Franchising Will Make the (Cookie) Dough

Two hours into their first Nashville event, the line still hadn’t died. That moment convinced Jimmy Feeman to go all-in with his co-founder and wife, Megan, on a wild idea: build a dessert brand from scratch and figure out the financing on the fly. What followed was a raw, unfiltered journey—from maxed 0% APR credit cards and DIY build-outs to packed scoop shops, an SBA Express loan, a pandemic pivot to DTC, and a hard-won return to franchising with a smarter capital stack.

We walk through the decisions that moved the needle and the ones that cost time and money. Jimmy breaks down unit economics at the jar level, why franchising can be a financing strategy, and how to use debt for inventory and equipment while reserving equity for marketing and R&D. He shares the reality of CPG cash cycles—terms, invoice factoring, PO financing, slotting fees, and deductions—and why growing only as fast as your customers fund you can be the most sustainable path. We also get candid about the vendor traps, misaligned incentives, and the absence of mentorship that made early wins harder than they needed to be.

Underneath the numbers is a playbook built on communication and resilience. Jimmy explains how a shared operating rhythm with his co-founder kept decisions clean, roles clear, and momentum steady—even when shutting stores, litigating leases, and rebuilding channels from zero. Now, with a proven scoop shop model, a refined franchise process, and SBA-ready candidates, the team is scaling slowly and intentionally, matching capital to its best use and protecting cash along the way.

If you’re a founder weighing franchising vs. CPG, wrestling with CAC, or wondering how to assemble a real capital stack, this conversation will sharpen your plan. Subscribe, share this with a builder who needs it, and leave a review with your biggest financing lesson—we’ll feature our favorites next week.

Connect with Keith on LinkedIn - https://www.linkedin.com/in/keithkohler1/

Transcript

Meet Jimmy And The NoBaked Origin

Keith Kohler 0:03

Hi everyone, welcome to episode number nine of How I Financed It. And glad you're joining us today, both our viewers and our listeners, for this edition of How I Financed It. By way of background, again, I'm Keith Kohler, your financing man, and I help customers get the right financing at the right time. That's Transaction Me. And then I also meet my customers where they are and guide them along their financing journey. That's transformation me. So transaction plus transformation equals financing man. And what we do here on how I financed it is we take a look at the journey, the entrepreneur journey, primarily through the lens of finance and financing. And then we see where the discussion goes. So just exploring any tangent or any bit of energy that comes up and that makes sense going after. So really happy today to have today's special guest, Jimmy Feeman from No Bait. Uh, and I'd love to welcome him to the How I Financed It Stage.

Jimmy Feeman 1:14

I'm good. I liked it. It was it gets you excited.

Keith Kohler 1:18

Yeah, it's clever. You know, it's a funny thing. I'm very blessed to have an amazing production company and then artists who support me and doing graphics, and that animation was done by another vendor, it was perfect. So thanks for that. Love it. So, Jimmy, jumping right in, um, what we're gonna do today is talk a bit about no baked and how that got started. So, why don't we start just with that? What was uh what were some of the elements of the origin story about how you got interested in establishing No Baked?

Jimmy Feeman 1:47

Yeah, so I'll I'll turn the clock back almost nine years ago. Um back in uh March of 2017, um, really February of 2017, Megan had gotten a job at Sony Music. And Megan, for those of you who don't know, is my co-founder and wife. Uh, we had both been job hopping a lot. We'd been out of college for about a year. Um, and she hated her job. She hated it. She got that job, and then she was like, This job sucks. Like, I do not like it, I do not want to be here. And so she made this uh edible cookie dough recipe for our friends. She'd been making it for a few years. Um, figured there were some other people out there just like her, and she just started building a website, um, doing research on like how to package it up and ship it to people, and launched it uh March 30th of 2017, uh, with some micro influencers and some samples, and I think she got like 12 orders, and then she walked out of her job. And uh at the time we were dating, and I I had encouraged her to like do it. I was like, I mean, this is great, you don't make a lot of money at Sony. I was she was making like what I would call like Chipotle money, like they weren't she could have gone and worked at Chipotle and made more. Um, it wasn't like she was walking away from something that was that big of a deal, but in her mind, it kind of was. The music industry is small, you know. Once she quit, she can't really can't really come back. Um, and so she started out on a new journey, uh, put a lot of fear aside, just went for it. I mean, we were both 23, so we were both very young. I don't think you have a lot to fear when you are young. Instead, you're very naive, which is kind of a good thing. It's super powerful.

Keith Kohler 3:25

I think it's a great thing, yeah.

Hating Jobs And Finding Autonomy

Jimmy Feeman 3:27

Yeah, it is a good thing, and then uh I joined her. I remember I I went so the way that I got involved is about well, I mean, I got involved immediately because she roped me into helping her like put coolers in the car and stuff like that. We went to an event in April. Um, it's by at Centennial Park in Nashville. They have a spring bash, and I remember there was a line outside of the tent, people buying cookie dough from us that was coming out of a cooler that we had made in the kitchen. Um, and that line lasted the two hours that the event lasted, and then the event was shut down by a thunderstorm, and I was sold. I was like, this is crazy, but like I believe, and for the longest time I had seen myself working at a startup. Um, I had gone through a very weird arc after school where I worked at a startup while I was in school. I left that startup because I was sick of being broke. I got a job in finance that made a lot more money. I hated that job, left that job for a startup. That startup failed, and then I ended up at the Department of Treasury at Tennessee, at Tennessee's Department of Treasury because I was like, I need a job, and that's who our biggest contract was with at that startup. So I ended up there, hated my job. And when I was watching Megan go through that, I was like, Well, I make okay money, but like I would rather be broke and like sell cookie dough out of this cooler than have to go into the office, and I think that's really what like did it for me is I really wanted to like I saw something I liked. I'd always wanted to support uh entrepreneurs. Like, I don't think I was ever gonna be the idea guy, but like hopping in and like really like going for it with someone felt right. Um, it all just kind of happened, and I quit my job in July of 2017, and I have not looked back since.

