I think what is amazing is that you two stayed a married couple and still love and support one another. Business, money, homes, etc will come and go, but your marriage is the foundation. Good on you for that!!
Unfortnuealy, due to the way Americans have shaped their TV culture, this can never be something that makes it to a series. Only flashy/good vibes sells. I do agree that you learn infinitely more in failure than success.
for sure, People don't understand that scaling up fast can destory everything rapidly, because of how demanding and how many new variables it presents. I know of a burger shop owner that was pulling in over 1 mill profit a year and decided to rapid expand into 4-5 new shops within 3 years of his first and ohhh boy... he went bankrupt within 5 years.. he never had the right people in place and problems kept happening one shop after the other and it got to the point where he had to shut down 2 spots while still on the lease. Eventually quality went down and everything snowballed and booom, gone forever.
The minute you start taking debt to open more stores or factories is the minute your business is on borrowed time, in other words, whether or not you make money, you're always on the back foot. It's much better to stay strong and small and grow slow than jump head first into massive debt. I started a shampoo bar businesses pre covid and did extremely well staying small, online and very local, unfortunately covid and the rise of cheaper, inferior shampoo bars meant we struggled to compete but we closed our business on a high and walked away with a very decent amount of cash in the bank, no debts, no credit and no issues with future businesses.
As a longtime Ample Hills supporter, I respect Brian and Jackie so much! Not only is their product amazing, they’re both really grounded and solid humans. Friends and I have had many bday parties at their BK location & they’ve always been so kind, always. It broke our heart to hear them walk away - beyond wondering what would happen to my favorite flavor Ooey Gooey lol - what would become of them? So once we heard that they opened The Social, it was a sigh of relief. Watching/hearing their story is so incredible and inspiring to me as a business owner and hits different because they were/are so beloved in the community.
Come up with a bad idea that loses millions a year in its best year, get investors to fork out millions to cover your losses, your bad idea fails. Then repeat.
This happened to my brother, but mostly because of the pandemic. He grew fast and then the pandemic hit and sales halted. But he built it back and it’s going really well now.
The headline is so misleading. The only reason they had to declare bankruptcy was that the couple drained the company for such much money in the previous years they took out so many millions. this was the only reason why they had to declare bankruptcy if they were not that greedy, all would not have happened. after the bankruptcy, they were still richer than ever they had way more money, as when they started. I only feel sorry for their employees. This was gross mismanagement by a greedy couple
Exactly.. This was never a $40 M business. Valuation is based on earnings. Based on this story they had massive losses and a valuation 4x revenue. No way…
focusing on profitable locations is a great decision imo. i had a smaller business than ample hills that i grew through establishing new locations. i never went bankrupt, but i did sell to a large corporation and found that my quality of life tanked. now i have a single location that is 75% the size of my all of my five locations i used to own. it's much easier to manage for an individual owner with no partners or investors and my quality of life is better than before. i don't earn the really big money i earned before, but i'm happy. that's worth it. i hope brian and jackie have the same outcome
So they lost millions for their investors, screwed over their suppliers and creditors who they couldn't pay back, then repurchased the business back a few years later for almost no money and are now proudly proclaiming that they're giving it a second shot? It's actually pretty appalling that they're allowed to repurchase a business they themselves drove to bankruptcy; everyone else got screwed while they got out with their business on the other end without the debt it previously held and also with massive losses they can carry forward to essentially never pay taxes ever.
Everyone else didn't get screwed. You're assuming that their suppliers, likely quite large, got screwed somehow. Likely not true. Creditors are also assuming risk in these scenarios, including not getting paid back. And they'll be fine. Repurchasing the business for a fraction of the cost is part of the process and it seems that Schmitt didn't do anything good to increase the value/purchase price.
@@jtcash44 Well a bankruptcy in it's very essence means that the company couldn't pay back its creditors and defaulted on its payments as a result. During bankruptcy proceedings, there's a specific order based on which creditors of the company are paid back (secured creditors, then preferential creditors, unsecured creditors, etc). I'm not an expert, but my expectation is that suppliers would not have had priority and some would not have been reimbursed as a result. Either way, though, some of their business partners (creditors) most definitely got screwed over, to varying extents. Now to cast that off as "they'll be fine" is purely an assumption on your part, although what's for certain is that some lost money because of the company's poor management. Finally, your claim that "repurchasing the business for a fraction of the cost is part of the process" is so absurd that I don't know how you could even believe that. The whole point of bankruptcy is to take ownership of the company away from the existing shareholders, who weren't able to run the business profitably.
The 2 of them had no prior business experience and somehow managed to raise so much money in the United States for an ice cream business. Why must everyone feel that they must scale immediately and become an overnight global brand? Slow and steady.
@@jtcash44 Looks like they deleted my comment so I'll respond again. I don't know what your understanding of a bankruptcy is, but when a supplier provides goods or services to a customer and they don't get compensated for it, they got screwed. Of course they assume risk, but that's like you buying products on Amazon, not getting the products and then being told that "you knew the risk". And what exactly do you mean by "part of the process"??? Bankrupting companies to repurchase them later is a healthy business strategy?
@@Tropical_Frank Well they sought out the investment. You have to be pretty convincing and make big commitments for people to give you millions, so they are no victims in all this.
as a brooklyn native, i have fond memories of frequently dining at their establishment. it was a place where i would bring my friends, immersing ourselves in the diverse culture and feeling the warmth of love. i am truly honored to see them back in action. this segment has not only been informative about business and scaling but has also reminded me of the love they bring to the community. a heartfelt salute to you and your team!
@@tristank1 with such people like you my friend, I have everything to get up there. Big thanks to you, and wish you everything that you can only imagine.
