Sprinkles founder Candace Nelson traces her career path from corporate America to 'Queen of Cupcakes'

Candace Nelson is a serial entrepreneur, TV personality, author, and investor who shared her path to “Sweet Success” with attendees of CREATE: The Event for Emerging Restaurateurs.

The founder of Sprinkles, and thus arguably the catalyst for the ongoing cupcake trend, and owner of an artisanal pizza concept called Pizzana, Nelson has been her own brand ambassador as well as entrepreneur. She was dubbed the Queen of Cupcakes on the Food Network show Cupcake Wars, where she was a judge, has appeared as a guest “shark” on the reality TV show Shark Tank, and is in the Netflix series “Sugar Rush.”

“Sweet Success: A Simple Recipe to Turn your Passion into Profit” is her best-selling book, which she gave to conference attendees while discussing her journey with Nation’s Restaurant News editor-in-chief Sam Oches.

She said she got the baking bug as a kid, but the entrepreneurial bug came later because, apart from Mrs. Fields, she didn’t have any role models growing up. Her father was a corporate attorney, so he was all about risk mitigation, which is essentially the opposite of entrepreneurship, and Nelson herself started her professional life doing financial analysis for an investment bank in San Francisco, thinking, “Oh my god, there’s got to be more to life than this.”

She went on to work in tech during the dot-com boom of the 1990s, which as we all know eventually went bust. Without a job or prospects for a new one, she said it felt like she’d been “sold a bill of goods,” having followed the rules for success in corporate America that ultimately didn’t get her anywhere.

So she went to pastry school and rekindled her love for baking, not necessarily knowing what she was going to do with a pastry degree.

“I was just following my joy,” she said, and quickly realized that was a whole lot better than crunching numbers.

Nelson developed a reputation for making great cakes for her friends, and started making custom-decorated special occasion cakes out of her home, which she said was very artful, “ and a huge pain in the butt.”

But “that business brain of mine hadn’t shut off,” she said, and had an epiphany in the bakery section of a grocery store staring at cupcakes in plastic clamshells.

“I just thought, these cupcakes look kind of sad,” she said, and the inspiration for Sprinkles was born.

It took a couple of years to “reinvent the cupcake,” which at that point were mostly mass-produced and uninspiring.

“They were kind of the ‘fast fashion’ of the baking world, and I wanted to make mine ‘haute-couture.’”

She used premium ingredients for her cupcakes, and also reimagined the look, starting with the frosting. Rather than piping on thick gobs of it, she hand-frosted them, which made them look more artisanal and also resulted in a better frosting-to-cake ratio.

She added a double dot made of sugar that became her product’s signature look (and which is also trademarked), and the Sprinkles cupcake was born.

She debuted her one-item business at the height of the low-carb craze at what was possibly its epicenter, Beverly Hills, Calif.

“Nobody thought this idea would work,” she said, but driving around Los Angeles she realized that there were a lot of doughnut shops and burger places, and she realized that despite the low-carb talk, there was a place in people’s hearts and stomachs for starch.

She figured that if she made the cupcakes worth the calories, “people would make the splurge.”

And she was right.

“We had a line out the door since day one,” she said.

In fact they sold out of cupcakes before noon.

She and her husband Charles had no restaurant experience; Nelson hadn’t even interned during pastry school.

“We had to build the plane as we were flying it,” she said.

And they had to do it as business was booming. The Beverly Hills location was near many talent agencies, and actress Katie Holmes became a fan and was talking about it just as Tom Cruise was pursuing her romantically, causing a media frenzy of people wanting to talk to her.

To curry favor, the media would bring Sprinkles to her to try to score an interview.

Soon other celebrities became fans, and the concept grew. The cupcakes became favorite gifts among Angelenos, assisted by Nelson designing gift boxes that resembled those in which roses were delivered and making premium cupcakes that were gift-worthy.

A second Sprinkles opened in Newport Beach, Calif., and then she opened her third location in Dallas, which Nelson said was “very strategic,” convincing people that it wasn’t just a Southern California phenomenon but could work anywhere.

Her role in Cupcake Wars, and the fact that people love cupcakes, meant word-of-mouth preceded their openings in new markets; the demand was there before they opened.

As the company grew, she said she was concerned that she didn’t have actual industry experience and thought maybe she should hire industry veterans to help.

“I think it took me awhile to grow into the idea of being a leader and grow into my own power,” she said.

“The irony is once we had the money to hire someone with that pedigree, they came into Sprinkles and they stuck out like a sore thumb,” she said. They didn’t fit Sprinkles’ entrepreneurial style, and she realized she had developed an “awesome, unique, corporate culture.”

Eight or nine years in, she sold Sprinkles to private equity firm KarpReilly, and then didn’t know what to do with herself.

“You actually thrive on getting up every day and solving problems,” she said. “That hustler part of you never goes away.”

“That next opportunity actually found me,” she said.  

She was at a neighbor’s party and took a bite of pizza that had the best aspects of Neapolitan pies, but without being soggy in the middle. She met the chef, Daniele Udit.

“I could just see the brand that I could build around him,” and the first Pizzana opened in Brentwood, Calif.

It has since grown to seven locations, five in Los Angeles, one in Dallas, and one in Houston.

“We are elevating a simple food at Sprinkles and Pizzana, but that’s where the similarities end,” she said. Sprinkles is a 5-minute transaction (or less at the chain’s revolutionary cupcake ATMs), and Pizzana is a full-service restaurant.

“But the biggest difference is we have some experience, so realtors aren’t hanging up on us when we call,” she said. She also now has good supplier relationships and veteran staff: Three of her original Sprinkles employees now work for Pizzana.

She’s launching an app and loyalty program for Pizzana, called “Cacio Club,” and looking to expand while also looking for new investments.

CN2 Ventures is her investment company, and she’s looking for companies for which she has a personal affinity, and she said she also has to like the founders.

Also, “they have to be really good at selling, because there’s no time in business when you’re not selling,” she said.

Contact Bret Thorn at [email protected]