Pandemic entrepreneurs

MARY REICHARD, HOST: It’s Tuesday the 2nd of November, 2021.

Glad to have you along for today’s edition of The World and Everything in It. Good morning, I’m Mary Reichard.

NICK EICHER, HOST: And I’m Nick Eicher. First up: changes in the workforce.

We’ve heard a lot about pressures on the labor market, with a shortage of workers, demands for higher wages, and the problem of rising prices. But, now, a potential positive trend: a burgeoning number of new businesses. WORLD senior correspondent Katie Gaultney reports on the surge in startups.

KATIE GAULTNEY, REPORTER: This beige, brick warehouse sits on a busy Dallas street. The 4,000-square-foot rectangle conceals a feast for the senses inside.

AUDIO: [Sound of a door opening, mixers]

The tantalizing smell of warm butter fills Color My Cookie’s headquarters. Ovens and coolers hum, mixers whir, and half a dozen cookie decorators deftly pipe royal icing onto giant trays of whimsical shortbreads. This hubbub of delicious activity has been a labor of love for husband-wife team Sam and Nancy Major.

MAJOR: Before we got married, he said he wanted to have boys and girls and a bakery.

Sam is a classically trained pastry chef. Nancy is a lawyer. The girls came, then the boys, and finally, in 2016, the couple bought a bakery. But what looked at first like a dream come true felt at times like a nightmare over the next four years.

MAJOR: There were definitely periods when one of us would work 24 hours a day. Like he would get in bed two in the morning and I would literally get out of bed and work until the kids woke up...

Then, the pandemic hit, and the bakery had to shutter.

MAJOR: That was a real low point for us and we had lots of financial commitments, including our four children. And we just had to kind of regroup.

They came up with a business that would give them back nights, weekends, and family time: shipping sets of paintable, iced shortbread cookies.

MAJOR: When you receive your cookie kit, you receive this palette-shaped cookie and a paintbrush, and then you wet your paintbrush to activate the edible color dots. And you can paint your cookie…

Customers love the product, and Nancy no longer has to spring out of bed in the middle of the night to fulfill bakery orders or fix a hiccup.

MAJORS: We have the capacity to be so much more flexible than we had when we were a custom bakery.

The Majors are part of an economic trend Scott Pearson’s had his eye on since the start of the COVID-19 era. Pearson is a business owner and professor at Palm Beach Atlantic University.

PEARSON: People have been rethinking their lives and some people have found opportunities in starting their own businesses, because they think that that's going to give them more of the lifestyle that they really want.

In 2020, U.S. entrepreneurs created 4.4 million new businesses. That’s nearly a 25 percent increase over the previous year.

PEARSON: Obviously you've had a lot of people put out of work, a lot of businesses that didn't survive during this time. And that's put a lot of people into situations where they have to find a new alternative.

The Majors represent an adaptation economists are seeing in the workforce: taking business online-only. Pearson said it’s not a coincidence that the Roaring 20s followed the Spanish Flu of 1918.

PEARSON: You're going to see a lot of older businesses that haven't adapted, that haven't changed, that haven't moved with the times that are going to be in decline, but you're going to see newer businesses taking on new leadership and growing faster than anything you've ever seen.

And early data indicate a particular surge in women- and minority-led startups. But, online or in-person, getting a startup off the ground is a grind.

AUDIO: [Sound of smoker running]

Across Dallas, more good smells. This time, coming from a home garage-turned-smokehouse.

STROUD: We cook in this chamber smoker. We use pecan only…

That’s Matt Stroud. He’s been a meat-smoking hobbyist for as long as he can remember, taught by his dad. When the pandemic hit, his full-time job as an oil and gas pipeline welder went up in—well, smoke.

STROUD: It basically went to a stop and with a snap of a finger, there were 3,500 welders and laborers that just lost their job.

Then a woman on a neighborhood Facebook group asked where she could find a smoked turkey. Matt’s wife, Trisha, a homeschooling mom of two, responded.

STROUD: And I was like, “Hey, we're going to smoke one for us in our family. I could put a couple on there.” Thirty-two orders later…

They made it a weekly thing, delivering smoked meats, sides, and homemade barbecue sauce in their neighborhood. There was a learning curve: filing for an LLC, along with all the regulations around food handling. They’re still fine-tuning their processes as they go, things like order intake and customer service. They call their meal delivery business Strouderosa. As with Color My Cookie, the loyal and enthusiastic fan base grew quickly.

STROUD: We run between 10 briskets and 15 briskets at a time, 72 racks of ribs. We can put about 400 pounds of chicken on there. And then pork butts, we get about 24 pork butts in there…

But, unlike Color My Cookie, Strouderosa can’t scale up—yet. It’s limited by the size of the small, detached garage that can only hold so many smokers and commercial fridges and freezers. They’re trying to find their own restaurant space to set up shop, but over and over, they’re coming up empty-handed.

STROUD: We can take a step forward and 10 steps back in a day. If you fight hard for a goal, it's going to happen, but man does life put you down in the middle of it, and it gets rough.

The Strouds are hopeful they can begin to make enough income from Strouderosa to keep Matt from having to return to the oilfield.

Scott Pearson says some experts will tell you 90 percent of new businesses fail within the first two years. But failures often pave the way for the best entrepreneurs. The key is learning to “fail fast.”

PEARSON: You have a lot of first-time entrepreneurs probably coming into the market at this point in time. And I think they need to hear it's okay to fail. It's okay to discover that you made mistakes. The key is not to dwell on that. The key is to pick up, dust yourself off, and move on to the next thing—and do that quickly.

Reporting for WORLD, I’m Katie Gaultney in Dallas, Texas.

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