Ever wonder how the most caustic criticisms are usually from those who’ve never run a business? At least not in real life. They’ve only done a shitload of case studies in business school and believe they know all there is to know about running a business. Congratulations Brian and Jackie on getting your business back! And many cheers to your love story. From one entrepreneur to another, I wish you Godspeed.
It's crazy that you can go bankrupt and screw all the investors and suppliers who you owe money to and then just refresh and start again. The laws in the US are pathetic. In my country, if you go bust, you can't be a director of a company for 7 years, there are consequences! Maybe this story should have included the people who lost money the first time around that never got it back, you know, just to be thorough!
It’s good to hear their story ended on a positive note. One thing that is often overlooked with newer growing businesses is a competent CFO. When you get that amount of funding coming in it’s like hitting the lottery and you really need someone well experienced with financial projections to model out the costs of those big investments before committing to a large multi-year lease like that. Another thing is opening locations far away from your original market is difficult. Now you are spread thin with locations across the US and unable to maintain quality control. A better option could have going the franchising route which brings in an experienced operator with financial risk (skin in the game).
This is the exact thing I thought when I saw the LA and FL offices were opened. It's hard enough being a landlord in different cities b/c even the best property management companies can lose their flair, damaging their clients and the client's interest in the process. For me, I've found, it's best to conglomerate nearby, to be available if necessary and involved.
There is a podcast that give the whole complex story. My takeaway was that they where greedy and sooo stupid in the way they wanted to run/expand the business. They take no personal responsibility deep down. Totally bizarre and fascinating
@@wawahweewah sounds about right.. it was totality revealed when he responded with "what, are you kidding me, I don't understand that" when their director told them they were screwed... seeing how before their major expansion they were already operating at a insane net loss.
@@law4853 yeah mate that’s what I thought too. I just find it crazy how they accepted like victims. Now they back in for another round!! Psychos!!! Scoop psychos 🤣
Their biggest mistake is the most obvious. A 25000 sq ft facility in Brooklyn. No wonder they couldn’t meet overhead. Could of found a rural dairy farm to partner with and probably still be in business and avoided bankruptcy. Why can’t city people think outside of their box. Shut the factory down and relocate it. Dang
Yes as a mfg in the furntiture industry in Los Angeles ! if i need more space i would 100% be looking at a location that the business can afford to lease or better yet purchased...
Seems like a great deal. You build up your company - owe a lot of debt - then file for bankruptsy - you get to keep most of your stuff - the companies that lost tons of money by supplying your company with their products get maybe pennies on the dollar. You reopen with the huge stock of items you never pay for - no one gets hurt right?
That's an inspiring story! They must have been over the moon when they could buy back their original chain. I've started a few businesses - tiny, nothing like theirs - but letting go of a business that you've run for years is like letting go of a child.
I agree. I had two childcare centers for 14 years and burned out of the biz. Hard to sell but I did. Then within months ..COVID hit. It hurt the new people bad.
The moment the got the VC funding, they were destined for the death spiral. They were not ready for that level of expansion when getting that funding. A very critical lesson in knowing when to push the expansion button or not. Just because there’s money you can tap it doesn’t mean you should. An incredibly painful experience if you love business.
They were a small business with no knowledge about how companies work. Tried to expand too quickly and fell quickly. Now they got back their original brand i doubt investors will be likely to lend money knowing their history so another fail right there
@@chaikagaz they prob feel content with what they have now. Having someone help with finance management and knowing when to grow, if you don't know....is vital.
Wasn't Amazon losing money for 9 years running? A lot of your success will come from the people you employ to help you run it. Ray Kroc was headed for bankruptcy until a chance meeting with a financial analyst that changed his whole life and created McDonalds that it is today.
thanks for your story. im also a small business owner, since about ten years, with no VC funding and now im reassured that this was the right way to go. many thanks and i hope that in a few years you will expand to europe where i live and ill visit your store for sure!
Opening that factory is what hurt them the most! If they would have had some type of mentor they would of advised to use a copacker! NOT OPEN A DAM FACTORY! It’s like buying a multi million dollar piece of equipment or renting it for a fraction of the price.
they built a factory to manufacture ice cream. I am not sure how copacker helps in that case. here the main problem is that they didn't have proper estimation, and risk management. running a multimillion business requires proper risk management.
Brian and Jackie just got fired so you are going to need to do an update video. As someone from the area where their shops are its fascinating seeing them and Van Leeuwen both emerge and one struggle while the other take it's spot.
Fired how? I thought they were the owners? Or is the company public and I completely missed that? Also funny because I just saw the video on Van Leeuwrn and their killing it!
Been there done that 32 yrs ago worked hard to make the come back, stayed married, now retired own our house.. best wishes to them both, there will be ups and downs ,just stick with it
I had an health scare about 10 years back, and the last thing I was bothered about was money. All I could think about was will my wife and son be ok without me.
Interesting story. Read up a bit on them. Jackie Cuscuna and Brian Smith say they’ve been fired by the very investors they helped entice to buy back the business,
Buy the things you need with the money you have on hand - if you don’t have the money don’t buy it. Your business may stay small but small and profitable is way better than the alternative.
As someone who has grown a multimillion dollar brand from scratch, in the past 3yrs, stories like this are of continued value. I have had many businesses over the years, but strong momentum can be more deceiving than certain struggle, just due to overconfidence. I am much more slow paced with my scaling, and while investment dollars would likely propel me into 8 figures, that machine size just isnt for me right now. Great story to watch and reinforce my mindset for sure!
Why do people make a success so complicated and complex? Why do all that "expansion" when one could make a big profit and be perfectly content with a single store, or a few?
