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HomeMy WebLinkAbout[05] Revolving Loan Fund RequestEDA Agenda Item 5 CITY OF ST. JOSEPH MEETING DATE: June 16, 2020 AGENDA ITEM: Revolving Loan Request — Jupiter Moon Ice Cream SUBMITTED BY: Finance/Community Development STAFF RECOMMENDATION: The Finance Committee met to review the RLF loan application on June 9' and support the issuance of the loan. PREVIOUS BOARD ACTION: BACKGROUND INFORMATION: Jupiter Moon Ice Cream submitted a loan application to remodel the old Bad Habit Brewery space in 15 Minnesota St E, Suite 108. The remodel includes purchasing the necessary equipment to operate an ice cream shop. The estimated project costs total $152,000. Jupiter Moon Ice Cream has a loan application with SBA in the amount of $142,000 leaving a gap in financing of $10,000. The loan application is for $10,000 to be paid back over 5 years at 3% interest rate. Staff will provide a background on the business plan at the meeting. David Boyer, applicant, may also be present to go through his business model and request. The Finance Committee recommends approval of the $10,000 loan. The funds are available in the RLF fund 250. The loan will be secured by equipment collateral and a personal guarantee by Mr. Boyer. The closing cost is 1 % of the loan ($100) to cover drafting the loan documents and filing fees. The business encourages downtown visitors, compliments other business activity in the area, adds four to eight j obs to St. Joseph in the first year, and fills a vacant end cap of the Millstream Shops and Lofts building. If the EDA recommends approval, the City Council will be the final approval of the loan at their next meeting. BUDGET/FISCAL IMPACT: ATTACHMENTS: $10,000 RLF Loan Jupiter Moon Ice Cream Business Plan REQUESTED BOARD ACTION: Kindly consider recommending approval for the Revolving Loan to Jupiter Moon Ice Cream in the amount of $10,000 to pay paid over five years at 3% interest rate. Business Plan Narrative Jupiter Moon Ice Cream June 2020 Prepared by: David Boyer �V�'1 Jupiter Moon Ice Cream Business Plan page 1 V200603 Q7VT I LE?p 9a Problem worth solving Jupiter Moon serves up small -batch, hand-crafted ice cream with a mission of community connectedness through the joy of ice cream. OUR OPPORTUNITY Our Solution There is no locally produced, small -batch ice Though we do love ice cream, it's not the real reason cream in the area. Further, there is a lack of we do what we do. Jupiter Moon is built on a love and spaces that are inclusive, and welcoming where desire for community and relationships. In short, joy and celebration are the focus. Jupiter Moon is all about people and the shared joy of ice cream. Target Market t Families with Young Children 2. College Students 3. Foodies who want high-quality 4. Teenagers 5. People with nut allergies Competitors How our solution is better Grilled Cravings & Quality Ice Cream Cold Stone Community centric, Better Creamery Quality Dairy Queen Quality Mr. Twisty Quality FUNDING NEEDED Ice Cream Production Equipment, Building Renovation, Working Capital, Inventory Startup (gVTILEAD Jupiter Moon Ice Cream Business Plan page 2 MOON V200603 General Information David Boyer - Owner • 320-266-4877 • david@jupitermoonicecream.com Current Mailing Address: 612 5th Ave N Sauk Rapids, MN 56379 Executive Overview Proposed Retail Site Address: 15 E Minnesota Street Unit 108 St. Joseph, MN 56374 Jupiter Moon Ice Cream is an artisan ice cream company currently located in Sauk Rapids, Minnesota owned by David Boyer. Jupiter Moon is dedicated to finding the best ingredients, making the best ice cream, and bringing the community together through the wonder and celebration of ice cream. All ice creams are hand-crafted in small batches using as much as possible, local and sustainable ingredients. Problem worth solving You're craving a treat and want to indulge, celebrate or just plain smile. Where do you go that will guarantee a bit of joy, a smile, and community connection - Jupiter Moon of course, for some ice cream. Jupiter Moon Solution Jupiter Moon offers locally -made, hand-crafted, artisan ice cream and in an iconic and celebratory environment that embraces the community. It's hard to beat a fresh scoop of espresso coffee or lemon c7YTI�EI [^i Jupiter Moon Ice Cream Business Plan page 3 �0 ON V200603 poppy seed ice cream (personal favorites) in a fresh waffle cone or something as simple as the pure flavors of vanilla bean with a honey drizzle. We love ice cream! Our Advantage As tasty as ice cream is, the real appeal and what appeals to us profoundly, is that ice cream brings people together, almost always in celebration. Creating an inclusive, welcoming space where joy and celebration are first and foremost is driving this dream. We want to create an icon for central Minnesota. A place where first dates happen, big wins are celebrated, summer nights savored, and smiles abound. That is our advantage. Target Market The market that Jupiter Moon will engage is the central Minnesota area, including the cities of St. Cloud, Sauk Rapids, Sartell, Waite Park, St. Joseph, and Collegeville. The specific location of the scoop is downtown