Keith Kohler 5:13

There you go, Jimmy. I think an interesting thing about what you said, three times we heard I hated the job, I hated the job, I hated the job. And I deeply resonate with that because that was my experience. I was in corporate coming out of graduate school because I thought I wanted stability, and I thought that's what made sense to me, particularly because I grew up in an entrepreneurship household. And yet, what I found, and I'm curious to get your comments on it, is I thought I wanted stability, but I didn't realize that I was really not a big fan of a lot of structure that I knew I would get in entrepreneurial minds. I'm curious, is that your situation as well?

Jimmy Feeman 5:49

That that that's sort of what happened. I'll describe why. So I left this startup that I had interned at all throughout school, and and the rules at the startup were I was the intern, I had a boss who was the CEO, and then there was a COO, and that was the whole team. And there were times where we had other employees like in and out, um, mostly contractors, but it was like I I had an impact, and and they did not limit me for what I could do. So, like uh eventually my boss would just be like, Hey man, like I need you to do this thing, and like I don't know how to do it. Can you just figure it out, make it happen? And so I got really good at figuring out make it happen. It paired really well with my blue-collar parents' background. Like, I was kind of like a go-getter, we're fix it guys.

Keith Kohler 6:33

So you could do something and figure out how to address it.

Communication As A Founder Superpower

Jimmy Feeman 6:36

Yeah, so then when I transitioned into the corporate world, I worked for Jackson National, it's an insurance company, it's very structured. I was in the sales force. Um, we were wholesaling annuities to financial advisors. I went through a sales training program, it was very, very structured. There were three tiers of internal wholesaler, like you would like move up slowly, and then there were like other jobs that you could get after that, and it was extremely structured sales organization. Um, I'm a super motivated and competitive guy. I liked it for about three months, then I got pissed off. The reason I got pissed off, I wanted to do things or work harder, and you'll see this with people who I've always said are a players, but they're bored. And like I wanted to contribute and I wasn't allowed. And I got real frustrated with the way they did things. I thought it was stupid. It was just an entire waterfall of bad metrics at that company where it's like they want you to make phone calls because someone at the top thought, well, activity is what will get us sales, yeah. But you on the ground know that that's a bad idea, and I think the more that you see things like that inside your life, the more you're like, I'm not meant to be here because I can't stand you people. And the reason I can't stand you is because you're not actually performing at the level that I wish we would perform at. And I've always found that to be interesting because there's some people that hate their job because they just don't like working, there are other people that hate their job because they're like, this is really, really dumb. And like that dichotomy, um, it makes it hard to understand who's supposed to be an entrepreneur, maybe who's supposed to do something else with their life. But like, I was, I guess, in the entrepreneur bucket and didn't know it.

Keith Kohler 8:17

Well, here's a great question for you now. Jimmy, how long ago was that that you left that job? And Megan left hers with 2017, right? So it's almost nine years ago, yeah. Okay, so the way you're expressing it now, I hated it, the structure, the calls, blah blah blah. Could you have expressed yourself in the same way then at 23 and said, Hey, this is dumb. I this type of policies and procedures didn't work for me. Did you have that level of insight?

Jimmy Feeman 8:46

Yep, that's that's what originally why I left Jackson and I went to the startup uh that I had found a job at, is I was frustrated in that specific way. Um, could I have articulated the way I can now? No. It takes a lot of like reflection, I think, and like post-mortem to really understand like why your thoughts and feelings were a certain way. Um, and I think that's just kind of part of life. If you had known some things you know now in the moment, man, you make better decisions. Um I I found my way there, but slowly.

Keith Kohler 9:16

Yeah, but you did have pause and really reflect upon hey, does this working for me at not or not? You knew at least that much, even if you didn't have this full arc of expression that you do now. And Megan in a similar situation, right? Was she someone who was like, hey, these structures of the music industry or whatever? Or you had said highly relationship driven. So maybe the relationships were something she didn't love. Can you give a little more on that?

Jimmy Feeman 9:42

Honestly, for for Megan, she she understood herself more than I understood myself at the time. And she wanted to be like her parents who are entrepreneurs. That was one. She she liked the lifestyle that she had growing up, which was her parents could say, Hey, we're just gonna go on vacation, and no one can stop me. Like, that's a really cool thing to do. Um, she loved that, and she pointed to that specifically as like one of the things where she was like, I like that, I don't like that I have to request to like go somewhere from somebody else. And so it was a freedom aspect to it for her.

Keith Kohler 10:16

The words are written down in capped letters, right?

Jimmy Feeman 10:18

Now, yeah, right. And then this the second thing for her was she recognized that her job, and this is very post-mortem for her, and she could elaborate it on it more, but there's a thing that happened where she didn't feel that there was any upward progression. The music industry is very much a place now where, like, unless somebody dies, you're not getting promoted, and like that that's hard to deal with, and I it's not a situation I think a lot of like a performers want to find themselves in. So that that's probably the two motivating factors for her.

Keith Kohler 10:53

Yeah, and what's interesting is I hear you say that I'm reflecting upon many a different, many different companies I've spoken with, with husband and wife founders, right? Sometimes you see opposites attract, like one perhaps is more risk-averse, one is more risk tolerant, one might be introverted, extroverted. You often see that polarity, right? And yet it seems like with you and Megan, two Ps in a pod, right?

Jimmy Feeman 11:20

We're very similar. Um, Megan, I think I think most of the differences come from like gender, not to be like that biology guy, but like I'm slightly more risk tolerant than her, and she is slightly more like she she gets a better sense of people faster than I do. She doesn't trust as quickly, she has good gut feelings about like business decisions. Um I think that's like a female like superpower. Um, I also think that like being extremely like risk tolerant is like a male superpower, seems but like if you take those things away, we're literally the same person, um, which is interesting for founders because a lot of the times there's a creative and there's an operator, there's a salesperson and a person that's good at logistics. But like for us, we're both just very good at learning quickly, and I would say we're both more on like the sales and marketing side than on the like ops side. Um, but because of the way that our brands work and like the type of entrepreneurs we are, we've been able to make that work.

