolest culinary personalities around. Joining me today is Candace Nelson, the co-founder of Sprinkles, the world's first cupcake bakery. Candace isn't here to talk about cupcakes, even though Sprinkles red velvet cupcakes are very high up on my list of favorite things, Candace is here to talk about her brand new book, Sweet Success: A Simple Recipe to Turn your Passion into Profit. I really wish this book had been around before I launched Cherry Bombe. If you're thinking about launching a business, especially in the food or drink space, you need this book. It will save you time, money, and heartbreak. Candace will be with us in just a minute to share some of her hard earned wisdom and sweet advice.
This episode of Radio Cherry Bombe is supported by Käserei Champignon, a 100-year-old cheese producer and the maker of Cambozola. This fine cheese, which I happen to like very much, is made with Bavarian alpine milk and crafted by master cheese makers dedicated to using all natural ingredients and traditional methods to create one of a kind cheeses. Cambozola, a triple cream soft ripened cheese with delicate notes of blue, is truly a cheese like no other. For a more intense experience, try Cambozola Black Label. Aged longer and colder than Cambozola Classic, this bold and exceptionally creamy cheese was a 2022 best in class winner at the renowned World Championship Cheese Contest.
To celebrate 40 years in the U.S. market, Cambozola is giving away three luxurious beach vacations, up to $10,000 in value. Visit thisisfinecheese.com for more information and to enter. While you're there you can find recipes, pairings, and the stores near you that carry Cambozola. Don't forget, it's not Blue, it's not Brie, it's Cambozola. Regarding the sweepstakes, there is no purchase necessary to enter, it ends December 31st, 2022, and is open to legal residents of the 50 United States and Washington DC who are at least 21 years of age at time of entry. Subject to official rules, available at Cambozolasweeps.com. Void where prohibited.
A little housekeeping, the Cherry Bombe Cookbook has turned five years old, can you believe it? This beloved book features recipes from 100 amazing chefs, pastry chefs, bakers, makers, and shakers. You'll find recipes for the world's best banana bread, that is the world's best according to me, by Chef Camille Becerra. My favorite chocolate chip cookie recipe is in there, it's by Avery Ruzicka of Manresa Bakery. And there's also the book's most popular recipe, the Pink Spaghetti from Elettra Wiedemann of Mama Farm. You grate the beets, make a sauce, and your spaghetti is magically stained bright pink all the way through. The Cherry Bombe Cookbook is beautifully designed and, in my humble opinion, has one of the most iconic cookbook covers of all time. Pick up a copy at your favorite local bookstore or snag one for a holiday gift.
Now, let's check in with today's guest. Candace Nelson, welcome to Radio Cherry Bombe.
Candace Nelson:
Thank you for having me.
Kerry Diamond:
We should have had you on the podcast, you should have been one of our first guests, but you know what? Things happen for a reason, and you have this incredible book out now called Sweet Success that I just finished, and I wish to God that I had had this book when I started my entrepreneurial journey.
Candace Nelson:
That means so much to me, I can't tell you, I just got chills. Obviously any book is a labor of love, but this one in particular, it was very mission driven for me, and to hear that it's reaching and speaking and resonating with someone is everything. Thank you for that.
Kerry Diamond:
You would have saved me a lot of heartache and financial distress.
Candace Nelson:
That is the goal, that is the goal right there.
Kerry Diamond:
Had I had this book, Candace, why did you decide to write Sweet Success?
Candace Nelson:
A couple of reasons. One, I think that entrepreneurs are glamorized in the media a lot these days, but I'm not sure I necessarily agree with what we're seeing. We hear a lot about the Elon Musks of the world, and the Jeff Bezos of the world, and entrepreneurship for me is not just about, sorry, but narcissists sending people into space. I built a great business out of something really simple, out of a simple cupcake, something that anyone can make. I'm not a tech savant, I'm not an engineer, I wasn't VC [venture capital] funded. I wanted to share that vision of entrepreneurship with people, because entrepreneurship in general I just believe in so much. I think it's the future, I think it represents the future, I think it can be really life changing in terms of generational wealth, I think it can be incredibly fulfilling just in terms of creating something in the world that you dreamt up, and watching it become a reality, there's really nothing more fulfilling than that.
And then on top of that, people were coming to me organically, after having scaled and sold a significant stake in Sprinkles, with their questions, and I started mentoring a few women, and the request kept coming and I couldn't fulfill them all. So this book is really a chance for me to serve a larger audience of people who maybe have a business idea on the back burner, or they've started one and they need a push along the way, so that was the reason.
