The Chocolate Life

Discover Chocolate and Live La Vida Cocoa!

We're getting ready to sign the lease (we hope) in the next week or so for an 1860 square foot space in a tiny little business/industrial park in the San Francisco Bay Area that we hope to transform over the course of the next couple of years into a successful fine chocolate (bean-to-bar) and artisan confection business. 

Clay suggested the idea of starting a discussion thread here on Start-up Central as a way of sharing what we learn along the way with others either already involved in their own start-up or still contemplating jumping in. We really liked the idea -- it fits well with our commitment to always 'paying it forward' in life, and with the idea of one hand up, one hand down (one hand reaching up to accept the help/wisdom of others who have something to offer/share and one hand reaching down offering help/wisdom to those with whom we have somethign to offer/share). We'll share what goes right, we'll share what goes wrong -- open source, nothing held back or edited. We welcome your thoughts, questions and suggestions along the way.

Snapshot of where we are today:

- Custom molds are paid for (~$8k), but on hold until our trademark registration is approved (wouldn't be much fun to have molds that we can't use...). Hope to be cleared to move forward by January.

- $1400 trademark search with Thomson Compumark completed. The attorney has reviewed it and is now in the process of filing the registrations (another $1k +/-)

- We're a newly formed S-corp. (Total legal fees to date, including the above ~$4.5k)

- We've designed our packaging, but won't order it until our trademark clears.

- Leslie is going to be full-time, I'll be part-time (mainly on weekends) since I have a day job that (a) I like, and (b) will let us support/sustain the chocolate business through its first couple of years. We'll hire help as soon as the work load dictates.

- We subscribe to the Lean Start-up approach -- an iterative build, measure, learn process; pivot (change direction) when needed, etc. and to the idea (as articulated many times by Brad Churchill in his posts on this site) that making a profit isn't a 'nice-to-have', it is a 'MUST have'.

- Oh yeah, we make a pretty decent bean-to-bar chocolate. At least WE think so. And so do some (possibly biased) friends, family and co-workers. But we all think our own kids are cute, so just to be sure we're not kidding ourselves about where we really are, we're sending bars out this week for formal 3rd party evaluation (~$1k)

- We plan to spend a good part of the first year perfecting our systems. We're not going to scale to any kind of volume until we've worked the kinks out and are capable of delivering a consistently excellent (and profitable) experience to our customers.

- For manufacturing flexibility and resiliancy we plan on using multiple small scale pieces of equipment rather than single larger volume pieces.

- We know that we don't know what we don't know. We plan to contract with Clay for consulting services, both on the plant layout and on the business side.

- We're utilizing SCORE resources to learn more about the accouting, insurance, legal, and sales and marketing sides of the business, and to make contacts.

There's more, but you get the general idea...

Next major milestone for us is seeing if the landlord will accept our proposed lease addendum and mark-ups. That will be our next post...

Best,

David and Leslie

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Replies to This Discussion

Good news. I had to stay an extra.10 days in the DR to get some liquor to start molding the drinking chocolate. The WCF meeting was fantastic. Learned an awful lot and met people I need to met. Spent the day in the community I was originally sent to by Peace Corps. There is another volunteer living there working with the women's cooperative who make chocolate and we had a great deal to talk about. We are going to paint her house this week. Monday to the Capital to see if I can resolver el problema de liquor. It will be fun to tell that story when I can. Not a lot of cacao on the trees right now, but the next harvest is soon. Probably only 20% of the year harvest comes at this time. Adios

Sounds like a lot of fun -- would love to join you down there someday on a future trip. Would also love to try some of your DR chocolate once you get everything worked out and start making bars. Kudos on the volunteer work. You've got a great story in the making -- we wish you all the best with it and are enjoying following and being a part of your journey...

Best,
David

Good luck guys. You think the headache is buildout when really its just the inception to a long long long off-road  journey. :) The point of this game is to test just how far over the barrel you want to go, then will go, then actually can go.

Does that mean I need to change the title of this discussion to 'Shared Long, Long, Long Off-road Journey'?

; )

 

Thanks for the good luck wishes -- we're probably going to need some of that along the way. We're in this for the long haul (at least we certainly  hope we  are). It's really nice getting some perspective and the occasional sanity (or insanity) check from others on The Chocolate Life who have already travelled the road we're just starting down...

 

 

We have a building!!!!!

: )

Congratulations on signing your lease David

I too am enjoying your posts in this forum - we have been working towards getting our bean-to-bar business operational since we had the idea back in 2005! Oh well - sometime life gets in the way of a good idea.

We have most of the equipment and are close to finishing off the small factory, so at a similar stage to you - as I said, great to be sharing the journey with others.

Keep up the good work!

Regards

Rik

Maloko Chocolate Co - roaster of South Pacific cocoa

Auckland, New Zealand

"Life" is kind of funny that way...as John Lennon said, "Life is what happens while you are busy making other plans".

We just spent a weekend with relatives we hadn't seen in over 20 years a couple of weekends ago, and one of the things that came up was how much we all would like to see New Zealand while we are all still part of the here and now (as opposed to the great hereafter), and we set a date of 2018 for our pilgrimage. Let us know where your shop is at and then plan on visitors (in five years)!

 

All Our Best,

David and Leslie

 

Areté Fine Chocolate and Artisan Confections ...has a home!

 

The lease is signed, the keys are ours, and we have twenty-seven months now to go from a standing start to proof that we’ve been able to develop, evolve and implement a viable, profitable business model. There are so many moving parts – it’s really an amazing experience – and we’ve only just begun the journey.