Keith Kohler 12:23

And I think a lot of our founders, particularly husbands and wives, will say, yeah, there are there can be certain traditional strengths associated with gender, like a men are from Mars, women are from Venus type of way. And I think for a lot of founders, embracing that and being honest with yourself, hey, I am tend to be this way, or just sharing with your with your found co-founder or partner, this is me. Hey, what do you think of that? How can we leverage that as a strength? And who cares which gender it comes from? At the end of the day, it's how does it help you come together and build a business, right? And here you are, you had not been married yet, you start this comp you you're supporting her in the company, and and I'm just gonna go down that for a minute. How did that help you grow in your relationship as you were growing in your company?

Scrappy Financing: Credit Cards To Franchise

Jimmy Feeman 13:12

I think, and I said this on a podcast last week, actually, or actually earlier this week on Monday, um, not out yet. So I'll say it here first. Uh, the the thing that happened, and the only relationship advice I can give because of building the business is that communication is the superpower that everybody needs in their relationship. It's unfortunately like you watch over and over again, whether it be founders or couples or husbands and wives or whatever, there's always expectations in someone's head that don't match reality, and then nobody talks about it. And that problem just rots relationships from the inside out. I think whether it's you know like romantic or not, um, it could rot relationships with you and your friends. And so building the business, what it allowed, or really what it forced, was communication. Because I think you don't build a startup with your co-founder and not communicate. So the communication became fluid and it became all the time, and it became if I'm gonna do something, I'm gonna consult with you first. We're gonna talk about everything that happens, we're gonna talk about money, we're gonna talk about decisions, we're gonna fight, we're gonna argue, and we're gonna figure it out because that's what you do when you're running a business. And that flowed into our marriage. You know, we got engaged in 2017 and then we got married in 2018. And since then, the one thing that has allowed us, I think, to have a slightly better marriage than like average, which you know, I don't know if that's actually true. Like, we're still working on it. Um, it's not something that's easy. Um, and making running a business doesn't make it any easier. But I do think because of the adversity, and because it's not easy, it's actually better. So, like if you can survive the gauntlet, so to speak, definitely supposed to be together, but also relationships are an effort from both sides, and it's just like being on any team, everyone has to kind of like pull their weight, figure out where they can fit and help, and then also constantly like work at it. Like you have to show up and do that every day, it's very, very hard. But communication is the thing that was forced. I've come across so many other like couples where they're like husband will be like, Yeah, dude, I bought a dirt bike, but I didn't tell my wife.

Keith Kohler 15:26

Like, yeah, the hell like that's a common phrase, and I didn't tell my wife, or don't tell your father, right?

Jimmy Feeman 15:33

Or can you imagine not telling your business partner about a major purchase? Oh, yeah, it's called fraud, but yeah.

Keith Kohler 15:41

Well, I mean, it's that's it, and I often get that, right? Where whether it's husband and wife are just co-founders in general, a lot of times I see this pulling apart, right? And there can be jealousy because oh, Megan is much better at this, so Jimmy's gonna torpedo her, right? And Jimmy's better at this, and Megan's gonna get jealous or upset. You see that, and and it's a shame. And I'm glad that you have this communication, and I that's why I'm going down this tangent. It's such a good point to make. And I wonder for all our listeners and viewers, if they were really to reflect upon hey, am I a good communicator number one? And am I actively doing that with my co-founder or andor those interested parties that have a role in building the business, whether it's your finance team, investors in some case, anybody that's reporting to you, because I wonder if you could just comment on what I'm about to say. Great communication, I think, results in the very, very best chance for you to have real alignment both strategically and energetically.

Jimmy Feeman 16:50

It does, yeah. And and it gives you the best chance because you're simply talking about it. It's that expectation thing where like unshared, unshared expectations or unrealistic ones or whatever it might be. Those things are usually what come to like haunt co-founders. I I think um, especially in the business world when it comes to like who's gonna do the work. I've seen over and over again where it's like you guys went into this not talking about like who is gonna like pull their weight and what that looked like to one person that may look different and then to the other person, and then suddenly there's bad blood. And you just you have to communicate through those issues. I I tell people that now when I when I meet them when they're very early on in their journey, like, hey, you should just you really, really gotta work on the idea that you're not gonna like keep things in your head. Um whether I mean these days, like people use a notion board or like a shared note or Slack or something where we like write our thoughts down so that we're not like keeping them inside. And I've been dealing with this recently with uh a couple new ventures that I'm starting, where like have other co-founders for the first time, and um communication has become like really really important, and and I've I've found that like the best way to approach that is like let's have a weekly or bi-weekly like meeting that we just have to do, and we have to do it because it's a good way to just on the calendar and that's it, right? It's yeah, even even if it's you're just like shooting the shit, we're talking about like our dogs, like that that's still us building a relationship and connect and enforcing it, right?

From First Shop To Franchise Vision

Keith Kohler 18:30

Yeah, I really love this arc of how we've gotten to this point about the importance of communication, and you brought up something a couple times, which it's been reinforced to me in the coach I work with, Dr. Aaron Wilkerson, about mismatched expectations, right? And the way I see that play out is just like you said, building a company is not linear, right? And sometimes it's it's like this. And again, there may be days where Megan, her energy is off the charts and Jimmy, you're dragging, right? And yet if you're communicating, you have the best chance of perhaps bringing each other into a level of balance that makes a lot of sense. And I just really love that. And mismatch expectations. I'm gonna bring us back to the theme of how I financed it, right? Is can be on what are we gonna do to finance this business? Right. So here you are, you're you're at that farmer's market, you're realizing there's something here. When you started saying, okay, we're gonna grow this, what was your original financing plan?

