How Val's Cheesecakes Reached $971K and Took a $50K Equipment Deal

Val founded this cheesecake store in honor of his mom.

I took care of my mom through terminal breast cancer. Oh, wow. And every Sunday we bake one cheesecake.

His first farmer's market, he did just $6 in sales in 2013, but scaled to almost a million dollars of revenue in 2019. Why does your voice get so quiet when you share the numbers? These are so exciting.

Oh my god. It was... It is exciting, David.

$385,000. Damn it. This is an amazing year.

Now he needs capital to expand the business.

We're looking about $60 for extra refrigeration for a better oven as well as electrical power output.

I'm gonna go inside and see if there's an opportunity to invest.

Hey. You must be Val.

Yes. I am. I'm Nathan. Nathan, nice to meet you.

It's really good to meet you.

You too.

I hear these are the best cheesecakes in Dallas.

They are, and I would like to think they're the best in Texas. Right? Texas. That's right. That's right. For sure. I started this business about fifteen years ago. I started to be... Because I wanted to honor my my mom. So I took care of my mom through terminal breast cancer. Oh, wow. And every Sunday, we bake one cheesecake. So every single cheesecake that's on the menu, it's a specific Sunday with her. I can tell you the date, the the the month, and everything.

Why cheesecake? Why not apple pie?

So in Haiti, cheesecake is not our thing at all. Alright? But this girl, my mom, went to Brooklyn when she was about 19 years old, and she learned how to make a cheesecake at an all Jewish bakery right then and there. And then so when she was forced to go back to Haiti to marry my dad, we were the only house baking a cheesecake in Haiti. I moved here and then she, she ended up staying because

I didn't want her to go back to Haiti because we found that she had terminal breast cancer. So I told her to stay and then every Sunday we bake one cheesecake for four years. So there's about 245 recipes under my bed in a green box. And so after her passing, I said, you know something? I'm gonna put a little business plan together. I'm gonna market myself. I'm gonna beg these restaurants in town to carry my cheesecakes,

and they did, and it's been history since then. I think she would be very proud to see this business for sure.

So when did you sell your first cheesecake? What year?

I sold my first cheesecake March of twenty thirteen thirteen at the Dallas Farmers Market here. I didn't know what I was doing, so I went to the Dallas Farmer Market, applied for one day at $50, and I sold one cheesecake jar.

For how much?

For... It was $6.

Okay. So you lost $44 that day.

I did. I did. So I came back the next day, paid another $50, and sold out that day.

How many did you sell?

So I had brought a 120 jars.

At what price? Do you remember? At $6. Oh, wow. Okay. So, I mean, you're doing, that's, like, about a thousand dollars of sales almost. When did you actually put the open sign on this physical location? What year?

So so we opened our first shop on Maple Avenue, which was a little shack, June 2015, and then we opened second shop on Greenville in 2017, and we opened Fort Worth. So we had a... We had about five locations at the... At some point.

So How much in total sales had you done before you opened your first brick and mortar? Like, life to date?

About $46,000.

Okay. So that was enough traction for you to go, okay. Brick and mortar.

Yes. And then I had a... I I was a civil engineer at the same time. I had my job at the city of Arlington.

So are you comfortable sharing the salary you were making before you quit?

I was making a $125,000 a year.

Do you remember first year total sales in 2015?

$96,000.

Was that above or below, sir, what you were hoping for?

I told myself, if I can make $40,000 for the year, I think I'm good. And I made $96,000.

Any profits that year or were you breakeven?

I broke even. I didn't make any any extra profit because I had my jobs.

Take us into year two. What did you end up doing total that year and how many locations did you finish 2017 with?

So year two year two was 2016. It's 2018 that I started to see a profit and it's about between the two locations. We were running about $385,000.

Why does your voice get so quiet when you share the numbers? These are so exciting.

Oh my god. Is exciting to me.

$385,000. Damn it. This is an amazing year. Oh my god.

What's the vision here in 2026? How many locations today? How many employees?

So, we're left with just one location. So we had about five. COVID killed three. COVID was a beast for short. And, Greenville, I closed that about a year and a half ago after ten years. And now we just have this where we do the classes here. We do cheesecake classes here.

Okay.

And we do some consulting. I'm helping people open their own cheesecake shop. There's a lot of people getting into the business and they think that it's just, well, I'm just gonna bake. I'm just gonna have a great social media presence, and that's gonna bring me the revenue you need. So that's not how it works.

So these aren't people in Dallas that you're teaching to compete with you right down the street? These are people around the country.