St. Joseph, located eight miles west of downtown St. Cloud. St. Joseph is a college town with College of St. Benedict's a block away and St. John's University nearby in Collegeville. People are drawn to St. Joseph because it is a vibrant community accented with multiple restaurants, a popular brewery, a cider house, a coffee shop, quaint shops, the trailhead for the Lake Wobegon Trail, urban housing, and of course, the lively college atmosphere. Further, St. Joseph hosts a number of large community events such as JoeTown Rock and Millstream Art Festival that draw thousands of people. Our target audience will be families with children, college students, and visitors to the St. Joseph area who consider it a destination city. Many of those will come from St. Cloud. The downtown location and increasing customer base will probably also draw in customers outside of our targeted groups, including those attending the Friday Farmers market, the large number of church attendees, as well as the frequent and popular community events. (gUTITEA §� Jupiter Moon Ice Cream Business Plan page 4 Z00x V200603 History of The Business On May 18, 2019 Jupiter Moon Ice Cream opened for business selling prepackaged cups from an ice cream tricycle. In 2019, nearly 5000 cups of ice cream were sold at over 40 events. Each cup of ice cream was made by the Jupiter Moon team and individually hand packed. -F -- -! ICE CREAM t f __ Over 30 ice cream flavors have been developed with Salted Caramel with Truffles, Dark Side of Moon, and Lemon Poppy Seed becoming signature flavors. In addition, the dairy -free, vegan offerings including Key Lime Coconut and Spicy Mango Coconut accounted for a significant portion of sales. Jupiter Moon has developed a strong and enthusiastic customer base that we look forward to connecting with at events, sharing in the joy that ice cream brings. The demand for high quality, locally made ice cream (YTILEA 1 Jupiter Moon Ice Cream Business Plan page 5 � V200603 with unique flavors is strong and so is the authentic interaction and joy that Jupiter Moon Ice Cream has become known for. In addition, all of Jupiter Moon ice cream is free of peanuts and true tree nuts (walnuts, cashews, almonds, etc.) We will continue to be nut free, offering a dessert option for those with nut allergies who often have to go without at other establishments. Alliances Jupiter Moon has curated close alliances with other ice cream shops across the country through the National Ice Cream Retailers Association (NICRA), https://www.nicra.org. Mentorships established with Layla Isaac of Ice Cream Social, https://www.icecreamsocialtacoma.com and Don Lambert of The Colonel's Creamy, http://thecolonelscreameru.com have been particularly valuable. In 2018 and 2019, Jupiter Moon attended the NICRA conventions with talks and courses on food safety, ice cream production, scoop shop management. In January 2020, David traveled to Tacoma, WA to visit the Ice Cream Social scoop to shadow and learn about the day to day running of a brick and mortar ice cream business. Currently, Jupiter Moon is also working with Craig Hanson with Hanson Law Office, PA http://hanlawoffice.com/. Further, Berny Berger from the St. Cloud Small Business Development Center, https:I/www.stcloudstate.edu/sbdcl is providing guidance and assistance. Many thanks to Berny! Her help and support has been essential. (?7y ITE( C1 Jupiter Moon Ice Cream Business Plan page 6 00 V200603 Menu • Chocolate • Strawberry o Dark Side of The Moon o Strawberry Banana o Aztec Chocolate o Strawberry Basil o Dark Chocolate Mint • Raspberry o Chocolate Marshmallow - Milky Way • Peach o Milk Chocolate • Spicy Mango Coconut (Vegan) o Choco-Coconut (Vegan) • Key Lime Coconut (Vegan) • Vanilla • Lemon o Vanilla Bean o Lemon Poppy Seed o Cherry Vanilla o Sun Lemon Kiss (Vegan) o Vanilla Honey Lavender • Blueberry • Coffee o Blueberry o Espresso Coffee o Honey Blueberry Lavender o Mocha Chip • Mint o ON It's Strong! Irish Coffee o Mint Chip • Salted Caramel with Truffles o Garden Mint • Root Beer Float • Banana • Cookies & Cream o Roasted Banana • Cinnamon Apple Pie o Banana Chocolate Chunk • Basil Pine Nut • Green Tea • Ginger Snap Cookie • Saturday Morning Cartoons • Fire Stick Cinnamon • Purple Reign • Orange Dreamsicle • Flamingos in Space • Space Junk Location The Jupiter Moon scoop shop will be located in the downtown of St. Joseph. College of Saint Benedict is located two blocks away and St. John's University is nearby in Collegeville. centric St. Cloud, a city of 70,000 located eight miles away. St. Joseph is a vibrant community with a strong small business T�l'1 Jupiter Moon Ice Cream Business Plan page 7 vv .,0 v V200603 environment. Downtown is pedestrian centric Jupiter Moon will be located near a coffee shop, pizza restaurants, Italian restaurant, brewery, as well as urban housing. Facilities uu L;.dJf& S The Jupiter Moon scoop shop will be in the end unit on the east of the Mill Stream Shops, htt www.millstreamsho s.com , The building previously held Bad Habit Brewery, which rapidly out grew the space and is now located nearby in a larger facility. Since the space was a brewery before with a