Jimmy Feeman 19:32

Oh, this is so much fun. Um, Megan now are very creative. I will I will preface this with we were 23 years old. Uh, we both had only student debt to our name, and that's about it. Um and not a lot of resources. And so you have to think to yourself when you first start like, what is my plan of like attack, right? The one thing I'll give myself credit for at that age, I won't give myself very much of for anything I did. 23, but um we did a really really good job of like getting out, hustling, building brands, and then understanding the numbers at the unit level. And so what I tell a lot of founders is like, do you understand like how many what what your real metric is in your business, right? So, like, I'll give an example from that summer. We knew that we had to sell X jars of cookie dough at the farmer's market once a month in order to pay all of our bills, like our rent for our apartment and like all these other things that we still had to pay for. And then we knew we had to sell X more in order to save up money to build the first scoop shop. We also knew that we were gonna need to borrow some money, and we found that the easiest way to do that, this is not financial advice, was to um go get as many credit cards as we possibly could and max them all out, uh building our business. Now, I will say that back at in the day at that time, you could get like a nice like 0% introductory, like 18-month APR. And like if you have a plan to invest the money, that's probably good. When I say invest, I don't mean buy Bitcoin. Please don't do that. But like if you're starting a business, you do need to be creative about where the money comes from. And we weren't gonna ask our parents, right? Like, that was not on the table, that was not something we were gonna do, Megan and I at the time. I have gotten over this a lot, but like Megan and I both have a quite a big chip on our shoulder for different reasons, and I think that then causes you to make a lot of ego-driven decisions, and so one of those was we are not asking our parents for help because we're gonna do this on our own, even though I will say now at 32 that I know for a fact no one does shit on their own. That's not real. Like nobody can sit there and say, I did this on my own. We live in a society, and in that society there are millions of human connections, and you don't do anything on your own. You get help from millions of different people, you get help from your customers, you get help from your employees, you get help from your friends. Um, and so I will say that, but back to kind of how we financed it. So we used those cards to build the first store, and then we proceeded to pay those off. Moving forward, though, we did have to have a financing strategy, and that strategy for growth for us was actually franchising. Franchising is often thought of as a growth strategy when it's really just a financing strategy, you're getting other people to pay for the build-out on your physical thing or pay for the growth of your company, and in return, they're getting most of the upside and you're getting a royalty. And so I think that a lot of people should consider alternative ways like that, whether it be the credit cards or the franchising or whatever else it was that we did in the beginning, when it feels and seems as though you have no resources. I was 23 with a bunch of college debt and like a decent credit score with like no money to my name, and it could barely pay my bills. And yet we were able to build and create this giant thing out of thin air, but it didn't come out of thin air, it was financed by our customers, and it was financed by the franchisees, and it was financed by the credit cards, and like anywhere else we could scrounge together money, and I would always push people to just think creatively about the things that are actually available to you. Too many people have like a defeatist mindset where they're offered that challenge, or rather, they're offered that opportunity. I looked at it at the time, I looked at Megan that summer and I was like, this is the opportunity of a lifetime. People actually are lining up to buy the thing that you make. Like, do you realize how special that is? Like that in and of itself, and and I would push any founder to think about this. Like, if you have a product and people are showing up to buy it, that is so cool. That is amazing. And so to not grow it is kind of a travesty. It's kind of like saying, like, I say this all the time, I want to live life in a way where I did miss something, like I didn't miss a thing, and like the easiest way to not miss a thing is to take the risk, try it, do it. And so, yeah, we just had to be creative. That's kind of the the long story of it.

Keith Kohler 24:07

And then going back to elements of that long story, um, I really identify a lot, and I think a lot of our viewers and listeners identify with hey, the chip on the shoulder, and we wanted to do it ourselves. Did your parents offer? Or they didn't offer? Okay, that's a key thing, that's a dynamic, too, right?

SBA Loan, Fast Growth, And Friction

Jimmy Feeman 24:29

Yeah, and I mean, my and realistically, Keith, like, I don't know if they would have offered because all of them were kind of like, hold on, like, this is a terrible idea. Which I mean, you would you see that from your parents, they want to keep saying, Yeah, there's a there's that like it's a funny thing.

Keith Kohler 24:47

I grew up in an entrepreneur household, right? So I again was in corporate for several years, and then I joined my family business, and that is uh it's whole own two-hour conversation. But the point was is that at least I never felt held back by anybody, right? My parents never said, Oh, that's and then when I went later to do my own thing, no, that's a stupid idea, or what are you thinking? Blah blah blah. You stay in corporate. Happily, I never had that, and yet I think Jimmy, 90% of founders have an experience like you have, where someone gets in your ear a little bit to say, What are you doing? Is this gonna work? XYZ, and right, and how do you tune out that noise?

Jimmy Feeman 25:35

I think um you have to be your own biggest fan in the beginning. Alex Ramosi has said this best like recently that like no one will be cheering for you when you need it, they will all cheer for you when you just don't need it anymore. Once once, once it is clicking, everyone is like, yeah, and I experienced that in 2017 in the biggest way. We slowly converted each one of our parents one by one and everyone else around us into being a believer because they just saw the proof. But when we needed it the most, of course it's not there. You have to simply like get that from inside, like you have to get it from you, and like maybe me and Megan got it from each other, and she definitely got it from me a lot. Um I but people that meet me will say, like, Jimmy is like not only an entrepreneur, but like I'm a degenerate risk taker, and like I'll be your biggest fan. Like, I'm I'm the guy that will be like, let's let's go, like, this is gonna work. And so, like, I'm usually overly optimistic. There are not a lot of people like me that will be in your life. I think it has to come from inside. Um, and I think Megan, for her to her credit, it came from inside, period. It wouldn't have mattered if I was there. Um, it wouldn't have mattered if anyone supported her, like she would have made it happen. Um, she willed that shit into existence. Like, I have never seen someone will something into existence in my entire life. And I think about that somewhere all the time. Like, I think about how can I replicate that sort of action today, every day of my life, because you have to remember, like, when no one's got your back and you've got no resources, and in a short period of seven months, we went from concept in the kitchen to a scoop shop with a two-hour line out the door. In seven months. Yeah. So the first shop was October 2017, paid the shop off in one month because the thing was just clicking, it was going to the moon. But when we leased that shop, we had to beg, we had to like ask hundred landlords, will you please rent us a building? Because no one wants to rent a building to a 23-year-old. Right.

Keith Kohler 27:42

And your personal financial statement with credit card debt. Terrible. Everything. Yeah, you're not the project, but someone who on paper is likely to make it, right? And yet, yeah, that's what's flawed often about the financing process or anything like this, is they cannot, these processes, unless someone really takes the time to get to know Jimmy and Megan, they can't know your grit, your resourcefulness, your dynamic, your energy, all those different things.