I am facing corporate and personal bankruptcy, as we speak. This has been the hardest and most emotionally and mentally damaging past two years of my life, trying to save my company. I have made mistakes, and compounded them by taking more risks and have also been met with many challenges I wanted to believe we could overcome (like our staff forming a union for a two location business, during the pandemic. Then they all left us). But I believe(d) in my company and chose to fight for those fighting for the company. But now I fear that in spite of the best of intentions and efforts, it is for naught, and I am doomed. To my wife and kids, I am sorry. I have never been in such a dark place with so much negative self talk. I want to move on, but the prospect of the bankruptcy is so scary. I want to see this through, but continuing to fight with me at the helm is not going to work either. We have a super strong brand and product, but we just can't overcome the challenges/debt we are facing.
@jtcash44 Sounds like you had something that worked enough to grow to have employees. Take note of the wins and the courage to start such a thing and lessons you learned from the things that didn’t work. For the employees that decided to start a union, listen to the realistic concerns and consider starting again. Many business winners had many failures before they found success. Entrepreneurs take chances many don’t
How could they underestimate the number of scoop shops to keep the factory operational by such a huge margin. Seems like some math and statistics and a little bit of gut feel would have answered that question that ended up killing the biz.
It's a small mom and pop shop that drank the SF/SV koolaid and went in bed with VC. Basic business principles aren't required as the VC just want to hype it and hope some numpty comes and buys it or they can just write it off; they get their 2/20 regardless. VC is a lucrative job for the partners. Heads getting c*t off if they are held in the same standard as Hedge Funds.
Super interview, thanks for sharing. Sorry you had to go through 10 years of grinding for that to happen but omg to pull back through the otherside is very inspiring. Ppl dont realize how failing forward really makes for successful future, that experience, you can not buy it ❤ Blessings to you both and your business ❤
I lived 2 blocks away from Ample Hills on St. Marks in Brooklyn. It was a great Ice Cream shop and I like most of the flavors. They even opened one in Astoria, Queens. So sad to see the shops closed and happy to see them re-opened 🙂
love how they didn't stop at an appropriate point to keep demand up and maintain an intimate brand experience, but went the disease route of massive endless capitalistic expansion, which is obviously unfeasible and somehow encoded into our greedy American minds these days. Also, imho, It's ice cream, they weren't bought by a mega corp like nestle, so the business was doomed the second they expanded out of NYC, or even their original location.
They got to 13 stores total. Their problem was 2-fold-- yes, overexpansion (3 of 13 stores were in Florida & California) but also the factory decision. That was driven by their risky gambit to add that factory before growing to an appropriate size to definitely support it. They probably could have added an additional NYC production shop or two to smooth the transition and limited their expansion vision to Long Island, southern New England, and coastal New Jersey to find a better balance first. Or they could have moved production somewhere along I-87 or I-95, where land and labor definitively cost less. Right now their decision to focus on profitability is helpful, as that's ultimately what business is about. It's got to generate a profit sometime, so it might as well be early.
Happened to one of the brand at my local place, they grow sooo fast, opening branches one every 2 weeks, they were everywhere serving coffee, cakes, cookies, butter cookies etc. At one time I said Wow they must be doing really good with their financial, there should be tonnes of VCs or banks willing to lend them the money for them to grow faster but I notice something is not right, their shop is not fully crowded, some small entrepreneurs starts to open their own coffee shop serving almost the same things at smaller scale, they didn't make enough ads for people to recognize them (they put banners everywhere, under flyover, traffic stops, billboards, join events to open small booths, flyers distribution to local mall, discounts, coupons, limited time offer etc.) but their menu hasn't changed at all, the price were extremely overprice at some point, they didn't listened to their customer's complaint about some of their menu and didn't make any improvement to the existing menu, they keep opening branches some of them come close to one another like 1-2 miles from each others serving the same things and the shops layout (the design and colors) is not welcoming at all, the staff is not friendly and in some cases were rude to their customers. I would assume that they wont make it in the next 12-18 months if they keep going with this attitude or work ethics, people will eventually hop in to smaller shops which offer a lot more price to value to taste performance.
not to blast in here being all negative, but it doesnt seem like they really learned their lesson. I think they have a fantastic product, and that alone should be enough for any business to start small, grow organically without any external investment. Otherwise your just an employee to the investors, 100% at their mercy, givign up big $$ cuts of your own profit.
You're right. Unfortunately they were fired by the investor of their comeback. I'm an artist so not very business savvy but even I know that involving investors in my business means that they can fire me, which is just not an option for me as a business owner. If I want to be fired, I'll work a 9-5. I would have gone back to the ice cream cart, then a small shop, grown that and been at peace with a small shop, just one. No more of this expansion talk. Instead they created a holding company with the investor, gave him all the power and now they're jobless.
Don't blame the factory. You were losing $1.6 million a year BEFORE the factory. The factory just amplified poor decision making. Then, when your sales increased 30% you didn't get any leverage, you lost MORE money. Keep you overhead low, and try to self finance your expansion.
They made stupid decisions why would you build a giant ice cream factory in one of nycs most expensive neighborhoods and then relied on 15 brick and mortar’s no wonder that company didn’t want there help
It's not the size that matters, it's the motions! 😂 You'll be rocking & swaying much more than Ruby driving everywhere. I compare our truck camper to driving an ambulance. We have no sway hauling our 5th wheel. We cannot wait to see where you go - small!
In retrospect they grew too quickly to include out of state. They went out right at the time of Covid, which likely would have been a hindrance to sales for years.
starting one solid shop and then growing it to 1-2 more is the best in my opinion instead of rapid expansion because then you have factors such as overhead, employee retention and management issues as well with rapid expansion but slow and steady growth allows you to see different perspectives and growth opportunities to better manage a business
Great story! Business is very hard! Having owned various types of businesses over the years. I know exactly what it’s like to feel like you’re on top, and then have everything come crashing down. Crawling out of that is TOUGH
Viral ice cream Got overexcited no business school and experience Went over growth spree Got bankrupt due to lukewarm sales and not enough money to sustain own factory Got bought by investment fund Kicked them out Started another ice cream This time wiser and slower Bounced back Rebought original company
There is more pros in being a business owner than an employee > it's FREEDOM, financial and time. Anything that is worth something takes perseverance and work. Sadly the school system teaches you to go to college, get in debt and get a job = Just Over Broke ❗️
As a loyal viewer of CNBC, I thoroughly enjoyed this couple's story as I am am from the neighborhood in Brooklyn where the first got started. Would definitely love to see more "bounce back stories" like Brian and Jackie's because this information is incredibly valuable to small business owners and entrepreneurs that are trying to scale, but lack this kind of knowledge from behind the scenes.