Well, this is the only, I believe, possibly the best cheesecake class in the country, and it went viral two years ago, and people just love coming to this class. It's a fun class.

What do you charge for?

It's a $100 a ticket. Okay. And you get to take a mini cheesecake home, and you get two hours of pure fun in here with me. It's dancing, it's laughing, it's jokes. They take the class for the value of knowing the techniques of how to make a cheesecake. Mhmm. But they still know that there's a secret ingredient that I will never reveal because-

What's the secret ingredient?

I cannot.

Yield a little back, which is good. Much revenue do you think you'll do this year in just classes revenue?

40 classes and 40 classes times 12 students. What is that?

About 1,200 per class.

Yeah. Times three. Three. So that's about $40,000 over $50,000 in classes. So we

have three revenue streams. I think we have the classes, we have consulting, we have the actual cheesecake. How much do you think you'll do in consulting?

It's about $95,000 Okay. And then lastly, we have the cheesecake and the cheesecake is very... That is the most temperamental revenue side of it for sure. That's about almost close to $400,000 over 400,000

So that would be a big win for 2026 if you can break $400,000 of revenue.

Yes. My biggest year was 9 and $71,000 That was in twenty nineteen, nineteen, right before COVID.

I mean, guys, you can leave a comment below. COVID impacted a lot of people for Val. It took about half a million bucks a year away in revenue. You just heard the stories. You guys have any crazy COVID stories of him in the comments below, we will follow-up with one of you guys and feature you in the next episode. Val, I see, obviously, you've got, like, many mixers set up. It looks like stations back here. Help me understand how a class would work.

Every pair of student gets a mixer. They have their ingredients laid out. They have their bowls, everything, and they start mixing right then and there. Okay. So we we do have a lot of fun. I think it's more fun than baking. Mhmm. The students come here, and they get their glasses of sangria. All of the cheesecakes that we make in class, they get donated to Women's Shelter or to the stew pot. So the stew pot is a shelter back here.

I love that.

One of the big important things that we do here, we do these glass jars of cheesecake.

And, Rami, what one of these retail for, like, the front window?

So these retail for now at $7. The jar is about 50¢, and then the lid is 12¢.

And what about the ingredients?

It totals out to $2.71 total.

So $2.71, you then retail, you said for 7?

For 7. Yes.

7. Okay. So that's... I mean, are you happy with that margin?

I think it's a great margin for what it is.

So I understand all the margins on this. What's the best way to talk about the full cheesecake The full cheesecake. Process?

Alright. This is a nine inch cheesecake. K. We also do seven inch cheesecakes for sure. This is a smaller one. Ranges of prices vary between 50 and 65.

And how much was the bigger one you just showed us?

Big one varies between 70 and 85 depending on the flavor.

How much will that cost you to make all in?

It costs about $16, 16 to $17.

It costs you about $20. You make about $60 of profit per cheesecake sold. Full cheesecake sold. Correct.

The margins here are a little bit better. It's less work than the jars.

When you compare yourself to other cheesecake manufacturers around the country, small businesses that make cheesecakes, are your margins generally better or worse than theirs? Do you know?

I haven't found a full cheesecakeree in the state of Texas.

Mhmm. Well, you guys know no competition can mean one of two things. It either means Val's are just really unique and he knows something the rest of the world doesn't, or it's a terrible business. That's why no one else does it. You tell me which one you think it is in the comments below.

Oh my god. I believe the reason why people don't choose to do cheesecake, it's a finicky dessert. Like, when you bake it, you can't... You have to let it cool. You have to bake it in a certain way. You know, you have to have the right temperatures and the right moisture content, and that takes time versus a pie. You bake a pie or a cookie, you just put it in the oven and you take it out.

Are there any other expenses I'm not asking about?

Okay. So there are expenses. The lease is about 45, almost to $5,000 a month. We have maintenance. We have pest control. We have our city permits. We have our electricity. We have our gas.

The lease is 4,500 plus other expenses like maintenance, $2, something like $67,000 a month.

Correct.

You think you'll do about 400 or hopefully you'll do about $400,000 a year this year in revenue. What will your all in cost be, do you think?

I think all in cost would would be about 180, $180,000.

How many Instagram followers do you have?

We have about 50,000 followers.

Do they drive real revenue?

Yes. They do. How I know is this is the Elvis cheesecake that is that is posted yesterday. Mhmm. Based on the sale for this Elvis cheesecake, Most of them are seeing, the post online, and they're calling here, and they're reserving. We have about a 100 slices Mhmm. That we bake. We bake 10 whole cheesecakes.

