It’s been a tumultuous week for kosher cupcake lovers.
First came the news that Crumbs Bake Shop, the New York-based cupcake empire with 48 stores nationwide, was closing down: “Regrettably Crumbs has been forced to cease operations and is immediately attending to the dislocation of its devoted employees while it evaluates its limited remaining options,” a company spokeswoman told The Wall Street Journal on Monday. It seemed likely the kosher chain, which went public in 2011, would file for bankruptcy.
But now it looks like there might be a reprieve for Crumbs. The New York Times’ Dealbook reports that the company “was said to be close to securing financing from a group of investors,” which includes Fischer Enterprises (rescuer of Dippin’ Dots), and Marcus Lemonis, CEO of Camping World (and star of reality TV show The Profit).
Founded in 2003 by husband and wife duo Jason and Mia Bauer, Crumbs rode the cupcake craze from a single shop on the Upper West Side to dozens of stores across the country. Unfortunately, the chain began an aggressive expansion plan in 2011 (aiming for 200 outlets) just as the market became saturated and consumer demand for cupcakes began to decline. According to The Wall Street Journal, “Crumbs posted a loss of $18.2 million last year, layered on a loss of $10.3 million in 2012, according to securities filings. Its cash on hand fell to $893,000 at the end of 2013, down from $6.3 million the prior year.” Ouf.
For the sake of kosher cupcake mavens nationwide—and more importantly, Crumbs’ 820 employees—we hope the deal comes through.