Great story for everyone you don't get many turnarounds like this. really motivation for people who r getting into business and struggling to survive. hats of to both of you Great business people. Godbless the business and the ice creams
I remember this ice cream shop on the west side of Manhattan. They didn't have the simplest of flavors in stock, and the line was a mess trying to figure out how to order in a dark dank giant flea market of a room.
Then you will never expand... Money today is worth more than money in the future. Therefor debt to expand and increase revenue faster makes more sense. The key is to not fail on your cash flow analysis. Which these folks clearly did with their original factory.
I like it when people try again after failure. Hope it works out this time. Failure is to be learned from, it only becomes stupid if you repeat the same mistakes.
I have been similar situation with my family business Most important thing is keeping the marriage alive I think Now we are in a better shape financially We are so grateful that my family are remained intact after all those difficult time passed God bless!
This was decent ice cream on Boardwalk in Disney. They didn’t seem too switched on with finances- to be told that you haven’t got enough money to see it through winter and say ‘What?’ indicates taking the eye off the ball/ some naivety to me as someone who runs a business. Over expansion was a mistake. Hopefully they will now make a great success of it- great product.
Very inspiring, thank you to the business owners for being transparent and willing to let us see the good and bad. Unfortunately the lessons continue because after this feature, they were fired by the new investor Its perfectly acceptable for us to grow our businesses without outside help, the moment we bring on investors, we are at their mercy and can be terminated. Since I'm not willing to be terminated from my own company, going the investor route isn't for me. Maybe theres someone who is very business savvy that can speak more on this, I don't have the ability to articulate it all.
I think what is amazing is that you two stayed a married couple and still love and support one another. Business, money, homes, etc will come and go, but your marriage is the foundation. Good on you for that!!
So true
That's right 👋
Well said, totally agree!
Nice people do exist
Yeah cuz we know too many women leave when the money hiccups.
I hope this becomes a series. This, to me, more valuable than seeing how entrepreneurs built their original business. I wish them so much success!
How did you get into capital I need help on that I'm a business owner and I'm struggling to find that
i hope so as well. it’s very informative; showing empathy in a (business) world, that can seem so cold from the outside.
100% !
Unfortnuealy, due to the way Americans have shaped their TV culture, this can never be something that makes it to a series. Only flashy/good vibes sells. I do agree that you learn infinitely more in failure than success.
Definitely! More of this. Success is great but showing more hoops and hurdles they had to jump through to get back and rebuild was incredible.
THANK you for highlighting a different type of story rather than pure success stories.
every success story has a ton of failure in it
What?? They operated at a loss for years? Is this the biggest ice cream drug laundering front?
A teachable business story on the cons of scaling up too fast. I'm glad they are building back and better. This is an incredible story.
I agree with you.
Trying to get big fast undermines product and service which in turn impacts customer retention.
It is basically self-sabotaging.
Not to mention low quality by cutting costs. At that point they killed themselves
@@chaikagaz Yep
for sure, People don't understand that scaling up fast can destory everything rapidly, because of how demanding and how many new variables it presents. I know of a burger shop owner that was pulling in over 1 mill profit a year and decided to rapid expand into 4-5 new shops within 3 years of his first and ohhh boy... he went bankrupt within 5 years.. he never had the right people in place and problems kept happening one shop after the other and it got to the point where he had to shut down 2 spots while still on the lease. Eventually quality went down and everything snowballed and booom, gone forever.
@@law4853 Wow. That is really a terrible situation.
The minute you start taking debt to open more stores or factories is the minute your business is on borrowed time, in other words, whether or not you make money, you're always on the back foot. It's much better to stay strong and small and grow slow than jump head first into massive debt. I started a shampoo bar businesses pre covid and did extremely well staying small, online and very local, unfortunately covid and the rise of cheaper, inferior shampoo bars meant we struggled to compete but we closed our business on a high and walked away with a very decent amount of cash in the bank, no debts, no credit and no issues with future businesses.
As a longtime Ample Hills supporter, I respect Brian and Jackie so much! Not only is their product amazing, they’re both really grounded and solid humans. Friends and I have had many bday parties at their BK location & they’ve always been so kind, always. It broke our heart to hear them walk away - beyond wondering what would happen to my favorite flavor Ooey Gooey lol - what would become of them? So once we heard that they opened The Social, it was a sigh of relief. Watching/hearing their story is so incredible and inspiring to me as a business owner and hits different because they were/are so beloved in the community.
Beautiful
i call bs on this. you dont know them at all. dont make stuff up
Come up with a bad idea that loses millions a year in its best year, get investors to fork out millions to cover your losses, your bad idea fails. Then repeat.
Easy to repeat on someone eles dime but maybe he has them on a short or very short leash..
All business investments are a risk....DUH.
Im sure those people who invested had the money to lose.
This happened to my brother, but mostly because of the pandemic. He grew fast and then the pandemic hit and sales halted. But he built it back and it’s going really well now.
In what industry?
@@nm3547brothel
The headline is so misleading. The only reason they had to declare bankruptcy was that the couple drained the company for such much money in the previous years they took out so many millions. this was the only reason why they had to declare bankruptcy if they were not that greedy, all would not have happened. after the bankruptcy, they were still richer than ever they had way more money, as when they started. I only feel sorry for their employees. This was gross mismanagement by a greedy couple
To me, this is as much about a successful marriage as it is about business. Truly inspirational.
ding ding ding!
but when he said it's his fault, she never consoled him, it means she was probably mad at him.