Kerry Diamond:
Well, a lot of people are going to benefit from the fact that you poured all your knowledge into this book, and it's a fun read. If business books intimidate people, this one should not. I didn't go to business school, so I had to rely on books and podcasts.
Candace Nelson:
I didn't go to business school either, I thought about it, but I ended up going to pastry school instead. And I say Sprinkles was my cupcake MBA [master of business administration], because really all the learnings are in the doing, I really believe that. I get a lot of questions from people, do I need to do this first? Do I need to go to this school? Do I need to have this certificate? The world has changed. There's so many resources at our fingertips online, there's so many networks now that are available for people who want to go out and do it themselves, I don't think you should feel like you have to get X, Y, and Z to get started.
Kerry Diamond:
I want to ask you about the subtitle, it's A Simple Recipe to Turn your Passion into Profit. I was curious that you used the word simple, because I feel like your Sprinkles journey was anything but simple.
Candace Nelson:
Yes, well it's that old expression KISS, keep it simple stupid, right? Well, the idea behind Sprinkles always was very simple, yes, building a business can be very heady, and anything but, but the idea of creating a product, elevating a simple pleasure, and turning a food that people think they know into something surprising and new, the concept, the idea, was simple. It took off, it exploded beyond my wildest dreams, for sure, and I was drinking from a fire hose from day one. But the book itself, I think, and I hope, breaks down this idea of building a business from ideation to sale in a very simple way. It follows a four step recipe, it's: dream it, package it, build it, and protect it. Anytime we get in this head space where everything seems so complicated, it's not. Business, at the end of the day, is generally pretty simple. You just have to distill it down into solving a problem, and solving a problem that's so great that people will pay money for it. I'm definitely drawn to simplicity, I love simple pleasures, cupcakes and pizza, and I like distilling things down into ideas that are very simple to grasp, because I'm just, at the end of the day, I'm a bit of a simpleton myself.
Kerry Diamond:
For those folks who don't know the Sprinkles story, can you tell us what Sprinkles is?
Candace Nelson:
Oh, sure. So Sprinkles was the world's first cupcakes only bakery. My husband and I opened it in 2005 in a little 600 square foot space in Beverly Hills, and it was significant for a couple of reasons. One was cupcakes were, at the time, still pretty basic. They were either what you found in the supermarket bakery in plastic clam shells, or they were just this old fashioned kitschy grandma's kitchen style of cupcake. I looked at cupcakes after pastry school and I thought, huh, it's a bit sad, here is this beloved treat, that is just uniquely and innately American. We all have these incredible nostalgic feelings of growing up with cupcakes, celebrating them at birthday parties, and yet look at them, they really need an upgrade. And so after pastry school I set about to reinvent the cupcake from the inside out, starting with the ingredients, the technique, and then of course the aesthetic, making cupcakes elegant, sophisticated, chic, aspirational and giftable, and came up with the idea for Sprinkles.
Well, people thought it would never work, because for one they said, cupcakes only bakeries don't exist because bakeries need to sell all the things to survive. Two, you're opening in Beverly Hills, nobody eats carbs there. And three, it was the height of the low carb craze. The South Beach Diet had been on the New York Times bestseller list forever. There was no funding available to us, my husband and I pooled our meager life savings at the time and bet it all on cupcakes. And this was after a time in banking for both of us, and technology. And so we both came from these corporate paths, and everyone we knew was scratching their heads as to what we were doing. I mean, nobody could understand it.
So the cards were really all stacked against us, but from day one, we were really met with this insatiable demand, and I think so much of it was the fact that we were really doing something different and innovative, something that really made people stand up and take notice. It was the right time, we had the right mindset and hustle, and we got those cupcakes in front of the right people and had incredible word of mouth, including from some very bold face names. But also when I was planning my wedding, Martha Stewart Weddings was making cupcake towers a trendy alternative to wedding cakes, and I remember seeing that at the time and thinking, oh, that's so clever, because there's so much to love about a cupcake, they're portable, and my mind went back to being in the corporate world and someone celebrating a birthday and ordering a cake in, and there were never any forks or knives, and then you'd get one cake and somebody didn't like the flavor. There are all these downsides to getting a cake.
Kerry Diamond:
What is your relationship to Sprinkles today?
Candace Nelson:
So in 2012 we sold, my husband and I sold a majority stake in Sprinkles to a private equity firm. It is still like my first child, I care for it deeply, but I'm not operationally involved anymore.
Kerry Diamond:
Okay. What does that mean for folks who hope to maybe have an exit one day?