Jimmy Feeman 28:17

They also thought we were insane. I mean, they also thought we were completely crazy. Well, yeah, I mean, think about it. You imagine two 23-year-old kids coming to you. This is how insane we were. Uh, two 23-year-olds coming to you in July of 2017. This is four months after they started the business. They sit there and say to you, Yeah, we're gonna open a store and then we're gonna franchise it. We're gonna be at 100 units in the next like three, four years, and we're gonna exit for 20 million dollars. So you knew that. I was saying that out loud like a crazy person.

Keith Kohler 28:47

You were saying it, of course. You were saying it out loud after just being these few months in the market. You already get stepped into that vision of here's where we'll go.

The Pandemic Pivot To E‑Commerce

Jimmy Feeman 28:58

And then we lived it. That was the hilarious thing. Is like we so the but the adversity that I think about is like so, like, we're we're we're really, really broke, we have no resources. We finally get someone to lease us this old building. Three restaurants had failed before us. We would be the fourth one that supposedly was gonna fail, is a terrible location. Um, we meet with contractors, there's not enough money that we don't have enough money to pay them. And then Megan looks at me at night as we're laying in bed and says, we have to build it ourselves. And I was like, no, I remember this like it's yesterday. I was like, no, no, no. This is still when I was not, I wasn't there yet. Like I wasn't a real entrepreneur. Megan, born into it, was, and she was like, oh no, we're gonna build it ourselves. Like it's already got a kitchen, all we have to do is like paint it and like do some other stuff. And I was like, I I'm not a construction worker, and she was like, You are now. And I was like, Jimmy, you were higher. Um, yeah, right. And then uh, you know, my my dad actually came down and helped me finish the work on the store. We did build it ourselves, we got it open, got it open in six weeks. I went to code building codes on my own. I like crashed course and learning how to like build a commercial building. Um and the work was shoddy and weird, but like I got it done. We got the store open. We we went through this really weird arc of like we were working like 19 hours a day. Like we weren't sleeping. I was sleeping at the store. We were simultaneously having DoorDash people come to the store and postmates people and pick up cookie dough from a freezer while I was putting tile on the wall, while we were trying to like hire people while like we had no money and didn't know how we were gonna pay our rent next month, and then everything just clicked when the store opened. And instead of slowing down, we just doubled down because, like you said, we had already stepped into that vision. I paid for a franchise consulting firm and a franchise lawyer to like draw up documents, build the ops manual, come visit the site. Like then we opened the second store in March of uh 2018, and one year after Megan came up with that idea in her kitchen, we made $120,000 in profit in one month at 24 years old. One month. It was disgusting. It was crazy. And you got to imagine being 24, being one year into the thing and being like, oh, we're doing it, and we're we're about to sell franchises, like people are interested, we have leads, we're about to start like actually making it happen. And the crazy thing is that's that's kind of when the problem started for us because we weren't getting enough adversity. Um, and then the pandemic happened. There are a lot of other things that pushed us off.

Keith Kohler 31:48

Can I hold can I go back to that comment again?

Jimmy Feeman 31:50

Yeah, yeah, yeah, yeah.

Keith Kohler 31:51

Let's repeat it, right? We did not have enough adversity.

Jimmy Feeman 31:58

No, we're really bad at running downhill.

Keith Kohler 32:02

Right. So let's witness that for a moment because how many founders when you went, not just what you achieved in this short time frame, you had this vision. The second store was not franchised, right? It was company owned.

Jimmy Feeman 32:14

It was ours, yeah.

Keith Kohler 32:15

Okay, it was yours. But the ballsiness, I don't know which other word I'm gonna use, but in a in a it's it's not cocky or arrogant, it's really just a deep level of belief and conviction when and exponentially elevated by the fact that both you and Megan were all in on it, right? And so energetically you knew you could get there. And to hire the franchise person a few months in is astonishing. In a more traditional route, of course, traditional to me, I wonder what that even really means. But for a lot of people out there, they might have the flagship restaurant for one, two, three years. Hey, they wait until they might have it for a decade. That's right. They wait until it's nicely profitable, and a lot of times they're they might even be brought kicking and screaming into that franchise, thinking, oh, I gotta make more money because I got to pay more bills. They might not even be all that excited about it. Conversely, they might also follow, no, my customers really love it, and I have customers 30 miles away, I need to have a location there, stuff like that. But you did it right from the beginning, and so you made the investment, which cost a fair amount of money to get set up for that, right? Yeah, and that money came from the income from operations because people were coming in. So that was your next level of financing was income from operations.

CPG Realities: Capital Stacks And Burn

Jimmy Feeman 33:43

It was our customers, yeah. And and I I think it really informed a lot about how I think about business today when people ask me about how did we get started. I have a lot of consumer founders now ask me because of our work in CPG, and it's a really hard question to answer, but it's like you just kind of have to get out there and sell, and that's not gonna be simple and easy for anyone, and it's never gonna be like obvious, but there is a channel like that, like what our scoop shop was for us for almost everybody, and um again, you just have to be really creative. I think when we leaned into the journey post that um, I say there was like a lot of adversity after that. There was, and there's a lot of adversity growing and building a franchise system when you're a child, because that's what we were. Um and we we we got we we got hoodwinked by a lot of what I would consider con men um in the industry, and a lot of like leachy people like latched onto me and Megan in order to kind of ride the coattails of the brand, make money, whether it be like the real estate broker that we eventually got connected with, um who was like a franchise real estate broker, the outsourced sales firm that we hired that was charging us way too much money, um, other people who didn't have our best interests at heart at all, um that that started to create a lot of adversity, like on accident, but probably just from inexperience and being connected with the wrong people. Um but I mean, all of that was like uh objectively, sure, things were like not great going into the pandemic. A lot of our like stores were like not doing great, a lot of franchised stores weren't doing great, but they were solvable problems. I think we would have solved them. If you had not seen the pandemic happen, we probably would have continued that growth trajectory just based on like pure like grit commitment. But we did get an SBA loan at the end of 2018 or end of 2018, beginning of 2019, in order to fuel like more growth in that arena. So, like even though we were franchising, like I said, we were connected with a lot of bad people, we were paying a lot of people to do a lot of things that we shouldn't have been. But again, like you live and you learn. I think the thing that I wish I would have had back then would have just been like any kind of mentor at all, anywhere. I didn't, I which is strange to say out loud, but it's like with just a little more direction, Megan and I could have instead of no big click floundering around if it's still growing like a rocket ship, it probably would have grown like a rocket ship in like the perfect direction. And I can't like go back and post mortem that now, it's all part of my story, but like I'm very thankful for it, but it is interesting to know that like, yeah, there is an aspect to having experience that will allow you to just miss certain mistakes. And again, you can't take that advice from someone who hasn't been in your shoes before. So that advice wasn't coming from like Megan's parents, it wasn't coming from like other rando like small business owners, like it would have come from someone who had grown and built a franchise system before, and yet I didn't know anybody like that. I didn't have anyone like that in my life, and I wish I would have. It would have been great.

