We Lost A $40M Ice Cream Business - How We're Rebuilding
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- เผยแพร่เมื่อ 29 ก.ย. 2023
- Brian Smith and Jackie Cuscuna's ice cream company, Ample Hills Creamery, was a runaway success. A few years after they launched in Brooklyn, New York, they were endorsed by Oprah Winfrey and opened a shop at Walt Disney World. Then, in 2020, the company declared bankruptcy. Six months later, Smith and Cuscuna filed for personal bankruptcy. Now they're trying again - with new investors and a bevy of lessons learned from failure.
Produced & Shot by: Zach Green
Senior Managing Producer: Eric M. Clark
Editor: Kevin Heinz
Animator: Elham Ataeiazar
Reporter: Ashton Jackson
Additional Footage: Brian Smith and Jackie Cuscuna, Getty Images
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We Lost A $40M Ice Cream Business - How We're Rebuilding
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
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
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 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.
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?
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 🤣
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.
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.
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
I like the attitude of learning from failure and disaster.
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!
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.
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 ❤
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.
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.
Thanks for this! I’m still suffering from the loss of losing my business in 2020… I haven’t bounced back this good… yet
This is beyond amazing. Success has no shortcuts, there’re ways to attain it.
Most successful people always seek the knowledge and ldeas of finance professionaIs to help them create wealth and claim to attain their success without any help
To create wealth, proficiency is needed. I indulge in special packages with the Ideas of my finance professionaI and so far I’ve attain so much returns (amount is confidentiaI)
It’s amazing to be here, this sort of idea is a rare one. I want to partake in this. can you give more detaiIs. ?
IsabeIIe ChIoe Scott is my professionaI, I found her on Bloomberg where she was featured, I looked up her name on the internet. FortunateIy I came across her and reached out to her, you can verify her yourself.
I got her page immediately I researched, I read through it and seems pretty interesting, I just reached out to her
This is one of the best and most instructive of the series. Kudos to these entrepreneurs and the producers for sharing.
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.
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.
Wow, as I build my business hearing stories like this is so inspiring. I’m glad they didn’t give up!
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 🙂
Well done guys for not giving up!! Wish you much success going forward
Private equity is a double edge sword. Watch your back.
So they mismanaged a 40 million dollar business down to the ground, declared bankruptcy, defaulted on all their debts, and now they're at it again? And they probably get tax breaks for their losses? Ridiculous
For real 😂😂😂😂
Probably got a pile of PPP loan money from us taxpayers too. Never had to pay it back.
This is the real American dream that many people failed to understand. It's not about doing a job, but running a business and earn millions within a short amount of time. This can only be done in larger countries like US, China, India.
Hate the game, bro.
@@mithall4198Facts 😂
So inspiring for all the creatives out there.
A series we need! We also want to hear more details about ample hill.
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.
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!
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
Love seeing these honest looks at what it takes to be an entrepreneur!
So many lessons. Thank you for sharing!! 🙏🏾
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,
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.
This is inspiring. So much lessons to learn
Business Owner here- thank you for sharing your jouney, much appriciated
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?
Bravo to them! Thank you so much for sharing this. 🙌🙌🙌
Wonderful story...and it shows they were always in it for the love of it and not the money.
Very interesting business case! Glad they are now back in business and doing well. Hope to visit one of their shops one day!
I ❤ their determination. It takes a lot to come back again after such a failure.
Oh man, I remember seeing the shuttered shop in Park Slope and the monthly rent was ASTRONOMICAL. Good for them to try again
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.
Very inspiring, thanks for sharing the story.
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 am rooting for you guys. Ample Hill is my favorite ice cream shop.
THANK YOU FOR SHARING ,,, LEARNED MORE STUFF TODAY.
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.
Good for them. I'm glad they were able to bounce back.
Lovely story glad they shared it
This was inspiring. So happy for them.
I absolutely miss ample hills! Please come back to LB, ca
These are hardworking people. I hope that they can sustain success.
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 ❗️
Such an amazing, inspiring story!!
Love a good comeback story
Slow and steady wins the race. 🎉
Can you tell me what was the course name Jackie took at the BCC for business owners who have to pivot?
as soon as the name bob iger came in and how he was a mentor, its amazing they only lost $40M
We love the story.
Thanks CNBC team for sharing this.
So inspiring! I feel this is the true American spirit of bouncing back and approaching ‘failure’ the right way. Thanks for sharing this ❤🍦
Such a beautiful ending to a wonderful story.
What an inspirational story - kudos to this lovely couple!
Loved how it came full circle!!!! Commenting so more people see this!! 😍
What a fantastic episode!
can you please cover these types of failure stories too. Very helpful.
Great story and advice!
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.
Wow! Inspiring!
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
I needed, thank you
I really admire these two
The best story ever. So inspirational! I'm 10 years in my business now as well going through some rough spots, before being a lot bigger than I'm now (pandemics). But I keep grinding every day.
I think these people were fired 3 months later because they did not have the investment in the company, nor the contractual aspects to prevent them being fired. Basically their "angel" investor and he partners took everything.
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.
Such a teachable lesson!
Wow I went through the same thing had a small hobby business there comes a point when you are too small and at the same time you are too big the cost of the equipment and finding young people to work is very difficult. At the end it was not a hobby anymore. Awesome story!
Definitely more of these stories
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%
Thanks for sharing your story! Failure isn't the end and success is always right around the corner. Excited to try your ice cream sometime!!
Fast growth can be a curse. Glad they made it thru
Good story from the recovery angle....
Keep an eye on return on assets..... asset velocity is a main secret to liquidity in business.
A small asset/sized business could be more profitable than a bigger sized.
Profitability must be well thought through before choosing size, be it a small biz or big sized enterprise.
Different sizes and assets demand different needs which include appropriate staffing, process, demand for the product and contingencies.
More power to you.
Selling online could’ve been the saving grace. Physical locations are really tough with the overhead and rent.
Wow! I needed to see this video as I recently closed my travel startup but a little voice keeps telling me to keep going.
Good that you got on your feet. I'm a up coming business owner in a international bakery .this really help me to get a more prospective of my business thankyou.
Glad to see a company I have had experience with right here in Brooklyn.
Lessons Learned, Wisdom level +10
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.
Good to see that the marriage survived. That is not usually the case. Speaks volumes about their relationship. I wish them the best.
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!
Much respect to this couple. As an entrepreneur I learned some businesses are not meant to be BIG. Like ice cream shops
Great story Next time I pass by one of the shops I'll stop and try some of their product
I only tried their ice cream a couple of times when visiting N.Y., it was great
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.
CNBC Make It and Icecream. Name a more iconic pair.
Wow life lesson learned
Congratulations to this couple!
This is valuable story Kindly make story for business like this