Candace Nelson:
So it means if you see something new at Sprinkles, I wasn't the person who made that decision. My husband and I sit on the board, are involved from a very high level, but I am not doing anything on a day-to-day basis for Sprinkles the company.
Kerry Diamond:
Got it. So you worked in investment banking after college, and Candace, it was so funny, when I was typing out the questions I typed investment baking. I was like, some people could call it investment baking, right?
Candace Nelson:
That sums it up right there.
Kerry Diamond:
I'm curious, how did baked goods become a passion? Because it wasn't your thing.
Candace Nelson:
So growing up I spent a lot of my childhood overseas. I lived in Southeast Asia, my dad was a corporate lawyer, he worked for a couple different multinationals, and very risk averse household, not an entrepreneurial household at all. But these were, of course, pre-internet days, so I was on the other side of the earth as a little girl, and I missed my friends, and I missed my TV, and I missed my sticker collection, and all those 80s things at the time, and the only way that I felt a connection to home was through food, but I couldn't, if I had a craving for a rice crispy treat or a cupcake, I couldn't go to the corner store in Indonesia and get one, so I spent hours and hours and hours in the kitchen with my mom baking all the treats that I missed from home.
So baking was always really foundational to my connection with my mom, my connection with my country, my homeland, and always represented the sense of comfort, but also belonging. Then going to college and working investment banking, I didn't have a lot of time to devote to baking, but certainly did it to comfort myself whenever I had time on the weekends. And then also being in San Francisco during that time, the dot-com boom, it was a really frothy time, and expense accounts were, people were just throwing money at fabulous dinners. And so in my early 20s I was going to places like French Laundry and Boulevard and being exposed to all these incredible restaurants and great food, and really reignited my passion for great food.
Kerry Diamond:
But then the dot-com bust kicked you in the butt.
Candace Nelson:
The dot-com bust kicked me in the butt because I had been following this really traditional path, I was raised in this risk averse household, but one that really believed in education, so I went to the best college I could, and then I was really trying to prove myself in that corporate world so I got the best job I could, which was this prestigious investment bank, and then I jumped ship, as so many people did during the time, to go make my internet millions, which of course didn't happen, but I was trying, and I thought if I followed this path I would just inevitably find success and happiness.
And then sure enough, dot-com bust happened and I was like, wait a second, this wasn't supposed to happen. And then not long after that 9/11 happened, and that was when I really, for the first time ever, reflected on what it was I wanted. We spend so many hours working, and I was just like, what am I doing? If this all ends tomorrow, which 9/11 was one of those moments when you start to think like that, and I think it's so clarifying in terms of what it is you're doing with your life. And I realized number crunching was not fueling me, and so instead of going to business school I decided to go to pastry school. Went to cooking school, but the pastry program at Tante Marie's down the street, and I just loved it. I had the best time.
Kerry Diamond:
One thing I like about the book though is you are very honest about the ups and downs, and people see you now and you're hugely successful, entrepreneur, investor, TV personality, but you were unemployed and really not sure what to do with your life. You were on the couch watching Oprah, baking for comfort.
Candace Nelson:
Thank you for bringing that up because I think it's really important to highlight that those low moments are normal, and I think such a part of the process to understanding and uncovering what it is that you've been put on this earth to do. And I had always been in search of that thing, I was this jack of all trades, well-rounded kid, I felt like it was just, I wanted to be one of those people who had always known what they wanted to do, it really bothered me.
After I lost my job, you're right, I was on the couch. I definitely was, someone put it to me the other day, they were like, "So you were in a depression?" And I was like, "I actually never said that, but I think I was," I think I was actually literally in a mild depression. I spent hours on the couch watching TV, and I think about now just how many resources are available to people for inspiration, there wasn't as much at the time. For me, inspiration was watching the Martha Stewart Show, watching the Oprah Winfrey Show, and I would watch them on repeat.
Kerry Diamond:
There was no Instagram, no Pinterest, no LinkedIn.
Candace Nelson:
No podcasts, Martha Stewart and all her baking wormed it's way into my subconscious, and I just started baking and baking more, and playing, and came out of my funk through just being in that flow.
Kerry Diamond:
So you started a custom cake business in San Francisco, and you write in the book, "These cakes were slowly killing me." I'm sure there are some bakers out there listening who can relate to that. How did the cake slowly killing you as you trudged up and down the hills of San Francisco with those poor cakes sloshing around in their boxes morph into this cupcake only bakery in Beverly Hills?
