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From a Garage Oven to a Full-Blown Restaurant: Seller Spotlight on Zak the Baker

Square
Editorial Team

For five years, Zak H. Stern worked as a bread- and cheese-making apprentice, traveling from Sweden to Israel to hone his craft. Three years ago, he landed in Miami and decided it was the place to set up his own business.

He started small with just an oven in his garage and some goats in his backyard. He began selling his bread at local farmers markets, where, eventually, his products caught the attention of local restaurants and big brands like Whole Foods.

Fast-forward to now and Zak — better known as Zak the Baker — owns an always-packed cafe in Miami’s hip Wynwood Arts District. His business has grown from three employees to 45, and with recent Square Capital financing, it’s expanding into a full-blown restaurant.

We recently checked in with him to see how everything’s going:

Square: Tell us about your cafe — what’s unique about the space?
Stern: It’s a 2,000-square-foot space that was originally just supposed to be a bakery and showroom: a place where the community could engage with the process by watching us make bread. However, we soon saw the demand to serve what we were making and turned it into a cafe. And we’re still transforming. In the span of a year, we went from having about three employees to over 45, and from a small cafe with a few items on the menu to a full-on restaurant. But even though we’ve grown, it still has that startup feel. We’re here for more than just the profits. There’s a greater purpose here, which is continuing the tradition of craftsmanship.

How did you think about financing your expansion? Did you look into lots of options?
There were a few options for raising capital, but most of them didn’t fit our needs. I didn’t want to offer equity because I wasn’t interested in giving a piece of the business to others who don’t work with us. I didn’t want to take out a traditional loan, either, because it was a very complicated process and I wanted funds to be easier to obtain. When it came to Square Capital, I literally just got an email. It was clean and easy.

Why else was Square Capital the best fit?
Square Capital has allowed us independence in not having to take investors. This way we can keep this place 100% mom and pop, which helps us satisfy our purpose over profitability. Profits obviously keep us alive and breathing, but we don’t just live to breathe –– we’re focused on our purpose. But it’s hard to feel like you’re being held back by financial issues and the depth of your pockets. Square Capital is making me put my money where my mouth is and say, “No more excuses, let’s knock it out of the park.”

What sorts of things are you using the money for?
We’re evolving from a cafe to a full-on restaurant. To do this, we’re adding a hot line –– a gas burner, fryer, griddle, and new oven. This will allow us to grill more fish and protein, press more sandwiches, and make more pasta, which is usually one of our daily specials. We’re also going to replace chairs and countertops. Basically, we’re using it on all the little details that create an atmosphere and make a place wonderful.

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How do you plan to approach this next phase of your business?
Once we hit 45 employees and things got really busy, we were forced to ask ourselves that question. The first thing we realized is that we’re committed to being independent, which allows us to bake the best possible bread without having to compromise anything to satisfy an investor.

Secondly, we are committed to integrity of the craft and keeping it alive. The third is making a connection between consumer and producer. I feel like as time goes on, the distance between the two is getting wider and wider. That’s why we put our food production in an art gallery setting, so people can view it as performance art and are able to participate without having to spend a dime. These things are typically done out of sight in an industrial zone where land is cheap and you can mass produce. When people come into our shop, there’s no “back of the house” and you can see what we’re doing.

I think making loaves of bread is a beautiful process, and by allowing people to see it, it helps make that connection we’re committed to making. The renovated space will have the same mindset –– there’s going to be bread with a retail element, where people can come sit and watch bread and pastries be made and really feel connected to the craft.

What advice would you give other business owners about knowing when the time is right to accept financing and expand?
From my experience, I would say to have patience and wait until you’ve really hit a point where you can’t continue any further. We have 2,000 square feet of space, a wholesale bakery running 24 hours a day, a retail cafe that is full every moment with lines out the door, catering and wholesale programs, and different events we host. Every square inch of our space is productive and maxed out. I think waiting until it’s absolutely necessary is valuable because it builds character to work in a difficult position.

For us, we asked ourselves how we could balance meeting the demands of the market with keeping the integrity of the craft. Part of our main mission is to make great bread with integrity and joy. When we make a big decision, such as whether or not to renovate, we ask ourselves if these two parameters are kept. If they are, then we say “okay” and go for it.

Learn more about Square Capital.

The Square Editorial Team is dedicated to telling stories of business, for business owners. Our team comes from a variety of backgrounds and share a passion for providing information that helps businesses to start, run, and grow. The team is based in San Francisco, but has collaborators all over the country.