The graphic at 5:15 tells me this wasn’t a $40M company. Growth last couple years was decent but not amazing, with a massive increase in costs.
Exactly.. This was never a $40 M business. Valuation is based on earnings. Based on this story they had massive losses and a valuation 4x revenue. No way…
How many were left owed money when the bankruptcies occurred?
Ain't no local ice cream company worth that much. Anyone with a little financial knowledge knows that.
focusing on profitable locations is a great decision imo. i had a smaller business than ample hills that i grew through establishing new locations. i never went bankrupt, but i did sell to a large corporation and found that my quality of life tanked. now i have a single location that is 75% the size of my all of my five locations i used to own. it's much easier to manage for an individual owner with no partners or investors and my quality of life is better than before. i don't earn the really big money i earned before, but i'm happy. that's worth it. i hope brian and jackie have the same outcome
So they lost millions for their investors, screwed over their suppliers and creditors who they couldn't pay back, then repurchased the business back a few years later for almost no money and are now proudly proclaiming that they're giving it a second shot? It's actually pretty appalling that they're allowed to repurchase a business they themselves drove to bankruptcy; everyone else got screwed while they got out with their business on the other end without the debt it previously held and also with massive losses they can carry forward to essentially never pay taxes ever.
Everyone else didn't get screwed. You're assuming that their suppliers, likely quite large, got screwed somehow. Likely not true. Creditors are also assuming risk in these scenarios, including not getting paid back. And they'll be fine. Repurchasing the business for a fraction of the cost is part of the process and it seems that Schmitt didn't do anything good to increase the value/purchase price.
@@jtcash44 Well a bankruptcy in it's very essence means that the company couldn't pay back its creditors and defaulted on its payments as a result. During bankruptcy proceedings, there's a specific order based on which creditors of the company are paid back (secured creditors, then preferential creditors, unsecured creditors, etc). I'm not an expert, but my expectation is that suppliers would not have had priority and some would not have been reimbursed as a result. Either way, though, some of their business partners (creditors) most definitely got screwed over, to varying extents. Now to cast that off as "they'll be fine" is purely an assumption on your part, although what's for certain is that some lost money because of the company's poor management.
Finally, your claim that "repurchasing the business for a fraction of the cost is part of the process" is so absurd that I don't know how you could even believe that. The whole point of bankruptcy is to take ownership of the company away from the existing shareholders, who weren't able to run the business profitably.
The 2 of them had no prior business experience and somehow managed to raise so much money in the United States for an ice cream business. Why must everyone feel that they must scale immediately and become an overnight global brand? Slow and steady.
@@jtcash44 Looks like they deleted my comment so I'll respond again.
I don't know what your understanding of a bankruptcy is, but when a supplier provides goods or services to a customer and they don't get compensated for it, they got screwed. Of course they assume risk, but that's like you buying products on Amazon, not getting the products and then being told that "you knew the risk".
And what exactly do you mean by "part of the process"??? Bankrupting companies to repurchase them later is a healthy business strategy?
@@Tropical_Frank Well they sought out the investment. You have to be pretty convincing and make big commitments for people to give you millions, so they are no victims in all this.
as a brooklyn native, i have fond memories of frequently dining at their establishment. it was a place where i would bring my friends, immersing ourselves in the diverse culture and feeling the warmth of love. i am truly honored to see them back in action. this segment has not only been informative about business and scaling but has also reminded me of the love they bring to the community. a heartfelt salute to you and your team!
Even I am at my lowest point in my life, I feel so happy for this amazing couple. This story is Truly inspiring
it's all up from here! ❤
I'm there too
I wish the best for you and I really hope you can turn things up again and become successful
@@tristank1 with such people like you my friend, I have everything to get up there. Big thanks to you, and wish you everything that you can only imagine.
Ever wonder how the most caustic criticisms are usually from those who’ve never run a business? At least not in real life. They’ve only done a shitload of case studies in business school and believe they know all there is to know about running a business.
Congratulations Brian and Jackie on getting your business back! And many cheers to your love story. From one entrepreneur to another, I wish you Godspeed.
It's crazy that you can go bankrupt and screw all the investors and suppliers who you owe money to and then just refresh and start again. The laws in the US are pathetic. In my country, if you go bust, you can't be a director of a company for 7 years, there are consequences! Maybe this story should have included the people who lost money the first time around that never got it back, you know, just to be thorough!
They've been fired now so they finally suffered the consequences
It’s good to hear their story ended on a positive note. One thing that is often overlooked with newer growing businesses is a competent CFO. When you get that amount of funding coming in it’s like hitting the lottery and you really need someone well experienced with financial projections to model out the costs of those big investments before committing to a large multi-year lease like that. Another thing is opening locations far away from your original market is difficult. Now you are spread thin with locations across the US and unable to maintain quality control. A better option could have going the franchising route which brings in an experienced operator with financial risk (skin in the game).
This is the exact thing I thought when I saw the LA and FL offices were opened. It's hard enough being a landlord in different cities b/c even the best property management companies can lose their flair, damaging their clients and the client's interest in the process. For me, I've found, it's best to conglomerate nearby, to be available if necessary and involved.
People tend to scale up too soon. Run only what you can handle
This NEEDS to be a series. So much to learn!
There is a podcast that give the whole complex story.
My takeaway was that they where greedy and sooo stupid in the way they wanted to run/expand the business. They take no personal responsibility deep down. Totally bizarre and fascinating
@@bebop355definitely not naive. They moved too fast the first time once they got funding.