Keith Kohler 36:51

Yeah, Jimmy, there's a lot in what you just said. Um, I'm gonna come back to you in two parts to explore a little further. Tell us a bit about what that SBA loan was for and how you went and got it.

Jimmy Feeman 37:03

So we went and got an express loan because they're a little easier to get. Back then it was $350,000, was the max, so we got $350,000. Uh, the reasoning behind it was we wanted to build more corporate stores. Um it was like half corporate stores.

Keith Kohler 37:18

Right, was hey, build equipment and working capital, all those different things.

Jimmy Feeman 37:22

Yeah, and it's mostly working capital and equipment, and then uh salaries because you cannot and marketing, because you cannot necessarily use those monies to do leasehold improvements. Um, so it was like an interesting structure of like how we structured it when really a lot of those funds actually went to leasehold improvements. I'm sorry uh to whatever bank that was. But um, I mean, the the loan ended up being quite a good thing for us. Um, it allowed us to kind of fuel growth through the remainder of the year. We definitely would have ran into like funding issues, I think, in 2020, regardless of the pandemic, but we would have tacked those then in a different way. And I think there were a lot of other creative ways we could have continued to finance the business, especially once you have like a restaurant like that. Really easy access to like your POS's um like advanced program, like if you're on Square or Toast or anything like that, the rates that they charge are actually not that bad. Um and it's not necessarily a bad thing if you're focused on growing with the money. I think it's a bad thing once people get into the debt cycle of taking the advances to pay bills, and I have seen that before.

Keith Kohler 38:30

For sure. You're right. It's a really good observation, Jimmy. So that 350K, you're already profitable, you had a good sense of where it was going to take you to that next level. Was the company still operating profitably, even with the headwinds of the pandemic? Were you able to or at least break even?

Jimmy Feeman 38:49

We I believe I'd have to like go back and look. I think we lost money in 2019, but it wasn't very much. Like we broke even essentially. That's not bad, really.

Keith Kohler 38:58

Think about it.

Jimmy Feeman 38:59

Yeah, and and we we grew to nine stores total by the end of 2019. So we we went from zero to nine in two years, like a bunch of crazy people. Um, and then we have uh a bunch more stores planned, uh, and then the pandemic kind of threw all that off. So I spent 2020 learning how to do direct-to-consumer e-commerce and uh litigating a bunch of leases that we no longer were going to uh build stores with, and um I we we continued that litigation until like 2023. Um took a very long time.

Keith Kohler 39:36

And you were still paying rent expense, even if we weren't paying rent expense, no.

Crowdfunding And The Cost Of CAC

Jimmy Feeman 39:41

So we we we walked on a lot of them. Um a lot of them we never we never started construction, we just signed the lease, and the stores were planned to start construction in 2020. And we were just like, dude, like one store specifically is planned to start construction in like April of 2020. Like, no, we're not building this store now. We actually started closing stores. Um goodness. And then we we we really stepped back into like the the startup mode, I think, in 2020, though. The 2020 is the year my daughter was born. Uh, to my first kid, and pandemic happened, and we had to do that pivot, and a lot of that all lined up like March, April of 2020. And uh it allowed me and Megan to kind of jump back into founder mode, um, but with a lot more experience and a much bigger network and people that had done it before. And the direct-to-consumer business took off like a rocket ship, really saved the company. Um, and we did the most revenue we had ever done in 2020. Um, so the company just kind of continued to grow. Now the franchise and like scoop shop business was completely dead, but we did like 1.7 or 8 million online. Um it was like somewhere between one seven and one eight. Yeah. Yeah, a big number two have done like in really just nine months because we the skip the I think the online store January to March probably did like fifty thousand dollars in sales, so it was it was not like uh nominal, but it was pretty small compared to the rest of our business. And then yeah, it was just it was embracing the pivot really, and I had just read the lean startup, so I was very inspired. The word pivot was like on my mind, and yeah, the stars just kind of aligned, man. And I I don't regret the the pivot into CPG. It is funny, you know this because we we work on it together, but we have as of 2025 kind of like on all the looped all the way back around and started to like kind of latch on to what we were working on in 2019 and start franchising again. I think it's a good business model for our product, but yeah, we took like this five-year detour into CPG, which was educational to say the very least.

Keith Kohler 41:50

Um, you're being a little euphemistic, aren't you, Jimmy, with that word educational?

Jimmy Feeman 41:54

Yeah, I mean we never it's funny. I told you about all this money that we made like doing franchising and running the scoop shops, and then like CPG has just been like uh a very large money pit. If I for lack of a better term, like uh honestly, we we had great unit economics, we manufactured the product in-house. I built a manufacturing facility in Chattanooga. You're very familiar with the consumer world and manufacturing. Um very hard to do. It was a lot of work, a lot of effort, a lot of employees. Um, we got into about a thousand retail doors. We grew that direct-to-consumer business and ended up shutting it off because of the unit economics. Um, leaned into retail really hard, had that plant, did some copacking work for some other brands, tried my hand at a whole bunch of stuff. And um, we only raised about $450,000 from the crowdfunding round. That was the only financing we ever had for the the CB50 business outside of like some small credit line stuff with like Wayflyer. And I wouldn't even call that a credit line, I don't even know what you'd call Wayflyer, but um short-term, a short-term debt. Short-term debt. Yeah. And it's it's funny when you look back on it, it's like we we spun our wheels a lot, and I think the reason we spun them so much in CPG was the resistance to raising money.