So we're similar other consumer brands that launch unique product, and they sort of... It's like... They they call them drops. You're dropping... Like, it's not a 100 shirts for sale. It's a 100... You know, there's only a 100 slices.

Yes.

Once Elvis is gone, he's gone. You know what I mean? 100 slices. And so that's how that's how the sales happen.

If they sell out, it's from Instagram. Exactly.

Where do you wanna take the business from here? What does 2027 look like?

How do grow? We're in the Cedars here, which is, next to Downtown Dallas. This is a destination spot. You're gonna get in your car, drive to the Cedars to go get Val's Cheesecake because that's where Val is. Alright. So I've noticed that. And next door, there is a spot that is open. I can rent it out as a venue.

How does this have to do with selling more cheesecake?

I can rent it out as venues for people to do their bridal showers, their baby showers, their bar mitzvah. Who's the dessert of chores? It's gonna be cheesecake for sure.

So how much cash do you need to lock down the location next door?

The investment would do... Would would be to expand the brand in terms of, capabilities of pushing out more cheesecakes. It would be nice to have a double stack oven. You know? So those double stack combi oven pipes the water into the oven, and we have a traditional convection oven.

How much does that cost to to purchase that piece of thing that you want?

That that that costs about 25 to $35,000. We're looking about, $60 for extra refrigeration for a better oven as well as electrical power output work.

Okay. Let me think. Do you have right now any other debt on your balance sheet?

I do. I have about $50,000 of debt.

So you have 50,000 of debt What right is the payment schedule currently on that debt? Is it monthly?

The payment is monthly and it's about $900

Okay. And when does it mature? How many months do you have to pay it off?

I believe it matures in 2029.

If the other loan you have is not collateralized by your physical equipment already, I could do a $50,000 loan and say, hey, Val, again, I don't know you. I'm not in Dallas every weekend, but if you miss a payment, I take back the oven, basically. This is called equipment financing. Would you be interested in a structure like that?

I think that would support us. So we're losing time by not having a stronger, more efficient, more sophisticated oven. Having a nice combi oven would help with time and money.

Has the business ever been in a place where the bank is zero and you considered shutting the thing down?

It has never been zero. We've had our struggles. You know? COVID came when I had five location. I was I was driving a specific type of car. I had to return driving? I was driving a Mercedes Class C

You bought... Like buying luxury things?

No. No. Just I wanted a decent car. I've I've I've worked hard, and I wanted a Class C, and I was driving it. I didn't get there. That feels fair to me. COVID came, and I said... I went back to Mercedes. Said, I need to return this. I I need a I need a different car. If I wasn't just counting on money with this business, I would've given up a long time ago.

The reason I do what I do in terms of deals with founders is I want there to be more people building things they love. That means being a founder. And when you go all the way back to 2019 when I did my first deal, fast forward to today, you know, we've ran about $260,000,000 worth of checks and about 700 different founders. And so what's hard for me is I'm never gonna have the deep personal local connection

to every single founder, which means I have to protect myself Yeah. With the paper, with the collateral. But it doesn't mean I don't appreciate the story. I think your story is great. Let me just... Let me make you an offer and get your response. I'd be willing to write a $50,000 check where the use of funds would be for the oven that you want, the refrigeration that you need, and the power upgrade that you really want as well to to make those investments. It'd be collateralized by the actual physical equipment. Okay. Which is nice.

Okay.

Meaning there's no personal guarantee. Okay. I'm not coming after your house if you're late on the payment. And the reason that the collateral is important is when there's a collateral package like that, I can give you cheaper money because I feel more protected. Okay. So the cost of my capital would be something like a 1.3 x refactor rate. What that means is if I give you 50,000 today, over some period of time, you'd pay any 1.3 x 50,000.

Yeah. Okay.

The only question is, how much time do you need to make those payments back? It can't be forever. It also can't be two months.

I'm here forever as a cheesecake baker for sure. So, I think two years.

How much extra revenue will these upgrades enable you to add to the business?

I think that would help us add about $200,000 extra because I know the jars would be quicker, the whole cheesecake would be quicker, and efficiently team... The team would work better.

$50,000. Okay. You pay back 1.3 x of $50,000 on a monthly basis over the next two years. That'll enable you to buy the oven, upgrade refrigeration, upgrade power, and hopefully add $200,000 of revenue to the business. Do we have a deal?

Yes. We do.

We have... That was quick. No no negotiation.

We're not thinking it because we know we can make it.

No negotiation.

No negotiation.

I'm looking forward to working with you.

Alright. Thank you.

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