“Cupcakes are girly,” he said. He loved them, but did other men? Could Detroit’s shattered economy support a high-end cupcake business? Todd, formerly the COO of a shirt--manufacturing company but at that time unemployed, was dubious, so Pam shelved the idea. Then the marketing company she worked for asked her to relocate to Florida. To stave off the anxiety she felt about moving, she started baking cupcakes. Every tray she set out for her family disappeared in minutes. Soon she had a brisk side business selling to friends. After a batch found its way to a group of federal judges in Detroit—all of whom wanted to know where they could buy more—Todd reconsidered: The city was ready for cupcakes after all.
In January 2009, using their entire retirement fund of $100,000, they launched Just Baked (justbakedshop.com) out of a rented commercial kitchen, selling wholesale to gourmet shops and small markets. Todd did most of the baking so Pam could keep her job and benefits. Three weeks into their venture, after mistakenly baking 50 cupcakes too many, the couple figured they’d try to sell them to passersby. They found a dusty neon open sign and hung it over the entrance to the kitchen, and by the end of the day they’d sold every cupcake for $1.75 each. They decided to stick with the open sign. That month they broke even. The following month they grossed $16,970, and Pam quit her job.
“Owning a cupcake business elevated us to rock-star status among our kids’ friends,” says Pam. “But in the beginning, we disagreed on how to grow the business. The stress on our relationship was huge. Todd wanted to buy equipment. I wanted to add staff.” The 18-hour days didn’t help. But gradually the couple came to recognize each other’s strengths: Pam is “a brilliant marketer,” says Todd, and she’s good at managing the employees. He’s the logistics expert and took charge of their expansion. The couple now has 10 stores, including three franchises. The business grossed about $2.5 million in 2011, but what thrills them most is that they created 75 new jobs for people in the Detroit area. “We both grew up here,” says Pam. “We chose to stay. I have friends who had big jobs who aren’t working now. But I have pride in this city. We’re part of Detroit’s turnaround.”
The Driving-School Innovators
In 2008, Laura Shuler, then president of the New York City–based marketing firm Jack Morton Worldwide, came upon some statistics that appalled her: On average, one in every three teenagers will be in a car accident in the first year of driving; about 6,000 teens ages 16 to 20 die annually in car accidents.
With a stepson nearly old enough for driver’s education and vivid memories of two friends killed in car crashes when she was young, Laura had a personal interest in the subject. She also knew a good business opportunity when she saw one. She brought it up one evening with her husband, Steve Mochel, an account executive at her company. “Did you know driver’s ed hasn’t changed at all since the 1950s?” she asked him. “We should start a driving school. We could modernize driver’s ed.”
“I don’t think so,” he said. “Too seedy.”
Eight months later, Steve was laid off. Laura, unwilling to participate in the firing of hundreds more employees, quit the firm. Her stepson, Steve’s oldest child, had just attended his first driver’s-ed class, and after hearing his account, Steve changed his mind.
The couple created a cutting-edge curriculum that includes the use of computer simulators designed by the same company that makes training simulators for the military. With $250,000 of their savings, Laura and Steve launched Fresh Green Light (freshgreenlight.com) in November 2009. The couple now has 14 employees; offices in Rye, New York, and Greenwich, Connecticut; and a computer simulator at each location.