Keith Kohler 43:15

Um, and I now kind of look at the different yeah, sorry to interrupt you because the resistance to raising money, because of where you had been with the scoop shop and the chip on the shoulder, I'm not gonna ask people for money. Was that what was doing uh driving that decision?

Jimmy Feeman 43:32

No, I think it was mostly fear of being like rejected, and then and then I tried to raise money and I was rejected. So I I think it was mostly us like just kind of failing to raise. Like we we tried in 2023 really hard, actually. Put together quite a good process to raise. And I spoke to about 200 and fosters and VCs and private equity groups, and uh we just couldn't put the round together. But I now kind of look back on consumer as it's like if you want to succeed, you're gonna have to have the cash to do it. And 100% it's not gonna be an easy road, and it's definitely not something you can bootstrap unless you have some sort of like monster business behind you. Like if we had already built a franchise system, I was already making like one, two million in Ebitot. Maybe then I could have bootstrapped a consumer brands, you know, dumping all the EBITDA back into you know, CPG, but to do it bootstrap the way we were doing it, where like Megan and I were kind of on a shoestring budget of just, I mean, our business probably like made like two quarter million a year, and like we're we're pump pumping that back into the CPG business to try to make it work. Um, and I'm referring to the scoop job business. So, like then, like when you look at the overall financials for the company, we're just losing money every year. Uh it was an interesting dichotomy because it was like, I want this to work, um, I want it to work really, really bad. And it took a really, really long time for us to just kind of let go of the idea of growth if we hadn't raised. Um, but yeah, I mean, fine, so like back to the kind of title of the show, it's like financing that and financing businesses in the consumer space really, really hard. And I think you have to have a lot of like foresight from day one, and we just did it. We made a lot of mistakes, capital stack got real jacked up. Um just didn't know how to raise equity, and we didn't know how to capitalize on our momentum. I mean, if I could go back in time, I would have tried to raise that $3 million round right on the tail end of our online store blowing up and like moving, like and uh us having momentum, and I would have attempted to capitalize on that in a really good market for raising and had the cash and then gone to to war and like done the thing. But again, you can't you can't like really hindsight things. Only now I can kind of look back and say, like, okay, I would have done things a little differently. I would have like had a really good invoice factoring partner, I would have a really good equity, like equity rounds that I had raised, just kind of like understood where things were gonna be financed and like how it was gonna work because in consumer different than like restaurant, you have to be very, very like you have to have good foresight on that. Um you know how where the money's gonna come from, how you're gonna grow. Yeah, yeah.

Back To Franchising With Discipline

Keith Kohler 46:15

Yeah, so just uh you're you're alluding to the key thing, which is your cash requirements in the scoop shop and how that would evolve over time, versus cash requirements in CPG, a could of course a completely different look. And yet the cash requirements for CPG are far more unpredictable, right? Um and who knows how it's gonna unfold. And yet, just being dedicated to it and doing the exercise and keeping it updated is giving you your best shot, right? And I'll just go back to one thing really quick, Jimmy: the crowdfunding. How did that come together?

Jimmy Feeman 46:55

So that actually came together because we were on the tail end of all that growth for DDC and the DDC business was technically losing money, like it was growing really fast, um, but it was starting to lose money instead of make money. And so we were at this inflection point that a lot of e-com brands hit around that time, which was that if you're paid paid ad heavy for traffic, um your your cap started to go up um as more and more people piled into the market and track these meta-ads to blow up their pandemic business. Um, so that like supply and demand of eyeballs caused our unit economics to get off. So we got into a spot where we were essentially break-even on the unit. So every time I sold an order online, I would make zero dollars. I would do zero dollars as well. But then I had no money to pay overhead, so like my salary, like other people's pay. Um that's where we ran into the issues, and then it was like, okay, we need a way to fund this. Crowdfunding seems to be the right way because what we want to spend the money on is marketing, and you wouldn't necessarily borrow money to spend on customer acquisition. That's kind of a terrible idea. Um people could fight me on that, but I agree. Like in a consumer space, you should probably fund equipment and working capital, especially inventory and like Rawls with like debt and every single time, and you should probably fund customer acquisition with equity and RD with equity, and you don't need other reasons to raise equity. That's a silly thing. Um so yeah, like I it's like those two dichotomies trying to set those up. That's why the crowdfunding round came to be. It seems to me at the time the easiest way to raise. Um, we just didn't know how to put together a real like round, and and I didn't know my network was still so small, I still wasn't like at the place that I am today where like you know, a lot of people, I probably could have like put together around like I did in 2023. I I don't think I could have done that in 2021, and it was early. This is like January, February, March 2021 when we're raising that money. Um, and raising it from our customers just seemed like an easier play because that's really what we did isn't find the customer email list. Yeah, and you know, you gather a thousand dollars from 500 people and you raise 500 grand, and that's essentially what we did. That's it's about what the round was.

Keith Kohler 49:19

Brilliant. So now here you are going back to franchising, right? And just in 60 seconds or so, kind of give us hey, what what could that financing look like? How would you how are you setting up the franchise model?