Candace Nelson:
After I had spent years crunching numbers I was determined to really exercise this creative part of my brain. So I wanted to do the most artful, most creative thing I possibly could, and for me that was these wedding-style cakes, these multi-tier, multi-layered cakes, working with buttercream, working with fondant and gum paste, and making flowers and all of these flourishes. And I realized that, first of all, wow, so much respect for the people who do that, it is so much work, and it is days on end to create all the components of the cake, and the filling, and the decorations.
And I also realized that what I loved about baking was this idea of simple, fresh pleasures, and these wedding cakes were not only incredibly laborious, but by the time they were done, they weren't exactly fresh. They're delicious, but they weren't like a baked fresh straight out of the oven treat, which is what I really loved. And then on top of that, I was living in San Francisco at the time, so I'd put these cakes into these boxes, and all of a sudden they'd be at this 45 degree angle, and I could just hear them sliding, decorations popping off the cake, and I was like, I don't have it in me for this, this is too much, the stress is killing me.
Kerry Diamond:
Anyone who has gone up and down the hills of San Francisco can automatically imagine the nightmare of cake delivery.
Candace Nelson:
It was awful. So anyway, it was fun while it lasted, but it just got me thinking, there's got to be a better way. Not only that, but of course I do have a business side to me that just won't quit, and so I thought, this isn't even really a great business because a cake is not something that people buy in this country all the time. A special occasion cake is for special occasions, what could I make that people could buy on a daily basis and enjoy on a daily basis? And so that led me to the cupcake, the miniature version of these cakes, and elevating it, but still keeping the playfulness of a cupcake. I didn't want it to be too serious, I wanted it to be a modern twist on an old fashioned classic.
Kerry Diamond:
So I was surprised to learn that you bootstrapped Sprinkles. I made some assumptions, that I'm sure other people have, that because you were an investment banker, and you worked on IPOs [initial public offering] and mergers and acquisitions, that you had access to this network, but no, you and your husband bootstrapped it, right?
Candace Nelson:
That's right. So we had a little bit of money, we had enough money to live on for a couple years and create this business, obviously we had to buy the space that we ended up leasing, so that was a good chunk of money. But we didn't own a house, we were renting, we didn't have children yet. We were not going out to dinner, we were driving around my very one-legged Saab hatchback with the roof liner sagging down.
Kerry Diamond:
There are some very sad stories about the car in the book, yes.
Candace Nelson:
Very sad, yes, the car is a main character in the book. Everyone who knew us said that they thought we were crazy and it was a terrible idea. I mean, we were essentially two out of work investment bankers looking to bet it all on cupcakes at the height of a low carb craze. So we knew that there was no one in our network who would be funding it, plus the network we had come from was really, these were high tech companies, these were really high growth companies, and a bakery is not known for being one of those, it's not in general known for being a space where you can grow and have successful exits. So we were going from one end of the spectrum to the next.
But it was just an idea that I had such a gut feeling about, in spite of all of the things pointing to it not being a good idea, I couldn't get over it. And Charles [Nelson], to his credit, my husband, he was all in. He was like, "If you can perfect the product, this sounds fun, I've always wanted to be an entrepreneur too, this is the time, let's do it." And so we pooled our resources and made it happen. It was a lot of sacrifice.
Kerry Diamond:
But even his parents thought it was a terrible idea and couldn't believe their son was, instead of pursuing some high paying tech job, or something like that, doing this with his wife.
Candace Nelson:
Oh, well talk about risk averse, his dad was head of a bank in Oklahoma City. I mean, he was like, "No." He sees risk everywhere he goes, so yeah, he definitely saw us as one of those who he would not have given a loan to if we'd walked through his door.
Kerry Diamond:
I can imagine people thought this was a quaint hobby and not a serious business thing.
Candace Nelson:
Yeah, my friends initially, when I started making cupcakes out of my West Hollywood apartment, after San Francisco we moved down to L.A. with this business idea in mind because the economy in San Francisco was still struggling after the dot-com bust. So we came down to L.A., my friends were like, "Oh dear, Candace has lost it, she's baking cupcakes. She was on such a nice path." So they started ordering cupcakes, I think because they felt sorry for me. And of course I was product seeding everywhere around town, every party I went to I brought cupcakes, I brought business cards, which sounds so antiquated now, but I had stacks and stacks of business cards that I handed out. And certainly in the beginning it was just my friends who took pity on me, but at these parties there were other people there and they thought-
Kerry Diamond:
At the pity parties?