 

This week, in addition to completing the final review and signing the lease, we also filed our last trademark registrations (we’re told to expect to wait three to four months for an answer). We also got into the space, took measurements and put together a floor plan to start working from. We’re going to work with Clay on the physical layout (in addition to other general business issues) to make sure we get it right, or at least as close to that ideal as possible, from the beginning.

 

Leslie went to visit the city of Milpitas this week to find out what permits we need and how we get started. What we were told is that we need to submit two copies of our plans for the facility – one to them (the city) and another to the health department – for approval before we can do anything. They also (strongly) advised us to use an architect to do the drawings. Apparently DIY on this part is synonymous with “delays”. Needless to say, job one in the coming week is to find an architect. We really can’t DO anything with the architect just yet (we’ll need the proposed layout for that), but we do need to at least figure out who we’re going to work with and find out how they do business.

 

After reading the admonishments in other discussion threads, and in recognition of the fact that neither one of us is a poet, we’re heeding the wisdom of those who have gone before us and (re-)engaging with a design house we started working with earlier in the year on packaging concepts. They aren’t cheap but they do some really exceptional work. We’re leaning very heavily toward having them do our marketing copy, our website, package copy…the works. We’ll stick to making chocolate and selling it.

 

Taking a brief moment to pause and reflect, several things have already become quite evident as we’ve made our way to this humble first milestone: things seem to always take a LOT longer, and they seem to cost quite a bit more than what we first thought they would. Not really a surprise – we built that into our plans right up front (unknown unknowns, and contingencies). What has been a surprise is the magnitude of the difference. While not ideal, in some ways these inevitable timeline delays are a blessing as they’re giving us more time to plan, develop our business plan, test our ideas…and breathe. Our costs, even with the building and the occasional ‘surprises’, are reasonably low and we can support the expenses for the duration of the lease with or without sales (that’s not the plan…don’t get us wrong…just noting that it won’t shut us down). On the upside, we’ve been amazed at the generosity, kindness, patience and support of the people we’ve had the pleasure of getting to know along the way in our still-young, but already incredible journey – not the least among them, the many members of The Chocolate Life.

 

Things may move a little slower yet for the next couple of weeks on the business front – Leslie’s heading back to TN for a couple of weeks to welcome our first two grandkids into the world. Yep, her daughter is having twins(!). D-day (delivery day) is sometime between right now and a week from Tuesday. I hope to join her there for at least a couple of days shortly after the grand event providing my schedule cooperates. Given the choice between giving birth to a chocolate shop or giving birth to twins, personally…I’ll think Leslie and I have it easier!

 

Excited (on multiple fronts!) in Milpitas, CA,

David and Leslie

Thank you again. Your information is extremely helpful as we will also be dealing with the same issues in the near future. You sure give me a lot to think about. I am still in the Dominican Republic and will be flying back Thursday. We will pick up 600 kilos of licor and 90 kilos of butter on Tuesday at CONACADO and drive it to the airport in SD. It will get there same day and I will pull it out the morning after I arrive. I have also been talking with and have done repeated visits to the three rural women associations I am working with. Picked up 8 lbs of "balls" of gritty paste from the group in Loma de Jaya, 10 lbs from Los Naranjos, and the group in Vincentillo sent me 50 lbs of paste in little balls and a gallon of refined licor to sample. The person who makes chocolate making equipment locally was there and brought it from Hato Mayor to San Francisci de Maroris.

Right now iam sitting on the front porch of my nephew's friend in Jaya using an IPad which I am just starting to use. He works for the local television station and has manipulated the cable signal to have wifi. It is the only connection outside of SFM. Usually I have to take a 20 minute motorcycle ride into SFM to connect.

Last night I went.to a fiesta in Naranjo Dulce which is about 20 minutes up a connecting mountain road. At least 200 people and all are cacao farmers. Boy do they know how to party. I really can not dance bachata but last night I was the closest I have ever been to getting there. My wife, Marisol, would be proud of me and I hope not jealous. They all know her family so I always have to be on my best behavior whe I am in the campo.

Yesterday I took a couple of friends to Los Naranjos to paint the house of a Peace Corps volunteer who is working with the women to try to get there chocolate making activities go somewhere. They have the capacity to make a good product and their cacao wine is pretty good. They need some business management and a sales plan which I will be working on getting accomplished. I have known these women for 26 years and it appears to be the right time for me to jump in head first.

I will be sharing some photos when I can. I am having a fantastic time and want to just stay if I could. I have also visited my friends at the Sendero de Cacao of the Rizek's, visited a processing plant in Tamboril and more than to share whe I have the time

Looking forward to the photos -- can't wait to see what you've been up to. Congratulations and kudos on your work with the women's associations and your volunteer work. Are you planning on being an outlet for their liquor and other finished and semi-finished products, or are you mainly helping them with the business side of their operations? Sounds like an amazing adventure and a great opportunity either way. We're really enjoying following your journey -- very different from ours, yet all roads seem to lead back one way or the other to fine chocolate in one (delightful) form or another...

David, I love the name!

Congrats on getting the space leased. Huge step right there.

Thanks, Kane -- you know we've been talking about doing this for quite a while now. It's a huge step for us from where we started just a few short years ago. We're going to do everything we can to make a go of this -- it's our 'second act' -- our second half of life. We've worked in the corporate world for over 30 years (an still are), and have been largely on the receiving end of life to this point. This great chocolate adventure is our chance to do something on our own and to use it as a (very fun) vehicle for giving back and paying it forward in the second half. We plan on being active with our farmers and their communities, with our local community -- especially when it involves education, health and/or the environment.

 

Yell if you're in the neighborhood and we'll show you around our new (and empty!) space...

 

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