50 in 50: Arizona

We had no system. We didn’t even know that we’d started a manufacturing company. We just wanted to bake the best brownies in the world and be friends and have a good time... --Eileen Spitalny and David Kravetz, Co-Founders, Fairytale Brownies, Arizona

Fairytale Brownies

Mention Arizona and I’m 13 again. It’s spring break and Dad’s decided to rent an enormous Winnebago--with its airplane-worthy windshield--and drive Mom and five of us kids to the Grand Canyon (my two older brothers stay behind, my two youngest siblings haven’t yet been born). In between stops for gas every 100 miles or so, my siblings and I play card games. Dad finally parks our behemoth vehicle, stands and stretches. “Look, kids,” he says, staring out the window. “Isn’t it something?” We tumble outdoors, stand at the Canyon’s edge. No one talks. I remember light and shadows, pink and purple hues and warm, dry air. At night the stars seem close enough to touch. "Kids, this is paradise."

As I researched Arizona products this week, Dad kept popping into my head. Especially on Wednesday, when Intel Corp. CEO Brian Krzanich announced from the White House that his company will invest $7 billion to complete “Fab 42,” a high-volume factory. Intel says it will be “the most advanced semiconductor factory in the world.” Already the number one employer in Chandler, Arizona, Intel’s new factory will create an additional 3,000 high-skilled, high-paying jobs in that community.

In my prior life--before launching CAMJ--Intel’s announcement would’ve whizzed past me. Yawn. Who cares? But now the wonders of USA-made microprocessors powering data centers and hundreds of millions of smart and connected devices all over the world ranks right up there with the wonders of the Grand Canyon. I’m awestruck. The late great Andy Grove, "Titan of Tech," former COO / CEO of Intel, tireless cheerleader for domestic manufacturing (and, as some may recall, my nominee for Captain America), must be doing cartwheels in heaven. I know this sounds crazy, but I can picture Andy and Dad and other dreamers and makers congregating in heaven, sketching ideas on endless reams of paper.

Here you might ask: what's with the quote at the top of this post? Who are Eileen Spitalny and David Kravetz? What have their melt-in-your-mouth chocolate brownies got to do with microchips?

David Kravetz and Eileen Spitalny, Co-Founders of Fairytale Brownies

Well, Dad used to talk about how we in this country are all interconnected. How if we cut off one appendage--a factory here, another there--unintended negative consequences will follow, eventually affecting everyone. The loss of an Intel factory in Chandler, Arizona, for example, would affect hundreds of other businesses throughout the area, including those in neighboring Phoenix. Intel currently employs 11,300 people in Chandler. These employees and their families need countless goods and services. They need housing, food, medical care, clothing, cars, and furniture. And yes, they need yummy, chocolate treats. Cue Fairytale Brownies.

Founded in 1992, Phoenix-based Fairytale Brownies is now one of the nation’s largest gourmet mail-order brownie and cookie companies, with over 7 million brownies shipped worldwide a year. But in the beginning it was just David and Eileen, two kindergarten buddies, eating David's mom's home-baked chocolate brownies, still warm, at the Kravetz kitchen table after school. The two native Arizonans eventually headed off to colleges in California: David to Stanford to study mechanical engineering and Eileen to University of Southern California (yes, Dad, USC) to study business and Spanish.

After graduating, spending four or five years in their separate corporate worlds and based once again in Arizona, they yearned to be their own bosses. And they loved food. "Food world is fun!" Eileen said in an email. Using David's mom's brownies as their inspiration, they wrote up a business plan, pooled $14,000, quit their respective day jobs, and began baking in a Phoenix area catering kitchen at night. Here's David in an interview with YScouts:

"When we quit our corporate jobs, we didn’t have any wage. And that was for three years. We were full time brownies, no salary for three years. Just living off of savings and family support. Then it took five years for us to be able to pay ourselves back with the same salary we left in the corporate job. It was eight years before the company had a positive net worth. And then it got a little easier and easier after that. But it was really like, five years. And that’s what I tell most entrepreneurs is that it’s usually five years until you’re comfortable to actually pay yourself and not work a million hours a week."

During those first few years--before today's direct-to-consumer / online sales--it was the local community that launched David and Eileen's company. At farmer's markets and various festival food booths, customers snatched up their product and raved about it. They wanted more, they wanted to mail packages of delicious brownies to friends and family and corporate clients. Eileen and David designed mail-safe packaging (now the company has in house designers and all packaging is custom designed) and began shipping product all over the country.

To further get the word out Eileen utilized her marketing expertise, sending samples and press releases to food editors across the country. When Florence Fabricant of the New York Times gave Fairytale Brownies her stamp of approval, phone orders began pouring in. They ran out of brownies and had to ration them out six at a time. That's never happened since. Their hand-made, individually-wrapped brownies--and now cookies--have been featured numerous times on TV news as well as on QVC and The Food Network's "Unwrapped." They currently sell 12 varieties of Fairytale Brownies and 6 flavors of Fairytale Cookies and Fairytale Bars. Every brownie contains dark Callebaut Belgian chocolate, premium Grade AA butter, farm fresh eggs, and fluffy cake flour. I'm getting hungry...

Eileen says the entire journey has been amazing. "We are 25 years old this year as a company and my business partner has been a friend since kindergarten. We have many employees who have worked for us over 10 years. We have 40 employees year round and up to 150 at the holidays; a lot of our seasonal help comes back year after year."

And then she added this: "Fairytale Brownies believes in supporting our local businesses and communities and we give back primarily to KaBOOM! since we met on the kindergarten playground ourselves. Unstructured play is where it is at for kids and adults so our brains can create and think of the impossible. We didn’t know how to bake, we just wanted to be our own boss and create a brand."

By the way, KaBOOM! is a national nonprofit "dedicated to bringing balanced and active play into the lives of all kids." Since 2001, Fairytale Brownies has contributed more than $200,000, thousands of brownies and cookies, and countless hours volunteering, fundraising and donating for playground builds. In 2011, they built a playground for an elementary charter school that serves the homeless and under served. They will build another playground in Spring 2017.

It's fun to picture Eileen and David as little kids on the playground, pretending, letting their imaginations carry them away. They always say their Fairytale Brownies have a "dash of magic" in them.

Interesting that Intel says magic plays a part of its process too: "A leading-edge computer chip is the most complex manufacturing process in the world, engineering magic that turns sand into semiconductors, the foundation of the knowledge economy." Bet some of that "magic" began for Intel engineers as it did for Eileen and David, during trips to the park as kids, free to dig in the sand and think.

If they haven't already, Intel's Brian Krzanich and Fairytale Brownies' David Kravetz and Eileen Spitalny should definitely meet-up, swap stories of magic and invention and microchips and chocolate chips and discuss how, in the great state of Arizona--and in the USA--anything's possible.

Next up: Arkansas