Candace Nelson:
At the pity parties. I got customers from those pity parties, and then before I knew it there were people placing orders who I had no idea how they'd found me, and one of those orders happened to be the producer of the Tyra Bank Show. So I was still working out of my West Hollywood apartment and I had my first real big time celebrity client.
Kerry Diamond:
That's great. You write that anyone can build a thriving business with the right mindset. In my questions I wanted to ask you, what does that mean? But I think you just proved to us what that means, it really just is a dogged determination.
Candace Nelson:
It is, it's perseverance, it's continuing to pick yourself up when it seems like things will never work. I remember one moment, there were three locations, I think, that we almost turned into Sprinkles, and we went so far as to bringing in an architect and starting to draw plans, and one after another fell through. Landlords were not excited to lease to us, we had no experience, and they didn't like our idea to begin with.
Kerry Diamond:
Some of them didn't even return your phone call.
Candace Nelson:
Oh yeah, one hung up on me. Our Beverly Hills space, actually that landlord originally said no to us, and we ended up going back after those three had fallen through and begging him, and he eventually said yes, with the key money of course.
Kerry Diamond:
Well, I was going to say yes, but with significant key money. Explain to people what key money is and how much the key money was.
Candace Nelson:
Yeah, so that was a big chunk of change. Basically it was such a tight real estate market that any good location, there was already a tenant in it, and any tenant that was thinking of leaving wanted you to pay the right to take over their business, whether you were planning to use what they had in there or not. So we paid $100,000 to take over the lease of this sandwich spot in Beverly Hills, they had some restaurant equipment in there but we didn't use any of it, we renovated the entire thing. So it literally was just to get the right to be in that space to then pay the rent in that space.
Kerry Diamond:
That's a lot of key money. Usually in New York if you have to pay key money it comes with a liquor license, and that's why it's a little more expensive.
Candace Nelson:
Yeah, we couldn't even sell liquor, you're right, we got totally robbed.
Kerry Diamond:
It worked out in the end.
Candace Nelson:
It did, it worked out in the end. I know, because I think about the time I broke down in the car, it was the third space that we had these hopes and dreams for that fell through, and I was like, maybe it's just not meant to be. And I just looked at Charles and I said, "We've been trying really hard, we've been doing everything we can do to make this happen, and I think this might be the writing on the wall." And between the two of us we picked each other up again and made that call to that landlord and made it happen. And I have to say, if I look back at those original locations we were considering, those weren't the right locations for Sprinkles. Sprinkles Beverly Hills was a very important piece of the puzzle.
Kerry Diamond:
And you talk about a lot of terms that some folks might not be familiar with, I'm going to throw one of them out there, product market fit. What does that mean?
Candace Nelson:
So this is a term that people throw around a lot in the tech world, the investing world, it means that you have found an audience for your product, there is demand for your product. For me, there was so much that I had to do to push my product out into the world. The easiest way for me to describe it is there was a moment when I finally started to feel a pull. And it wasn't just all of my energy being exerted to talk about my product, show my product, seed my product, all of a sudden those calls started coming in, and they started coming in on with their own energy, and their own momentum, and that was when I knew I had some traction. There was an appetite for my product, I wasn't just as loony as they were telling me I was.
Kerry Diamond:
But sometimes people create a product without knowing there's product market fit, you talk about Steve Jobs famous saying. Do you want to talk about that a little bit? It's the opposite of product market fit.
Candace Nelson:
Well, the idea is that sometimes if you're doing something really innovative, people don't even know that they want it until they see it. So maybe if I had surveyed everyone I knew, or even everyone who had a sweet tooth and I'd said, "Do you want to pay $3 for specialty cupcakes?" They probably would've said no. But once I showed them my vision for what that was, and people walked into a Sprinkles Cupcakes Bakery and they felt how different it was, and they had that desire, then they knew they needed those $3 cupcakes.
Kerry Diamond:
You talk a lot about following the breadcrumbs in your book. You should have called them cupcake crumbs, Candace.
Candace Nelson:
Cake crumbs, I know, what was I doing?
Kerry Diamond:
What do you mean by “follow the breadcrumbs?”
Candace Nelson:
I think there's this idea when you're first starting out that you don't know anything but then everyone else has all the answers, and I'm here to say that I knew nothing, and I really did just figure it out. And entrepreneurs in general, so many of them, when you get inside the room with them, they're doing the same thing. When you are doing something new and you're putting something new into the world, you're just in general not going to have all the answers, there isn't a playbook, there isn't always this framework, you are making it happen. So every day is waking up and saying, okay, I know what I want to do, how am I going to get there? And you figure out how you're going to get there, whether that is asking someone in your network.
