⛫ How Bundt Cakes Became a $2B Business

Hope everyone is having a great Sunday out there.

Today’s newsletter gives behind-the-scenes info on the latest episode of Empires, which covers the extraordinary model of Nothing Bundt Cakes.

Before diving in:

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• 7 unit QSR package
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While this episode is only about 25 minutes long, there were many hours put into it:

• Research

• Script writing

• Compiling years of FDD data

• 90-minute interview with a franchisee

• & more

So far, the episode is resonating with well over 20,000 downloads/views across YouTube, Spotify, and Apple.

( Note: This was a narrative episode, which I occasionally do in lieu of the interview format).

Nothing Bundt Cakes has truly been a giant hiding in plain sight, as the original founders built one of the most consistent & steady franchise models of all time.

Dena Tripp and Debbie Shwetz began this business in 1997. According to my guest on the episode - Nick Mindel, who operates 17 locations - they’ve only closed 1 location in the entire history of the brand!

From day one, Nothing Bundt Cakes was positioned around celebrations and occasions, which, whether they knew it or not, was an absolute genius decision.

I dive into why in the episode, but a key detail is that this specifically works because their core product is bundt cakes.

Bundt cakes are a product that have a unique combination of being:

1. Very easy to make

2. Cheap to produce

3. Premium aesthetic

This checks the boxes of simple operations and high gross margins for franchisees, while the 3rd point makes the product a gift that customers can bring to celebrations, anniversaries, graduations, birthdays, holidays, you name it.

And it shows in the economics.

Their average unit volume has been remarkably consistent for nearly a decade and a half. The most recent unit economics data we have show an average unit volume of just under $1.5 million, and average EBITDA of about $316,000.

And yes, that is post royalty and marketing.

Whether you’re a franchisor or franchisee, understanding why concepts do well is critical to your success.

Take a listen or watch, and I hope you enjoy!

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That’s it for today’s newsletter, if you enjoyed it, please forward to anyone else in your network who would benefit or find it interesting!