Malena Lopez-Maggi, founder and owner of Berkeley’s Xocolate Bar, first encountered the lobster parable while browsing social media. Rather than easily molting its shell and growing a new one over the seasons, the crustacean swells and swells inside the same shell until the discomfort becomes too great – the shell breaks off. Only then can the lobster truly grow. “It’s the Xocolate Bar,” says Lopez-Maggi. “We are the lobster. Compared to 10 years ago, we are doing seven or eight times the volume. In the same building. We are at a bursting point.
Despite being in business for 15 years, Lopez-Maggi says the Xocolate Bar is still barely making it, going from a high-volume vacation to a high-volume vacation with meager profits. Every year she wonders if she’ll make it through Valentine’s Day, she says, and then she wonders again if the February boost will be enough to get her through Christmas. Finding a way to chart a sustainable course as a woman in the chocolate industry is harder than ever, says Lopez-Maggi, although there are new ways to thread the needle these days.
Long before beginning her foray into the chocolate industry, Lopez-Maggi worked in a metal shop while her partner Clive Brown worked with molten glass and ceramics. The couple were always looking for new materials to mold, and during an exhibition at the KPFA Craft Fair in 2005, they saw handmade chocolate for the first time. The possibilities of painting with edible minerals, sculpting melted chocolate, and alchemizing flavors both hooked them from the start.
“We were seduced by the idea of this multi-sensory sculpting material,” says Lopez-Maggi. “We didn’t know anything about the technical aspects of handling chocolates. We went with our instincts, rather than how candies or pralines were historically made. Most of the recipes they came up with ended up being vegan. Neither Lopez-Maggi nor Brown are strictly plant eaters, but they found that adding milk to the pungent flavor profile they craved created a curdled taste in their chocolates. So they dropped the dairy, a decision decidedly ahead of its time.
In 2006, when it wasn’t yet cool to call chocolate “plant-based,” Lopez-Maggi rented his first commercial kitchen for the Presidio Yacht Club’s Xocolate bar to an owner, who ran the club. . As it was a communal kitchen, the young company had difficulty finding space; strong smells or burners that are too close to chocolate could impact the final product. “We were working these ridiculously long eight a.m. to two a.m. days to get the perfect batch,” says Lopez-Maggi.
As things got out of hand, their friend Lisa Bullwinkel, then head of the Solano Avenue Association, found them a bigger spot to rent. The investment made sense; the space allowed them to put production in the back, with a small store in the front. In 2008 they opened in Berkeley; the open was found to fall the same week the stock market crashed. The small store hung on to stay open, relying on word-of-mouth rather than advertising. “We hung on and grew slowly over the years,” Lopez-Maggi says.
With a rooted location, Lopez-Maggi says she was ready to expand the business, but she began to feel financially constrained, as if the doors just weren’t opening for her, she says. She had gone bankrupt years before, had student debt and says she was denied business loans, lines of credit and a mortgage. “We didn’t have ‘daddy’s farm’ to give a loan,” Lopez-Maggi says. “It’s not directly because I’m a woman of color, but because I’m in a common economic situation among women of color.”
Margins on chocolate are notoriously low, as they are for all food companies, so securing funding to develop the Xocolate bar has continued to be a struggle over the years, Lopez-Maggi says. But new financing options – outside of traditional bank loans – have recently started to provide opportunities for small businesses like the Xocolate Bar. Lopez-Maggi just took out a loan from microfinance company Kiva, as well as a loan from a bank, and started a GoFundMe to raise money for improved chocolate equipment. “We can no longer work two 10-pound tempering machines,” says Lopez-Maggi. “Our fridge is 25 years old, which is ridiculous.”
She’s not the only business owner looking to overcome funding hurdles through non-traditional funding sources. In recent months, Yuka Ioroi’s Cassava Restaurant in San Francisco’s Richmond District and Raul Medinas’ Venganza Foods in Oakland have used WeFunder, an online crowdfunding service, to raise the funds needed to meet their financial goals. In Oakland, Reesa Kashuk’s Poppy Bagels found SMBX an appealing alternative to traditional fundraising, and Something Better Foods’ GW “Chef” Chew turned to finance company Runway Project for help.
But limited access to capital is not the only thing Lopez-Maggi says it has prevented her from growing her business any faster. “I know a lot of women who can’t scale like our male counterparts,” Lopez-Maggi says. “It’s the intersection of intergenerational wealth and privilege in the equation.”
Wendy Lieu of Socola Chocolatier, which she and her sister have run since 2001, may feel like the cards are stacked against her as a female entrepreneur. She and her sister got into a farmers market in Santa Rosa when Lieu was 19 and her sister, Susan, was 16. They sold their products in front of their parents’ nail salon. The company name is Vietnamese, so curious customers asked if the sisters sold Vietnamese chocolate; Lieu would tell them no, just that she and her sister were Americans of Vietnamese descent. “All the others [in the industry] was male and mostly white,” Wendy explains. “Plus, we were two teenage sisters starting their own business. We had a lot to prove because we were young, we weren’t men and Europeans, and we weren’t classically trained.
Mindy Fong, owner and founder of Jade Chocolates, cites the explosive popularity of Scharffen Berger Chocolate Maker in Berkeley circa 2007 for her entry into the chocolate game. The success of this company, which was later acquired by Nestlé, predicted where chocolate was going in Fong’s mind. But unlike Scharffen Berger, which was founded by a winemaker, Fong’s company — which often highlights flavors common to Filipinos and Chinese Americans like mango, rice and various teas — has already been ridiculed by a customer for its “esoteric flavors”, she recalls. . “It was a little shocking,” Fong says. “I look at him thinking, how can you think that way?”
Still, Lieu doesn’t want to come across as bitter. She eventually realized it was a benefit to feature less common flavors, then began to wonder why Vietnamese coffee couldn’t be a flavor for chocolate, guava, or durian. There were no Asian, female, or Vietnamese chocolatiers that she knew of in Sonoma, the county where she started her business. “The landscape has changed over the past 20 years and it’s been exciting to see greater representation of women and people of color in the chocolate industry,” Lieu said. “I’m proud to have been part of the diversity movement.”
In 2020, the Xocolate Bar store closed its doors to customers due to the pandemic and shifted to online sales, something the company had never offered before; shipping always seemed like too much work. Now, the Solano Avenue store looks like a mini-warehouse with packages stacked from floor to ceiling. The team stands in what was once the retail space, among the mountains of cardboard, madly wrapping the packages in tape. It was the only option to stay afloat, Lopez-Maggi says, and it helped give the company a new direction. “We were busier than ever,” says Lopez-Maggi. Do, a Bay Area-based tech company like Etsy for wholesalers, was a godsend. “The volume has quadrupled since before the pandemic,” says Lopez-Maggi. “It’s this Tetris puzzle about how to maximize space. It’s constant.
Things can get better, but scaling up up offers the same challenges as ever; finding an affordable place to expand will be a challenge, says Lopez-Maggi. This brings her back to the parable of the lobster: her business continues to grow, but the constraints of economic and cultural pressures seem to continually tighten. However, any day now, Lopez-Maggi is betting her weight will crack. . “We are growing slowly, slowly,” she says.