We had this amazing woman, Karen, she was the mom of a friend of mine, she had a tiny bakery here in Los Angeles, and I'd never worked in a bakery, I had no experience, but she was so kind, and she would invite us over at the end of a rush, and we would sit in her bakery and eat chocolate chip cookies, she would service milk and chocolate chip cookies, and she would just tell us about the equipment we needed to buy, or how to find employees and staff them, and just all of these basic things that we didn't know. So there is so much in just getting after it and asking the questions, and getting the answers, and those answers will lead you to other people who can answer more questions for you.
Kerry Diamond:
I was really struck by that anecdote about Karen, because it was very gracious of her.
Candace Nelson:
Very gracious.
Kerry Diamond:
You technically were competition, you were coming in without having put in the hours and the pain that she had probably gone through. There's a lot of gate keeping, and I think folks are afraid to almost jump the line if they haven't put in the hours, like who am I to ask someone who's done this for a decade? How do you get past that mindset?
Candace Nelson:
These days there is so much collaboration going on. When I was coming up in the career world it was less so. And maybe that was unique to my experience being a woman in investment banking, where there just weren't that many seats at the table, and so people were understandably a bit protective. But this idea of mentorship and supporting and collaboration, particularly among women right now, is just so strong and so inspiring to me. I do think that there are a lot of people who want to pay back and pave a way for the next generation, and Karen was one of those angels. You're absolutely right, we were competition, we were opening a bakery in her town, and she was doing something she loved, she was supportive of us going into business doing something we loved, and I'll never forget that.
Kerry Diamond:
I think I'd mentioned this to you, we start doing more networking sessions, I mean, they're virtual, but networking sessions with the bomb squad members, because when you're an entrepreneur and you're so deep in the weeds, you think these problems are unique to you, but as you're pointing out, they really aren't. I mean, everyone's story is so truly unique, but everyone's problems are pretty much the same. Sometimes other people are just a few steps ahead of you, maybe they're, like I said, a decade ahead of you. I find there's something so comforting in those networking sessions because everybody realizes the commonalities, and that there are people who have the answers, you don't have to slog through things to find the answers.
Candace Nelson:
That support system is so important and I did not have that when I was starting Sprinkles. I had an incredible co-founder in my husband, we are very complimentary in terms of our skill sets, had the same work ethic, and he was also incredible emotional support. But beyond that I thought networks are for people who work in companies, when you're an entrepreneur it's you taking on the world as solo person. And I woke up one day after having my first child, and I looked around, and Charles of course was at work, trying to keep the company on the tracks, and I realized I had no friends. I had no friends, I had nobody to call to ask what mommy and me class to take, or just to vent that I felt really alone, and whatever, was having trouble breastfeeding, and I missed working, or whatever it was, and I made a commitment to myself never to be in that situation again.
And I think I really have turned a page on that, I really nurture my network, whether it's my friendships, my mommy network, my professional networks, just through these organizations, one of which you have started, so thank you for that. It's so incredible to send out an email into the world and have 20 women who you've never met send you a response who just want to help. Those people are out there, so nurture those networks.
Kerry Diamond:
And thank you for the mentoring you've done. You wrote about Azaria Bellamy of Blondry, who we love, fantastic product, and she's someone you've mentored.
Candace Nelson:
She is, and she's the coolest. I love her product, Blondry, please support her everyone, and I just love, speaking of tenacity, she started following me and engaging with my content, and I got to know her name in the comments in my Instagram, and then one day slid into my DMs and just said, she didn't say, "Will you mentor me?" But she did say, "I have some questions and I'm wondering if you would be available to answer a few." And it was just the way she asked, and it just sounded like an easy lift. She did everything right. And so sure enough, all of a sudden I'm Zooming with her, and we're talking about running a bakery, and funding, and all of these things.
I was so impressed with her because Blondry was a side hustle, an incredible side hustle. Azaria had a full time job, and then she was doing these pop-ups where she was amassing thousands of people on these wait lists, and then opening up, baking over a weekend, or a certain period of time, and sending all these orders out and I thought, this is an incredibly creative way to build a business when you can't, you don't have the resources to go all in just yet. And so I was just really impressed with her, and then so I've been mentoring her, but sure enough, this is how savvy she is, she doesn't just have one mentor, she has mentors for every different aspect of her business. So she has a mentorship board, the same way that a company would have an advisory board. I mean, that is genius.
Kerry Diamond:
That is genius.