@@wawahweewah sounds about right.. it was totality revealed when he responded with "what, are you kidding me, I don't understand that" when their director told them they were screwed... seeing how before their major expansion they were already operating at a insane net loss.
@@law4853 yeah mate that’s what I thought too. I just find it crazy how they accepted like victims. Now they back in for another round!! Psychos!!! Scoop psychos 🤣
Their biggest mistake is the most obvious. A 25000 sq ft facility in Brooklyn. No wonder they couldn’t meet overhead. Could of found a rural dairy farm to partner with and probably still be in business and avoided bankruptcy. Why can’t city people think outside of their box. Shut the factory down and relocate it. Dang
Yes as a mfg in the furntiture industry in Los Angeles ! if i need more space i would 100% be looking at a location that the business can afford to lease or better yet purchased...
They think like liberals, not like business people. I’m surprised they were not taken advantage of sooner..
@@johnhungerford3814 Even conservatives grow too fast when investors push to become bigger,...what's your point??
No repercussions they just file for bankruptcy and start over again why would they have to make good decisions
@@johnhungerford3814well at least they don't think like the concervative darling Donald Trump. They only had the one bankruptcy while he had like 5
They’ve raised $19 million in 2 years or so, and lost 15-16 million dollars over 3 years, and were surprised they’re out of cash? What?
It looks like they had not been profitable in years. This is a problem.
Obviously they have a passion for making good ice cream but were not very well educated in finance or business.
Seems like a great deal. You build up your company - owe a lot of debt - then file for bankruptsy - you get to keep most of your stuff - the companies that lost tons of money by supplying your company with their products get maybe pennies on the dollar. You reopen with the huge stock of items you never pay for - no one gets hurt right?
That's an inspiring story! They must have been over the moon when they could buy back their original chain. I've started a few businesses - tiny, nothing like theirs - but letting go of a business that you've run for years is like letting go of a child.
I agree. I had two childcare centers for 14 years and burned out of the biz. Hard to sell but I did. Then within months ..COVID hit. It hurt the new people bad.
The moment the got the VC funding, they were destined for the death spiral. They were not ready for that level of expansion when getting that funding.
A very critical lesson in knowing when to push the expansion button or not. Just because there’s money you can tap it doesn’t mean you should. An incredibly painful experience if you love business.
They were a small business with no knowledge about how companies work. Tried to expand too quickly and fell quickly. Now they got back their original brand i doubt investors will be likely to lend money knowing their history so another fail right there
@@chaikagaz they prob feel content with what they have now. Having someone help with finance management and knowing when to grow, if you don't know....is vital.
never take on investors for this type of non tech biz. just grow organically
they got greedy. wanted to be tech billionaires when they have no clue what business thye are in
Wasn't Amazon losing money for 9 years running? A lot of your success will come from the people you employ to help you run it.
Ray Kroc was headed for bankruptcy until a chance meeting with a financial analyst that changed his whole life and created McDonalds that it is today.
thanks for your story. im also a small business owner, since about ten years, with no VC funding and now im reassured that this was the right way to go. many thanks and i hope that in a few years you will expand to europe where i live and ill visit your store for sure!
Opening that factory is what hurt them the most! If they would have had some type of mentor they would of advised to use a copacker! NOT OPEN A DAM FACTORY! It’s like buying a multi million dollar piece of equipment or renting it for a fraction of the price.
they built a factory to manufacture ice cream. I am not sure how copacker helps in that case. here the main problem is that they didn't have proper estimation, and risk management. running a multimillion business requires proper risk management.
Brian and Jackie just got fired so you are going to need to do an update video. As someone from the area where their shops are its fascinating seeing them and Van Leeuwen both emerge and one struggle while the other take it's spot.
Fired how? I thought they were the owners? Or is the company public and I completely missed that?
Also funny because I just saw the video on Van Leeuwrn and their killing it!
Losing $7 million a year for 2 years and $1.6 million before building the factory !
Ummm
as soon as the name bob iger came in and how he was a mentor, its amazing they only lost $40M
Been there done that 32 yrs ago worked hard to make the come back, stayed married, now retired own our house.. best wishes to them both, there will be ups and downs ,just stick with it
I had an health scare about 10 years back, and the last thing I was bothered about was money. All I could think about was will my wife and son be ok without me.
Interesting story. Read up a bit on them. Jackie Cuscuna and Brian Smith say they’ve been fired by the very investors they helped entice to buy back the business,
Smart investors
Very good news! I'm happy for the investors
Buy the things you need with the money you have on hand - if you don’t have the money don’t buy it. Your business may stay small but small and profitable is way better than the alternative.
As someone who has grown a multimillion dollar brand from scratch, in the past 3yrs, stories like this are of continued value. I have had many businesses over the years, but strong momentum can be more deceiving than certain struggle, just due to overconfidence. I am much more slow paced with my scaling, and while investment dollars would likely propel me into 8 figures, that machine size just isnt for me right now. Great story to watch and reinforce my mindset for sure!
Why do people make a success so complicated and complex? Why do all that "expansion" when one could make a big profit and be perfectly content with a single store, or a few?
I’ve never gotten tired of repeating what was told to me when I was 17 (I am 61 now): Sales is vanity, profits are sanity, cash flow is reality.
Much respect to this couple. As an entrepreneur I learned some businesses are not meant to be BIG. Like ice cream shops
I am facing corporate and personal bankruptcy, as we speak. This has been the hardest and most emotionally and mentally damaging past two years of my life, trying to save my company. I have made mistakes, and compounded them by taking more risks and have also been met with many challenges I wanted to believe we could overcome (like our staff forming a union for a two location business, during the pandemic. Then they all left us). But I believe(d) in my company and chose to fight for those fighting for the company. But now I fear that in spite of the best of intentions and efforts, it is for naught, and I am doomed.
To my wife and kids, I am sorry.
