Manlius native turns class project into business

CNY Business Journal (1996+), Apr 27, 2007 by Acton, Ryann

POTSDAM - Lisa Gorczyca, 18, is emerging from her freshman year at Clarkson University as an entrepreneur.

Gorczyca, with the assistance of 28 of her classmates, founded Piece of Cake as a project for Clarkson's entrepreneurship-management organization class. The gourmet-dessert shop opened in January and will close in late April for the summer.

However, unlike most startups formed in the class, Piece of Cake is not shutting its doors permanently when the school year ends.

The dessert shop is relocating, expanding its hours and products, and hiring employees for its re-opening in the fall.

Clarkson's year-long class, entrepreneurship-management organization, requires freshmen to create a business, design a business plan, present the plan to venture capitalists to receive funding, and successfully run the business until the conclusion of the spring semester.

"We really want the students to understand the basic, fundamental concepts that make businesses work," says Marc Compeau, Clarkson's director of entrepreneurial programs.

Only three of the 30 businesses started in the class's history have continued after the class was over, Compeau says.

Challenges

Piece of Cake was not the class's first idea. Gorczyca - a Manlius native, and a business and psychology major - tried to find an untapped food market at Clarkson University. That proved difficult, she says. The university has everything, she says.

Gorczyca discovered something Clarkson was not serving its students - warm smoothies - perhaps for good reason. Gorczyca and some classmates whipped up a batch and tested them in focus groups, but the warm smoothies failed to entice consumers.

"They were horrible," she says.

The class ditched the warm-smoothie concept and discovered students with a sophisticated sweet tooth could not buy gourmet cakes, pies, or chocolate on campus. Students craving anything more than ice cream or cookies had to drive off campus to buy it - not convenient for students without cars, Gorczyca contends.

Health-regulation compliance was another hurdle for the class.

Many class startups shy away from food businesses because compliance with Health Department codes can be difficult, Compeau says.

"With health regulations, what were we thinking?" Gorczyca quip.

However, Piece of Cake persevered, Compeau says.

Piece of Cake partnered with Scoopuccinos, a Potsdam gourmet bakery; St. Lawrence Chocolates, a Potsdam candy shop; and Aramark, Clarkson's food-service vendor.

I was just in high school last year. I didn't even know what I was doing was called supply-chain management," Gorczyca says.

Piece of Cake distributes Scoopuccinos' desserts and St. Lawrence Chocolates' candy, thus reducing the regulatory burden of complying with health codes for cooking food. Aramark provided Piece of Cake with retail. space in the university's Cheel Arena complex, oversight with health regulations, and assistance with food storage and cleanup.

Sweet success

Piece of Cake's business plan impressed a panel of venture capitalists, also Clarkson alumni, responsible for judging the plans. Upon the panel's recommendations, Clarkson's New Venture Development Fund offers venture capital to student businesses.

The fund, which currently contains $30,000, typically offers startups between $2,000 and $5,000, Compeau says. Piece of Cake received $3,500 in venture-capital funds - $1,000 more than the students requested - to expand their idea to offer delivery services. Piece of Cake now delivers cakes.

Piece of Cake opened just three months ago, and has generated about $4,850 in sales and $1,250 in profit, Gorczyca says. Piece of Cake used its revenue to pay the New Venture Development Fund back, she adds. The shop employed 29 unpaid staffers, the entire class. Gorczyca served as the general manager, overseeing store operations, including contacting suppliers and training employees.

Gorczyca and three of her classmates - Carolyn Roth, Brian Senesac, and Ryan Cerone - decided they wanted to continue Piece of Cake. They purchased Piece of Cake for $600 - $150 each, sharing equal ownership, Gorczyca says.

They've begun plans to relocate Piece of Cake for the fall semester.

Timothy Sugrue, dean of the School of Business, has offered Piece of Cake its own facility on the first floor of Snell Hall to sell gourmet coffee and dessert. The 120-square-foot location, with heavy foot traffic from students and professors, is ideal, Gorczyca says. Paid work-study students will staff Piece of Cake.

Gorczyca, Roth, Senesac, Cerone, and Sugrue are currently in contract negotiations on the Snell Hall site. Gorczyca expected them to be completed at the end of this week. This his is a step up from its previous location in the Cheel Arena complex - a Panini stand by day and a gourmet dessert shop by night. Having work-study students and its own facility will also allow the shop to remain open during busy morning hours, Gorczyca says. She forecasts revenue to increase 30 percent.

With the new location, Gorczyca also hopes to expand the shop's menu to include soft-serve ice cream, she says. She is also interested in purchasing a barista machine to make cappuccino and lattes.