food production area and restaurant setting, it is very nearly turn -key for an ice cream shop. Build out will be minimal with construction essentially limited to new counters suitable for ice cream service, a wall in the production area, minor plumbing and electrics and cosmetic upgrades of new paint and lighting fixtures. In addition, a walk-up window will be added, allowing for ordering without having to come into the store. The space also has access to outdoor seating via a roll up door which will be very valuable and popular during the warm summer months. The Jupiter Moon scoop shop will be handicap accessible via a ramp. (UYIILEA 5 1 Jupiter Moon Ice Cream Business Plan page $ IIA00 V200603 a The space is very visible from Minnesota street which is the main road through downtown. Jupiter Moon and the signage will be easily seen by traffic and pedestrians. Ample free parking is available on the street in front of the store on both sides of the road. Split and Sublease Potential The space is approximately 1800 square feet and could be divided for a separate small, -250 sq foot retail space. Currently, there are not formal agreements in place to do this, however, we are actively searching for a coffee company, cupcakes, or similar business that would be a good partner to ice cream. If a good fit can be found, dividing the space is highly likely which would lower Jupiter Moon's rental burden as well as provide a synergy between businesses. (gull ITEAD Jupiter Moon Ice Cream Business Plan page 9 X00 V200603 Competitors Grilled Cravings and Ice Cream Cold Stone Creamery Mr. Twisty Cherry Berry Dairy Queen Fudgin' Delicious Ice Cream Fast Food Soft Serve (gVTIrEA1 Jupiter Moon Ice Cream Business Plan page 10 j�0 V200603 Current alternatives Currently, there is not an option for locally produced, artisan, hand-crafted ice cream in central Minnesota. Further, there is not a traditional scoop shop. The closest ones are located in the Twin Cities. Within St. Joseph, the direct competitor is Grilled Cravings and Ice Cream. They offer hot food as well as ice cream. Jupiter Moon would have a much more visible location right in downtown offering locally produced premium ice cream with more unique and ever changing flavors. Cold Stone Creamery and Fudgin' Delicious Ice Cream are located a few miles away in St. Cloud. Cold Stone has two locations, St. Cloud and Sartell. Fudgin' Delicious Ice Cream is located inside the Crossroads Mall. Each offers a different experience than Jupiter Moon. Cold Stone Ice Cream is a national chain that has little community connection and average quality ice cream. The focus is mixins and blending of ice creams. In contrast, Jupiter Moon will focus on producing premium ice cream that stands by itself made with high quality ingredients that if possible, can be locally sourced. Fudgin' Delicious Ice Cream offers premium ice cream made by the Chocolate Shoppe Ice Cream Company based out of Madison, WI. The quality of their ice cream is high and similar to what Jupiter Moon offers. However, the mall experience of Fudgin' Delicious offers is completely different from the outdoor, main street experience that Jupiter Moon will offer and is appealing to a different clientele. Other competitors in the area feature soft -serve, frozen yogurt, and fast food. Dairy Queen is the most unbigquotous and has significant brand recognition. There are locations in St. Cloud and Sauk Rapids. Mr. Twisty is in north St. Cloud and is a locally owned soft serve establishment that is similar to Dairy Queen in its offerings. Cherry Berry features self -serve frozen yogurt and is located on the west side of St. Cloud. Jupiter Moon offers a different and higher quality product and a more inclusive environment with indoor and outdoor seating. (?JVA"� Jupiter Moon Ice Cream Business Plan V200603 page 11 Ownership Structure Jupiter Moon Ice Cream is a LLC with David Boyer currently as the sole owner. Eric Falk is an investor contributing via sweat equity. The summer of 2020 he will be working as a store and production manager. His investment is estimated at $14,000 in labor effort. Management Team David Boyer* - Owner • Eric Falk - Investor • Christine Metcalf* - Restaurant Manager *Certified Food Safety Manager David and Eric ran Jupiter Moon in 2018, where sales and production was focused on selling Jupiter Moon ice cream packaged into single and double serving cups. The majority of sales were from events and catering with prepackaged ice cream cups sold from the Jupiter Moon ice cream tricycle. OYT Ir AD Jupiter Moon Ice Cream Business Plan page 12 'lul E V200603 Christine Metcalf assisted in the production and packaging of ice cream as well as sales. Her restaurant and kitchen experience as a previous co-owner of Waldo's Pizza proved to be invaluable to the success of Jupiter Moon. David has a science background which he has parlayed into culinary experimentation. He believes the chemistry of ice cream is fascinating and new flavor development is always happening. Further, he loves the power of ice cream and how it can bring the community together. c7'UTIrER 5% Jupiter Moon Ice Cream Business Plan page 13 M00N V200603