I have never been in such a dark place with so much negative self talk. I want to move on, but the prospect of the bankruptcy is so scary. I want to see this through, but continuing to fight with me at the helm is not going to work either. We have a super strong brand and product, but we just can't overcome the challenges/debt we are facing.
@jtcash44 Sounds like you had something that worked enough to grow to have employees. Take note of the wins and the courage to start such a thing and lessons you learned from the things that didn’t work.
For the employees that decided to start a union, listen to the realistic concerns and consider starting again.
Many business winners had many failures before they found success. Entrepreneurs take chances many don’t
@@Regina.Clarke Thank you for your words of encouragement. I really appreciate that you took the time to comment.
How could they underestimate the number of scoop shops to keep the factory operational by such a huge margin. Seems like some math and statistics and a little bit of gut feel would have answered that question that ended up killing the biz.
It's a small mom and pop shop that drank the SF/SV koolaid and went in bed with VC. Basic business principles aren't required as the VC just want to hype it and hope some numpty comes and buys it or they can just write it off; they get their 2/20 regardless. VC is a lucrative job for the partners. Heads getting c*t off if they are held in the same standard as Hedge Funds.
Super interview, thanks for sharing. Sorry you had to go through 10 years of grinding for that to happen but omg to pull back through the otherside is very inspiring. Ppl dont realize how failing forward really makes for successful future, that experience, you can not buy it ❤ Blessings to you both and your business ❤
Good to see that the marriage survived. That is not usually the case. Speaks volumes about their relationship. I wish them the best.
This is one of the best and most instructive of the series. Kudos to these entrepreneurs and the producers for sharing.
I lived 2 blocks away from Ample Hills on St. Marks in Brooklyn. It was a great Ice Cream shop and I like most of the flavors. They even opened one in Astoria, Queens. So sad to see the shops closed and happy to see them re-opened 🙂
Love seeing these honest looks at what it takes to be an entrepreneur!
Once I saw them touting Winfrey and Spielberg I lost any interest in their business or their story.
Wow, as I build my business hearing stories like this is so inspiring. I’m glad they didn’t give up!
love how they didn't stop at an appropriate point to keep demand up and maintain an intimate brand experience, but went the disease route of massive endless capitalistic expansion, which is obviously unfeasible and somehow encoded into our greedy American minds these days.
Also, imho, It's ice cream, they weren't bought by a mega corp like nestle, so the business was doomed the second they expanded out of NYC, or even their original location.
They got to 13 stores total. Their problem was 2-fold-- yes, overexpansion (3 of 13 stores were in Florida & California) but also the factory decision. That was driven by their risky gambit to add that factory before growing to an appropriate size to definitely support it. They probably could have added an additional NYC production shop or two to smooth the transition and limited their expansion vision to Long Island, southern New England, and coastal New Jersey to find a better balance first. Or they could have moved production somewhere along I-87 or I-95, where land and labor definitively cost less.
Right now their decision to focus on profitability is helpful, as that's ultimately what business is about. It's got to generate a profit sometime, so it might as well be early.
Happened to one of the brand at my local place, they grow sooo fast, opening branches one every 2 weeks, they were everywhere serving coffee, cakes, cookies, butter cookies etc. At one time I said Wow they must be doing really good with their financial, there should be tonnes of VCs or banks willing to lend them the money for them to grow faster but I notice something is not right, their shop is not fully crowded, some small entrepreneurs starts to open their own coffee shop serving almost the same things at smaller scale, they didn't make enough ads for people to recognize them (they put banners everywhere, under flyover, traffic stops, billboards, join events to open small booths, flyers distribution to local mall, discounts, coupons, limited time offer etc.) but their menu hasn't changed at all, the price were extremely overprice at some point, they didn't listened to their customer's complaint about some of their menu and didn't make any improvement to the existing menu, they keep opening branches some of them come close to one another like 1-2 miles from each others serving the same things and the shops layout (the design and colors) is not welcoming at all, the staff is not friendly and in some cases were rude to their customers. I would assume that they wont make it in the next 12-18 months if they keep going with this attitude or work ethics, people will eventually hop in to smaller shops which offer a lot more price to value to taste performance.
Are you from England? What city?
not to blast in here being all negative, but it doesnt seem like they really learned their lesson. I think they have a fantastic product, and that alone should be enough for any business to start small, grow organically without any external investment. Otherwise your just an employee to the investors, 100% at their mercy, givign up big $$ cuts of your own profit.
You're right. Unfortunately they were fired by the investor of their comeback. I'm an artist so not very business savvy but even I know that involving investors in my business means that they can fire me, which is just not an option for me as a business owner. If I want to be fired, I'll work a 9-5.
I would have gone back to the ice cream cart, then a small shop, grown that and been at peace with a small shop, just one. No more of this expansion talk. Instead they created a holding company with the investor, gave him all the power and now they're jobless.
@@lisabrightlywhy is that unfortunate? They bankrupted the company twice on purpose and suffered consequences accordingly
this is what happen to my business from covid, built a business to 7 figures, then covid lock downs ruined it.
Whenever you start a business, do it with your own money. Don’t take loans from the market. Stretch your legs only as far as your blanket allows."
Sad news they’ve lost the Social too and the investors kicked them out of that too :(
Don't blame the factory. You were losing $1.6 million a year BEFORE the factory. The factory just amplified poor decision making.
Then, when your sales increased 30% you didn't get any leverage, you lost MORE money.
Keep you overhead low, and try to self finance your expansion.
These are hardworking people. I hope that they can sustain success.
They made stupid decisions why would you build a giant ice cream factory in one of nycs most expensive neighborhoods and then relied on 15 brick and mortar’s no wonder that company didn’t want there help
Because they are idiots. It doesn't have to be more complicated than that
Well done guys for not giving up!! Wish you much success going forward
It's not the size that matters, it's the motions! 😂 You'll be rocking & swaying much more than Ruby driving everywhere. I compare our truck camper to driving an ambulance. We have no sway hauling our 5th wheel.
