How The Cupcake Business Blew Up And Became A Major Craze


Photo: lamantin via flickr

The idea of a cupcake shop filing for an IPO is baffling. But last week, Crumbs Bakery announced it would go public in a reverse merger worth $66 million.Those tiny little cakes your mum made when you turned five are now a hugely profitable business.

How did cupcakes go from a childhood treat to the trendiest dessert?

It all started with HBO's hit series Sex And The City (SATC)

The famous HBO television series began in 1998, and these four girls soon became the coolest women in New York City.

People mimicked their style, quoted them, and even ate what they ate.

In a 2000 episode, Miranda and Carrie enjoy Magnolia cupcakes

Just like any other episode, Carrie and Miranda chat about life, love, sex, and relationships.

But this time they gabbed over cupcakes in front of The Magnolia Bakery in New York City's West Village.

That's when the tourists began flocking

Emma Forrest wrote an article for The Telegraph about how that episode ruined her West Village neighbourhood.

She says tourists began making cupcake stops at Magnolia soon after the episode aired.

And then the SATC tour bus showed up

Magnolia soon became a stop on the Sex and the City bus tour of New York City.

Along with stops at the four characters' favourite bars, stores, and galleries, the bus made a stop at Magnolia for cupcakes. In May 2010, Magnolia Bakery was taken off the trip because they couldn't keep up with the demand.

It was replaced with another trendy cupcake bakery, Billy's Bakery.

Soon, cupcake shops popped up nationwide.

As Magnolia's popularity grew, cupcake bakeries began popping up all over the place.

Even reality TV shows focused on the cupcake shops.

Sprinkles Cupcakes was founded by Candace Nelson in 2003.

  • Cupcakes go for $3.50
  • There's a wide variety of cupcakes including gluten free and vegan
  • Owner, Nelson, is the judge of Food Network's Cupcake Wars

Georgetown Cupcake in Washington, D.C. has its own show on TLC

Sisters Katherine Kallinis and Sophie LaMontagne opened Georgetown Cupcake in 2008.

  • Cupcakes go for $2.75
  • There's a huge variety of flavours ranging from Carrot to Irish Cream
  • Their shop is featured on a TLC hit reality show, DC CUPCAKES

Cupcakes Nouveau in Miami has been featured on Cupcake Wars too

Cupcakes Nouveau was founded by two friends in 2007.

  • Cupcakes go for $2.75
  • There's cupcakes flavored like drinks, try Pina Colada or Chai Tea
  • Cupcakes Nouveau has been featured on Food Network's Cupcake Wars

But Crumbs Bakery takes the cake...

Mia and Jason Bauer opened Crumbs Bakery on New York City's Upper West Side in 2003.

  • Most of their cupcakes go for $4.50
  • There are now 34 Crumbs in six states
  • Crumbs did $31 million in revenue and $2.5 million in income in 2010

Now Crumbs Bakery is going public with a $66 million reverse merger with The 57th Street General Acquisition Corporation.

Do they have the Sex and the City crew to thank?

Some think cupcakes will soon be out and pies will be in.

Source: Yahoo Shine

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