How Sweet It Is . . .

The captivating tale of how Danna and Adam Caldwell turned one small Valley Village store into a rapidly growing chain and why they call their business “a love story.”

Danna Caldwell has always had a major sweet tooth. Adam Caldwell grew up loving a frozen yogurt shop in the OC. Looking back, the co-founders of Menchie’s think its kind of ironic that they had their first date at a yogurt store.

To hear 33-year-old Danna tell it, the experience was totally underwhelming. Not Adam, mind you, but the yogurt shop. Sure, it offered visitors (what was then) a unique self-serve experience. But that aside, not even Adam can remember the name of the place. And the fact that their romance was able to ignite under the shop’s drab fluorescent lighting just goes to show
that when it’s meant to be, it’s meant to be.

The year was 2004, and shortly after that first date, the couple got inspired to own a self-serve shop and began devising a plan. “Back then, there wasn’t a place where you could get your own yogurt and your own toppings. Personally, I like lots of toppings. I thought, why not let people just get what they want and pay by the weight instead of the number of toppings?”

“The funny thing is,” quips Danna, “we had a business plan before we even got engaged.” But kicking   off Menchie’s proved to be far from easy. After applying to 35 banks for a small business loan and “getting turned down by most,” the couple finally got backing. It was also a challenge finding a landlord who was willing to take a chance on two “kids” who’d never owned a business.

The first Menchie’s opened on Laurel Canyon in Valley Village in 2007. “We liked the sense of community there,” Danna explains. It was just 12 days before the couple’s wedding. “Menchie,” in case you’re wondering, is Adam’s nickname for Danna.

“We spent all our time in this store,” Danna shares, making herself at home behind the counter on a hot, fall day. “I worked the front. Adam worked in the back.”  Two months after opening, a baby was on the way.

 

Their talents are different yet complementary. As chief financial officer of Menchie’s, Adam had experience in the restaurant industry, having helped to expand several successful chains. Danna, a Kansas City native, brought her marketing background to the equation. Danna is more of an extrovert, while Adam prefers working behind the scenes.

Danna’s last job before founding Menchie’s was at a now-defunct marketing firm. “I was fired, actually. The person I was working under didn’t like me,” the raven-haired, fair-skinned entrepreneur laughs, “but it’s a classic example of how from the toughest experiences can come the best experiences. Because I was let go, building Menchie’s became my full-time focus.”

“Customers started asking for franchises within months of the Valley Village opening. Franchising? At the time, that was like a foreign word!”

Expanding from one store to a chain turned out to be somewhat organic. “Customers started asking for franchises within months of the Valley Village opening.  Franchising? At the time, that was like a foreign word!” Danna chuckles.

But before the couple knew it, the first franchise opened in Hawaii. Several others quickly followed. The Caldwells knew that sustainable growth would require bringing on remarkable talent. Enter Amit Kleinberger.

“We call him our Ray Croc,” Danna chuckles. As CEO of Menchie’s, Amit is in charge of the company’s strategic vision, overseeing the business’ development as he guides a vast team of employees who “get” the mission. He met Danna and Adam through mutual friends and shares the couple’s belief in the importance of building long-term relationships, family, health and education.

Before coming on board, Amit had owned businesses in different arenas as cell phone equipment, glazing and glass distribution, and assisted living. He had also served in Israel’s armed forces, and it was there, he says, that he learned one of his greatest lessons. “I learned that people aren’t primarily driven by a paycheck or the orders they’re given. They need a culture —one in which they can have fun, evolve, and grow.” Recognition of this fact is the foundation for the company’s success.

 

With 232 stores, including ones in Australia and Japan, Menchie’s is now independently financed and debt-free. The company’s website states they are projecting to exceed $1 billion in sales within the next 20 years.

The big challenge for companies, according to Amit, is making sure they have a unique product. “But we’ve unlocked the DNA. Our stores and brand are unique,” he says. “They appeal to families.”

In addition to great-tasting, high-quality frozen yogurt and toppings, every Menchie’s has a chalkboard upon which parents and kids can take a moment to create art together like they might do at home. In today’s technologically-driven world, Amit points out, people still yearn for such simple pleasures.

All Menchie’s locations are also designed to accommodate parties. “The industry is growing fast, but if every guest leaves with a smile, we’re successful,” Amit states.

So how do you ensure that every guest leaves with a smile? You train your franchisees to make sure they do. That’s where Menchie’s University comes in.

Located in a small, non-descript building next to a bank in Encino, franchisees come from all over the world to attend a two-week course. They watch videos and listen to presentations in a 60-seat auditorium and then head to the Encino branch for in-store training.

Ask Danna if her life has changed much since they began Menchie’s, and she’ll quickly tell you it has. For starters, the Caldwell family has grown; the couple now has four children including three month old twins.

They also recently bought a new house in Valley Village, just a few blocks from their first store. “But we’re still down-to-earth; we still go down to our Valley Village store to meet and hang out with customers.”

And life continues to happen at Menchie’s. According to Danna, “Menchie’s is a place where people meet up with their friends, and kids stop by after school or after they’ve gone to the doctor.”

She even knows of a couple that decided to get married at a Menchie’s because it played a special role in  their relationship. “One kid put a note in the bottom of his date’s yogurt cup, asking her to be his girlfriend. People feel good when they come here, and it’s because the business was born out of love. I think that is one reason it is so successful.”

MENCHIE'S BY THE NUMBERS

8         Toppings Danna likes on her fro-yo

45       Maximum “Snackage” toppings available at stores

16       Yogurt flavors on tap in each store

200k    Pounds of gummy bears consumed annually

41¢      Price of yogurt per ounce

84k      Average cups of fro-yo sold per day worldwide

$365k  Cost to own a franchis

3         Maximum number of grams of fat in each serving

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