Candace Nelson:
So I'd really encourage everyone, I mean these days we're a LinkedIn away, we are an Instagram DM away from the people we admire, and the people who hold the answers. And not everyone's going to respond, but some people will.
Kerry Diamond:
The biggest topic, money, and raising money. So you bootstrapped for a long time, but then you did have to raise money. What was the point when you decided you would raise money and how did you go about it?
Candace Nelson:
So we bootstrapped and cash flowed until we sold the majority stake in Sprinkles eight years later.
Kerry Diamond:
Oh, you did? Okay.
Candace Nelson:
Yes, we did, and that was because we had the volume and the profitability early on and started cash flowing really quickly, so that was really incredibly fortunate. Even then we had some decisions to make because within a few weeks even, maybe within the first couple of months, our idea went from, oh, that'll never work, to cupcake bakeries very much like ours started popping up everywhere. So we went from just being happy that people had shown up on day one and were buying our cupcakes to, oh my gosh, being on the defensive a bit. We wanted to grow, and we wanted to grow quickly, but baking everything on scratch, and building a brick and mortar bakery and scaling it across the country, that is not easy to do, and that takes a lot of time.
It just is labor intensive, and we were very perfecting with the details, and people were coming at us with franchises. They were dying to franchise, and that would've been one way to grow really, really quickly, but I was like a helicopter parent to this business, I could not let it out of my vice-like grip. And to be fair, the brand, the product quality, all of that, all the details were so important to us I just couldn't imagine handing over the reins to somebody else. We would've been able to grow a lot more quickly though. Anyway, because we were growing slowly in cash flow we did not actually end up having to raise money, even though people were dying to put money in.
Kerry Diamond:
So you didn't even do a friends and family round?
Candace Nelson:
No.
Kerry Diamond:
Nothing, wow, okay.
Candace Nelson:
No. We did do a friends and family when we started Pizzana, and that was really more about people just wanted to be part of it, and we understand now how incredibly beneficial it is to have these people who have bought in, literally, who are financially invested in your business, as your brand ambassadors, they really treat it even more like a job. And so I would actually, at this point now, encourage people, even though you want to keep as much of your business equity as you can, to include people who really want to be part of it, because they will work for you.
I want to also shout out, there's a baker that I work with a little bit here in Los Angeles, Fleurs et Sel. Have you heard of this cookie business?
Kerry Diamond:
Oh no, writing it down.
Candace Nelson:
There's so many more options and avenues available these days with crowdfunding, and even donations based funding. She is bankrolling her first cookie bakery on GoFundMe. It's a donations-based raise. She's about a quarter of the way there, and I've donated, and I'm trying to help just in terms of amplifying.
Kerry Diamond:
Oh good, we'll check it out. We've supported a lot of GoFundMe and Kickstarters over the years. And I think that's an amazing way. We did a Kickstarter in the early days, but if you don't have access to capital, but you do have a great product and a bit of an audience, it's a great way to start.
Candace Nelson:
And if you've got a great product, you've got a business. And the fact that people are donating because they want a place to go to eat her cookies because they were that exceptional, I mean, what a testimonial to the product she's created. And she's a beautiful story, and she's just a lovely person, so trying to shout that out.
Kerry Diamond:
Oh good, thanks for the shout up, that's fantastic. And GoFundMe, folks probably know this by now, but GoFundMe, you can set a target, but you still get the money if you don't hit it, versus Kickstarter, if you don't hit the target you lose everything, it's all or nothing.
Candace Nelson:
And what was that process like for you on Kickstarter?
Kerry Diamond:
It was interesting, because I know so much more now than I did then, like everything, and I probably would've done it a little differently. I'm very bad at asking for things, whether it's help or money, you name it, I know a lot of entrepreneurs have that in common, and I felt like I was bothering people. They really encourage you to send out a lot of emails, and tell your network, and share, share, share, and I was like, oh gosh, how much can I bother my network with this? And then the number of friends who when it was over, when the deadline had come and gone, were like, "What's the deadline again for your Kickstarter?" Or, "Can I still do your Kickstarter?" And I was like, "No, it ended a month ago." I don't know, it's such a fine line between-
Candace Nelson:
You needed to be more bossy.
Kerry Diamond:
Yeah, exactly. And I guess that's what it boils down to for asking money in any respect, you just have to get a thicker skin and just do it.
Candace Nelson:
It's true. I know, people can ignore your email if there's too many coming at them. I'm in the same boat, I am trying to embrace my inner bossy in marketing this book, but I don't like asking for things. I have the same mindset as you, I like just going out and doing it myself. I'm a doer and I'm a go-getter.
