By Evan Hoopfer – Staff Writer, Dallas Business Journal
When deciding what to name her business, Kate Weiser studied her chocolate heroes.
That’s the name she has for the chocolatiers she looks up to. Many name their businesses after themselves, which creates a sense of the mystic and respect for the chef.
“They’re all guys. I was like, ‘Why aren’t we doing it?’” said Weiser, who named her establishment Kate Weiser Chocolate. “I just wanted to be in with the cool kids.”
When Weiser opened her shop at Trinity Groves in 2014, she had no experience running a business. Her expertise was in making chocolate.
She made plenty of business mistakes — a digital marketing campaign fell flat and erased a whole quarter’s profits, for instance — but her acumen has grown to the point where the company had $3 million in sales last year and caught the eye of some of the most powerful influencers in the country. And she remains heavily involved in the day-to-day production and is constantly testing new recipes.
“She had to learn hiring, firing, staffing, inventory, logistics, manufacturing logistics,” said Stuart Fitts, Trinity Groves co-founder and managing partner and part of the original team that invested in Weiser. “She is a CEO, but she’s also the chief design and creative officer.”
Weiser remembers sitting in her college dorm after her freshman year scouring a list of potential majors. None sounded appealing. She then called her parents to let them know she was dropping out of college — opting, instead, to attend culinary school.
After graduating from the California Culinary Academy, she made pastries for restaurants in Kansas City and Dallas while working side jobs. One of those part-time jobs was making chocolate. While Weiser grew up tinkering with recipes and specialized in pastry while at culinary school, chocolate-making presented new challenges.
“Chocolate is so different from pastry,” Weiser said. “I really didn’t know what I was doing, and I made terrible chocolate for the longest time. But it lit this challenge of, ‘What am I doing wrong?’”
She eventually got the basics down, and then started emulating a technique a chocolatier in her hometown of Kansas City used to make the chocolate look like a hand-painted work of art.
Eventually, an idea of going out on her own grew stronger.
Weiser walked into a meeting with local developers Phil Romano and Fitts with the goal of receiving funding to open a chocolate shop.
Much to her surprise, that’s exactly what happened.
“I never thought that they would right then and there say, ‘OK, we want you. We want to sign you up. We’ll give you $500,000,’” Weiser said. “I never thought those things would happen. I never thought past the meeting.”
Growth of fine chocolate
Kate Weiser Chocolate sells delicate pieces of chocolate called bonbons that range in flavors from almond caramel to strawberry basil to buttery popcorn. She stuck with the hand-painted look and the company’s tagline is “Where art meets chocolate.”
Since her store at Trinity Groves opened, Weiser added locations at NorthPark Center and the Shops at Clearfork.
E-commerce sales have also risen. When the business first started, Weiser used her website more as an informational resource. After the first year, the website added purchasing capabilities, but was still restricted from shipping during the hot Texas summers.
That was until last year, when the company decided to test summer shipping just to see what would happen.
“We shipped from 100° Dallas to 110° Arizona, and we made it work,” Weiser said.
E-commerce accounts for 15 to 18 percent of sales, Weiser said, and has the most potential for growth.
If industry trends continue, customers will start buying more chocolate from places like Kate Weiser Chocolate.
Demand for fine chocolate — defined as having a limited number of ingredients, high in cocoa content, low in sugar content and a care to where ingredients are sourced — is small but growing, said Bill Guyton, executive director of the Fine Chocolate Industry Association.
About 5 percent of the market is made up of fine chocolate makers, Guyton said. Growth in the number of fine chocolate makers and their market share is expected to rise as the industry mirrors other sectors of food and beverage.
“If you look at what’s happened in some of the other craft or specialty industries like in coffee or craft beer, you’ve really seen over time that consumers are beginning to appreciate more the higher end foods that they eat,” Guyton said.
The Oprah effect
One of Kate Weiser Chocolate’s most in-demand products is a snowman named Carl.
Once Carl is dropped in warm milk, he dissolves and hot chocolate is created. Weiser thought ironically naming an intricate, labor-intensive creation something simple like Carl “was so dumb,” Weiser laughed. “That’s why I liked it.”
Last June, a representative from an influential celebrity reached out to Weiser and asked for samples of Carl.
Weiser asked if this was for “Oprah’s Favorite Things” — and it was.
She became worried whether her team could make enough Carls to meet the demand that would come if they actually landed on the annual list. After all, Carl is made by hand.
Small businesses thrust into a global spotlight like this are put under an enormous amount of strain.
For instance, Abe Minkara, the business development director for Mark Cuban Companies, says that getting businesses ready for the onslaught when they appear on “Shark Tank” is crucial.
Apart from the obvious things like strengthening the website's ability to handle the uptick in online traffic, Minkara advises his portfolio companies to be transparent with customers about shipping times.
If the company runs out of product, for example, customers should be aware their shipment will be delayed a few weeks.
"Once you set that expectation, a lot of customers will go ahead and order even though you don't have the product on hand," Minkara said. "The challenge is to maintain constant communication with the customer throughout that period."
Weiser took no chances with Oprah Winfrey. Her team started making extra Carls in June when there was only a chance they’d make the list. Weiser’s preparation paid off when the company found out in late September Carl would be on the list.
The year prior, the company made 6,000 Carls. In 2018, it made 38,000. November year-over-year sales tripled and in December more than doubled. The company employed 98 people during that time to pump out enough Carls, much more than its usual 30.
“The Oprah effect is real,” Weiser said. “I’m glad I’m through it. I’m glad it’s over, to be honest.”
Weiser feels like she’s at a plateau right now.
To take the next step, the company needs a big investment to add a warehouse and production facility that can significantly increase output. Production automation, like for certain aspects of Carl, could be vital additions to grow the brand’s volume and lower costs.
“He’s all done by hand,” Weiser said of Carl. “And once you make more than 10,000, the efficiency completely dies and you make no money.”
You can’t buy the type of machinery Weiser needs off the shelf. It’s usually bespoke and comes with a hefty price tag. Fitts estimated the company will need between $600,000 and $700,000 to buy new equipment and has already started raising funds for a new production facility.
Weiser is unsure where her company will be in the coming years. She wants the company to evolve naturally and help push it in the direction it’s already going. She’ll try anything once.
“Any opportunities that come that make me feel uncomfortable, I go for it,” Weiser said. “I automatically say, ‘That’s scary as (expletive). Let’s do it. Let’s try it.’”
Founder of Kate Weiser Chocolate
- When you were a kid, what'd you want to be when you grew up? Pastry Chef
- Quote you live by? "How you do anything is how you should do everything."
- Favorite bonbon flavor? Passion Fruit