Mentors, Resilience, And Final Lessons

Jimmy Feeman 49:32

Yeah, so today we we re-jiggered no bait, uh, like we really really rethought it in 2025. So came into this year running the plant, uh, thinking maybe I'm gonna do some acquisitions of some other brands. And then I had a little bit of a midlife crisis, said no, I'm not gonna do this. Moved to Montana from Nashville, shut a lot of stuff down, scaled a lot of things back, and said, if we're going to run this business, we're now gonna do it in a way where it can grow organically. Period. Like, and so the funding is gonna come mostly from debt, we're not raising money. We have to accept that now. How do we do that? And so there are two main growth mechanisms to Novakes at the moment. And the first one is like organic growth in the grocery store, like you know, switching to using a coman, using the right capital stack with the CO-MAN will allow us to essentially float the inventory until we get paid for it, which is awesome. So, like doing that and then only growing as fast as you're allowed, or as fast as your customers allow you to, which is really just using customer funds to grow. And no, that's not a great way to grow in CPG, it's a smart way to grow in CPG. I wouldn't say it's fast at all. Um, on the franchising side, what we realized is we now have all the experience of almost eight years of running the scoop shops, still have some open. Um, and we have a very, very high performing one. And we realized with all of the data that we have, all of the experience, the team, that now we're ready to franchise in a much more intelligent way. So I can now look at someone and say, like, hey, if you buy a franchise of Nobate Timedo, here's exactly what we're gonna do. And Keith knows that like I connect my new franchisee uh approved applicants with him uh for SBA financing because it's a great way to finance a franchise store. Um, but I have a whole process where I connect people with you, I connect them with a real estate broker, connect them with a headhunting firm to help them find a manager. We have a manager profile that we've built out uh based on yeah, what people have done in the past and really like built a process as like a pain pill for business ownership. Um, and the way that we're financing that is also organic. So I look at franchising as a funding mechanism. The way that like I'm funding it is bootstrapping. So I'm doing the franchise sales, I am very experienced at doing it now, and I'm also doing the franchise operations uh because we only have one franchisee and I won't have very many. Um, and so we're keeping it real lean. I will be hiring at some point as we grow, but it's mostly about being like very, very uh careful of the way that you grow and growing slowly, and then allowing your customers, your franchisees to fund the rest of the growth um of the company. Um and so, yeah, I mean, like on this side of things now, the way that I choose to fund it is that way because it serves me and my family better. Um, I think for a long time, the chip on the shoulder and the ego and a lot of the other things that were at play in my life caused me to make bad decisions because I didn't want to admit that I had failed or admit that like I needed to like take a left turn instead of a right turn. And so I constantly just kept digging myself a hole in a grave, and a lot of that had to do with the type of funding that we chose, or like we were doing like you know, the spray and pray, like, hey, we need to get this PO financed to like borrow from these people, like and like that doesn't work, it's not a strategy, and so again, like I think you should it like I just said it like even though we're growing organically in CPG, we're using an entire capital stack of like debt to make sure that we can like fund our working capital. Yeah, so like making sure you have terms on your purchasing, making sure you have someone to factor your invoices, making sure you have a backup PO financing partner, and then making sure you have a little bit of working capital just sitting in the bank so that you can actually deal with the fluctuations that would probably happen if somebody orders more product, and then just being very, very diligent about selling to people who are not gonna kill you with deductions and being very, very diligent about if you're going to pay slotting fees and get into a new store, just knowing what that means means that you're not going to see the money for another year because it might take a year to make it back.

Keith Kohler 53:53

So, Jimmy, um, thanks for today. I really appreciate the time we've got to spend together. And I have a tradition here at how I financed it, and I always end this discussion with two questions. So just very quickly, and whatever comes to mind, what are you most proud of?

Jimmy Feeman 54:10

I think the thing that I'm most proud of at this point is that we were able to build what we've built. Um despite the odds that it probably shouldn't have happened. I think I I watch and see a lot of my competition in the space over the years, like has like kind of withered and died. I don't think it's ever for lack of like a decent product or like customers or whatever. It's generally like they quit, like they just decided like I can't do this anymore. And you see that a lot in the consumer space, you see it a lot in the restaurant industry. And I'm really, really proud of the fact that like we just haven't quit. Rather than quitting, we found different ways to do it that were better suited to us. We were always looking for the right path, we just didn't stop moving forward. And I think you know, if there's anything I can be proud of, it's at least the fact that we just continued to move forward despite I had really dark times, really bad times. There have been times where I've been very upset, but like I moved through it, and I'm really proud of that.

Keith Kohler 55:18

That's awesome, and I think that ties back to the communication that you and Megan always had that you could ride those waves together. And what would you say? You've alluded to this throughout our discussion, so you kind of perfectly foreshadowed the final one, which is what would Jimmy today tell that 23-year-old Jimmy?

Jimmy Feeman 55:36

You should look for mentorship. That would be uh that would be my number one piece of advice, though, seriously, for for younger entrepreneurs. I you don't really know what you don't know, and I think looking for people that have like walked the path you're trying to walk is so important. And I don't mean hire a coach, I don't mean pay for a course, I really mean like find someone who actually wants to like just give you a little bit of advice. Maybe they won't have a lot of time for you because they're very busy, but you seek those people out genuinely. A lot of the times one or two of them will say, sure, I'll get coffee with you, sure, I'll give you some advice. Um, to build that network and that friend group because that support system is so important for being a sounding board. If I met me when I was 24 and I was hiring that franchise sales firm, for instance, and I had told younger me told me now, yeah, they want us to pay them $5,000 a month, but they seem to be the best in the industry. I don't want to I want to make sure they don't work for one of our competitors. What should I do? I would say, you're stupid. You should sell the franchises on your own. You don't need some sales firm to sell them. Uh it's quite simple, and you're suggesting spending all this money for no apparent reason. Like there were a lot of things like that where like someone with more experience could have just told me their opinion. I may not have listened, I probably still would have done it, but like at least you would have gotten the advice. Like, at least someone would have given you a second point of view. Um, and I think having that secondary point of view is so important.

Keith Kohler 57:10

Yeah, Jimmy, I really appreciate that. So the importance of mentorship and feeling supported, right? And I think that's a terrific theme. And certainly in the entrepreneurship journey, a lot of times people will say this feels so lonely, or I have to do everything myself. And yet I wonder, after hearing you, might that encourage someone to say, Well, wait a minute, I do have an opportunity to reach out to get that support and to feel supported in some way, whether it's functionally or or mental health or energetically, etc. So, Jimmy, just really want to thank you for stopping by and being a part of How I Financed It episode number nine. So um, thank you for joining us. Yeah, and this is us signing off. All right, see you guys. Thank you so much for joining me on this episode of How I Financed It. I encourage you to reach out to me on LinkedIn at Keith Kohler1, and I look forward to connecting there.