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How a brand new 27-year-old CEO plans to restore fro-yo craze at 16 Handles

If a dismal haired guy is piling a mound of chocolate chips and coconut flakes atop your Chocolicious fro-yo on the 16 Handles in Instances Sq., he would possibly simply be the CEO of all the chain.

His title is Neil Hershman, the newly appointed 27-year-old CEO of 16 Handles. And rolling up his sleeves to paintings the weekend shift on the emblem’s flagship occurs to be one in all his favourite portions of the task. He tells Fortune that each one 16 taste choices will also be overwhelming for patrons; the thrill section, he says, is explaining that you’ll get they all. 

“They’ll come again with this mound of fro-yo, and also you didn’t notice someone may stack cookie dough that neatly on most sensible of the cup sooner than,” he says. “And but, they’ve controlled to do it. It all the time makes me in point of fact satisfied as a result of then you definately’ll watch them sit down outdoor…they usually’ll take photos with their fro-yo in Instances Sq..”

It’s a second Hershman needs shoppers to experience now not simply in New York Town, the place 16 Handles is primarily based, however around the nation—and perhaps, sooner or later, the world over. Presently, he’s curious about increasing the franchise around the east coast with plans so as to add shops in Florida and Boston whilst additionally having a look at markets in California.

It’s indubitably formidable to take a look at to transport 16 Handles around the nation, however it’s in step with Hershman’s taste. In his teenagers, he was a grasp scuba diver and a educated pilot. And even if he’s most effective 27, he has a long time of entrepreneurship underneath his belt, courting again to when he bought items of gum to members of the family as a kid. He left his post-college hedge fund occupation after his Kickstarter marketing campaign for refrigerated coasters raised $150,000 inside 20 days. Hershman started making an investment in 16 Handles in 2019, turning into CEO of the corporate this previous August. 

Construction out a fro-yo empire received’t be a very simple process. The primary 16 Handles opened within the East Village in 2008, with 9 direct competition inside a three-block radius, Solomon Choi, founder after which CEO, instructed Refinery29. It was once the onset of the 2010s fro-yo increase—“a time customers had been curious about better-for-you, but tasty, ice cream possible choices,” Choi stated, including that the newness of self-serve and personalization had been additionally engaging elements.

The logo had 40 storefronts all through top fro-yo days, shedding to 30 by way of 2022, Refinery29 reported. It reflected the upward thrust and fall of fro-yo; the business’s income climbed at an annual charge of twenty-two.7% from 2009 to 2014, incomes $1.8 billion, according to an IBISWorld record. However the marketplace measurement of fro-yo shops were declining since 2014, hitting a low in 2020.

Hershman can have a couple of benefits to staging 16 Handles’ comeback, despite the fact that. For one, the fro-yo marketplace is projected to develop from $1.69 billion in 2021 to $2.14 billion in 2021, because of the upswing in health-conscious customers all through the pandemic and new levels of fro-yo flavors. And 16 Handles’ most sensible retailer already raked in $1,2 million in income closing yr. Hershman has additionally enlisted the assistance of minority investor and Youtube prankster Danny Duncan as Leader Inventive Officer to lend a hand get fro-yo within the mouths of a bigger target market: Gen Z. Bearing in mind their—and different generations’—want for nostalgia all through troubling financial occasions, Hershman simply could be a success in reviving the fro-yo craze. 

The upward push of the dessert king

Having lived in New York Town for a couple of years, Hershman says he was once a normal at 16 Handles’ East Village location. It was his first concept when he regarded to become involved within the meals business, which had all the time fascinated him. 

It was once obtrusive to him that, in spite of its dependable shoppers, no person was once in point of fact making an investment in 16 Handles. “I simply noticed such a lot alternative to wash it up and make it a greater buyer enjoy,” he says, including that he sought after to be a part of a rising emblem. “It was once simply the unsuitable management on the time.” 

He reached out to 16 Handles’ control 3 years in the past, and in combination, they devised a plan for Hershman to take over one of the corporate-owned shops. He says he invested $125,000 to change into a franchisor in his first location—Murray Hill. With a Small Trade Management mortgage to fund the remainder of the bills, he took the earnings from one retailer to his subsequent acquisition. 

One retailer become 3, after which Hershman constructed two shops. When the pandemic hit, sending NYC’s actual property marketplace to record-low costs, he took benefit of inexpensive rents to double down at the emblem and open the Instances Sq. flagship in early 2021. Throughout this time, he started taking on the New York Town dessert scene, opening two Captain Cookie shops and 3 Dippin’ Dots shops. 

With just about a dozen dessert stores altogether underneath his supervision, Hershman was once able to take over as 16 Handles CEO a yr later. 

He felt that now not doing so could be a neglected probability. “I may make these kind of adjustments, make this larger, and, within the procedure, flip the corporate right into a a lot more precious corporate,” he says. “However in a different way, I’m going to be more or less sitting in this basket of eggs, and observing them by no means hatch.”

A facelift, social technique, and partnerships galore

What Hershman first anticipated to be “some small easy factor” has become a bigger interest undertaking. 

He’s now not nervous a couple of dependable buyer base: “We’ve the name of the game sauce already,” he says, including that he’s extra curious about creating a technique for increasing the emblem’s shoppers and bodily location. That starts together with his partnership with Duncan, who’s overseeing the whole emblem imaginative and prescient to interact other demographics and check out advertising and marketing campaigns. With 6.8 million fans on his YouTube channel, Duncan can reel in a more youthful, male target market—a demographic that Hershman is having a look to talk to.

Hershman says they’re operating at the early stages of a brand new social technique to attraction to Gen Z, declining to remark additional on specifics however promising that it could lend a hand flip 16 Handles into “a in point of fact large emblem.”  

Even so, Hershman recognizes that the emblem’s final luck isn’t with regards to having a just right social media presence. “It’s additionally in point of fact about development the suitable places on the proper time and having comfy puts for those who really feel protected and open and alluring and be offering just right product,” he says, including that shops can be getting a facelift quickly. Construction extra shops will “slowly construct that hype teach again up.” He’s additionally emphasizing new partnerships with manufacturers like Oatly, an alternate dairy product, that attraction to the health-conscious.

However 16 Handles will also get a extra natural spice up because of the upward thrust of nostalgia all through the pandemic, which tugs on the heartstrings all through occasions of uncertainty or financial instability, particularly amongst more youthful generations. The fro-yo development of the 2010s following the Nice Recession harkened again to the fad from the Eighties. In a post-pandemic global with a looming recession, fro-yo may beckon again to more practical occasions. 

Hershman recommends that younger marketers at an identical crossroads stay the religion. “It’s cliche, however simply take the soar, take the chance. And not in point of fact surrender.” He issues to his adventure, explaining there have been many issues the place it appeared unimaginable to near or get the investment and lots of sleepless nights. 

“When you’re now not prepared to die in your hill, every now and then you’re now not gonna get the rest achieved,” he says.