Kerry Diamond:
You brought up something that I want to talk about, and it's competition. Because along with this rise in entrepreneurism there's so much copycat stuff going on, and I'm shocked how many people send me products and I'm like, "But so and so is already doing that, and doing it beautifully." I'll throw out one example that's kind of sad, Anita Shepherd, who's a good friend of Terry Baum, she has a beautiful product called Anita's Coconut Yogurt, recently announced she was closing the company. And every time I walked into a supermarket, a small specialty goods place, I would see Anita's beautiful product, and in one of my first restaurants we used her product, and it really was just an extraordinary product. So many big companies, well big and small, jumped on the coconut yogurt trend and the market was just flooded with other products, and you mentioned that you had to deal with that.
Candace Nelson:
Mm-hmm.
Kerry Diamond:
What do you do if you're in a category and all of a sudden you're just crushed?
Candace Nelson:
I was really, even though I'd spent some time in the business world, I still was pretty naive when it came to that. I was really taken aback by how quickly competition sprouted up, and how closely it all resembled what I had just put two years of my life and all of my life savings into. I was like, wait, people can do that? They're copying me. It's like art class when you're in grade school.
So what I would say to people is count on that, count on the fact that if you are successful, which let's hope and pray that you will be successful, but just know that the next hurdle you're going to have to get across is the fact that they're going to be breathing down your neck. So it's about either speed, which we didn't embrace as much, or really leaning into brand, which is what we did embrace. So part of that was we said, okay, we've got this great product, we only have one or two stores, how are we going to defend our brand? So we partnered with William Sonoma, did a cupcake mix. So all of a sudden, even though we had two stores, people were starting to see the Sprinkles brand in stores across America, and the idea was that then they would know our brand when we eventually opened in their market.
The other thing I did personally was really lean into personal brand. I really think this is a huge differentiator for people is knowing your why and your purpose in your business, but also making sure that you are stepping into your personal brand, because people buy people, she used her name, obviously her brand was very humanized, but people are distrustful, they want to trust the brands that they are supporting, they want to know who's behind them, they want to know their story, and they want to know their why, they want to help buy into that, and that creates alignment. But I also think it's a real differentiator. But then also trying to defend your product as much as you can. I mean, when we went into cupcakes, I knew that I was essentially going into what was a commodity business. Anyone can make a cupcake, there was almost nothing I could defend about our business except for the brand and the decoration. So early on with those graphic modern dot decorations, which you mentioned, were my new modern take on the traditional sprinkle, those dots became really synonymous with our cupcakes, so much so that we applied for a trademark, and were granted trademark protection on the dots. So whatever else other cupcake businesses across the world could emulate, they could not put a modern dot on their cupcake, and that ended up being incredibly important. It was one of the few things we could defend. And so to this day, when someone sees a cupcake with that dot, they think of Sprinkles.
So any way that you can defend your business, whether it is with scaling quickly, being ready for that from the get-go, or having some defense in terms of intellectual property, and then differentiating through brand and personal brand, I think is increasingly important these days, and what consumers are starting to expect. I know when people send me a product, I'm doing some angel investing now, and people will send me a website to the product, the first thing I do is I look at our story. I look at who's behind it, I want to know what their why is, and I got one the other day and there wasn't even a page, it was a female founder. I mean we've got the shopping power out there, we've got the spending power, I want to buy other female founded businesses and products, the fact that she did not have a page about her story.
Kerry Diamond:
You cover all this beautifully in the book, you have sections on trademarking and patenting, so for folks who maybe are a little confused about that part, or want more information, that is all in the book. Same as personal branding. Thanks for everything you've done over the years for women and for entrepreneurs, and for sharing all your knowledge, it's great.
Candace Nelson:
Right back at you, thank you so much and thank you for having me.
Kerry Diamond:
That's it for today's show, thank you so much to Candace Nelson for joining me today. Her new book is Sweet Success, and you can find a copy at your favorite local bookstore.
Thank you to Cambozola for supporting Radio Cherry Bombe. If you enjoyed this episode, leave us a rating and a review on your favorite podcast platform, we would love to know what you like about the show, and any future guests you'd enjoy hearing from.
Radio Cherry Bombe is a production of Cherry Bombe Magazine. Our theme song is by the band Tralala. Big thank yous to Joseph Haaen, studio engineer for Newsstand Studios at Rockefeller Center, and to our assistant producer Jenna Sadhu. And thanks to you for listening, you are the Bombe.