We cannot wait to see where you go - small!
Great video but no ice cream chain turning over $10m is valued at $40m unless they had a 35% net margin. And even then I don’t see it.
In retrospect they grew too quickly to include out of state. They went out right at the time of Covid, which likely would have been a hindrance to sales for years.
starting one solid shop and then growing it to 1-2 more is the best in my opinion instead of rapid expansion because then you have factors such as overhead, employee retention and management issues as well with rapid expansion but slow and steady growth allows you to see different perspectives and growth opportunities to better manage a business
How about using a copacker untill your sales warnented owning your own factory...
Great story! Business is very hard!
Having owned various types of businesses over the years. I know exactly what it’s like to feel like you’re on top, and then have everything come crashing down.
Crawling out of that is TOUGH
Viral ice cream
Got overexcited no business school and experience
Went over growth spree
Got bankrupt due to lukewarm sales and not enough money to sustain own factory
Got bought by investment fund
Kicked them out
Started another ice cream
This time wiser and slower
Bounced back
Rebought original company
they should at least have done some courses online to learn some business management, financial management theories.
Why would you put production in one of the most heavily taxed, non friendly business states.
I went through a similar experience but I can say that your failures make you stronger & wiser.
Good for them. I'm glad they were able to bounce back.
This icecream story was absolutely great to understand the pros and cons of running a business...
There is more pros in being a business owner than an employee > it's FREEDOM, financial and time. Anything that is worth something takes perseverance and work. Sadly the school system teaches you to go to college, get in debt and get a job = Just Over Broke ❗️
Wonderful story...and it shows they were always in it for the love of it and not the money.
I am rooting for you guys. Ample Hill is my favorite ice cream shop.
I like the attitude of learning from failure and disaster.
unless you were a lender or business who was left out to dry
They didn't learn from their stupid decisions and have now been fired by their new smart investors.
As a loyal viewer of CNBC, I thoroughly enjoyed this couple's story as I am am from the neighborhood in Brooklyn where the first got started. Would definitely love to see more "bounce back stories" like Brian and Jackie's because this information is incredibly valuable to small business owners and entrepreneurs that are trying to scale, but lack this kind of knowledge from behind the scenes.
I ❤ their determination. It takes a lot to come back again after such a failure.
So inspiring for all the creatives out there.
A series we need! We also want to hear more details about ample hill.
Better to be out of some flavors than grow too fast and be out of business...I really admire this couple!
Very interesting business case! Glad they are now back in business and doing well. Hope to visit one of their shops one day!
Slow and steady wins the race. 🎉
Oh man, I remember seeing the shuttered shop in Park Slope and the monthly rent was ASTRONOMICAL. Good for them to try again
No mention of the poor creditors. 40 million dollars is a lot of money.
I just read an article that said that 80% of restaurants close within the first five years of operation.
Its a similar rate for small businesses in general
@@TomNook. 89%
Business Owner here- thank you for sharing your jouney, much appriciated
Fast growth can be a curse. Glad they made it thru
Idk what’s wrong with me but I definitely teared up when they got their business back
they should never have allow oprah winfrey to endorse them . she jinked them with her evil mouth
Ive had their honeycomb ice cream in NYC, delicious 👍🏽
Love a good comeback story
Great story for everyone you don't get many turnarounds like this. really motivation for people who r getting into business and struggling to survive. hats of to both of you Great business people. Godbless the business and the ice creams
Wow! I needed to see this video as I recently closed my travel startup but a little voice keeps telling me to keep going.
I remember this ice cream shop on the west side of Manhattan. They didn't have the simplest of flavors in stock, and the line was a mess trying to figure out how to order in a dark dank giant flea market of a room.
Financial advisory firm should have been hired at the point of expansion by that company.
Volume is for Vanity and Profit is for Prosperity
Use profit for expansion not debt.
Then you will never expand...
Money today is worth more than money in the future. Therefor debt to expand and increase revenue faster makes more sense.
The key is to not fail on your cash flow analysis. Which these folks clearly did with their original factory.
They could have farmed out ice cream making to a factory that had extra capacity, they dreamed big and lost big.
@@Lobos222
That's just luck being able to sell you old business at 1M and but it back at 150K.
I like it when people try again after failure. Hope it works out this time. Failure is to be learned from, it only becomes stupid if you repeat the same mistakes.
Awesome rebound. The rough road is not always bad, it may feel bad for awhile. "You didn't come this far to not go farther"
I now run a successful luxury picnic business in Hawaii because of this channel❤
@Talkwithtina808, oh wow, I hope you are still going strong. 🙂
I have been similar situation with my family business
Most important thing is keeping the marriage alive I think
Now we are in a better shape financially
We are so grateful that my family are remained intact after all those difficult time passed
God bless!
This couple stayed together in bad times. That was important to their recovery.
I really admire these two
This was decent ice cream on Boardwalk in Disney.
They didn’t seem too switched on with finances- to be told that you haven’t got enough money to see it through winter and say ‘What?’ indicates taking the eye off the ball/ some naivety to me as someone who runs a business.
Over expansion was a mistake. Hopefully they will now make a great success of it- great product.
We need more of these kind of stories. More realistic, something a wider audience base can identify with - failing and what comes after.
Very inspiring, thank you to the business owners for being transparent and willing to let us see the good and bad.
Unfortunately the lessons continue because after this feature, they were fired by the new investor
Its perfectly acceptable for us to grow our businesses without outside help, the moment we bring on investors, we are at their mercy and can be terminated. Since I'm not willing to be terminated from my own company, going the investor route isn't for me.
Maybe theres someone who is very business savvy that can speak more on this, I don't have the ability to articulate it all.