How Crumbl Devoured America

Forbes

Middle-school dropout Jason McGowan had no baking experience but cofounded a viral cookie company that now has more than 1,000 stores—and rumors of a $2 billion sale. Inside a financial sugar rush.  Read the full story on Forbes: https://www.forbes.com/sites/simonemelvin/2025/03/02/how-crumbl-cookies-devoured-america/  Subscribe to FORBES: https://www.youtube.com/user/Forbes?sub_confirmation=1  Fuel your success with Forbes. Gain unlimited access to premium journalism, including breaking news, groundbreaking in-depth reported stories, daily digests and more. Plus, members get a front-row seat at members-only events with leading thinkers and doers, access to premium video that can help you get ahead, an ad-light experience, early access to select products including NFT drops and more:  https://account.forbes.com/membership/?utm_source=youtube&utm_medium=display&utm_campaign=growth_non-sub_paid_subscribe_ytdescript  Stay Connected Forbes newsletters: https://newsletters.editorial.forbes.com Forbes on Facebook: http://fb.com/forbes Forbes Video on Twitter: http://www.twitter.com/forbes Forbes Video on Instagram: http://instagram.com/forbes More From Forbes:  http://forbes.com  Forbes covers the intersection of entrepreneurship, wealth, technology, business and lifestyle with a focus on people and success.

Transcript

00:00Today on Forbes, how Crumble devoured America.

00:06A pink promotional sign, filthy from standing outside the storefront in midtown Manhattan,

00:11is shoved against a wall inside a cramped Crumble bakery,

00:14where a crowd of grimacing customers squeeze against each other in a semblance of a line.

00:20For Crumble, a line outside the door has been the norm since Jason McGowan, who is 44 years old,

00:25and Sawyer Hemsley, who is 33, opened the first location in Logan, Utah in 2017.

00:32Since then, the company, known for its oversized treats,

00:35most notably the 4.25-inch ultra-sugary cookies that are nearly 1,000 calories each,

00:41expanded to 1,071 franchised locations across the United States and Canada.

00:47In 2023, Crumble earned $122 million of revenue from franchise royalties.

00:54The system-wide sales of all the franchises is just over $1 billion.

01:00McGowan, speaking to Forbes from Toronto, Canada,

01:03where he is meeting with the Jonas Brothers to discuss a brand partnership for an upcoming cookie lineup,

01:08says, quote,

01:10But one thing they got right from the very start was viral marketing.

01:24After all, giant cookies make for amazing Instagram fodder.

01:29Crumble has an impressive 9.8 million followers on TikTok,

01:32more than Starbucks, Dunkin' and Krispy Kreme combined.

01:36In total, more than 107 million TikTok videos mention Crumble,

01:41several of which have clocked up hundreds of thousands of views.

01:45In January, reports emerged saying Crumble was considering a sale

01:49that would value the company at $2 billion.

01:52But analysts believe that amount is just a sugar rush.

01:55John Gordon, a restaurant franchise specialist

01:58and founder of the San Diego-based Pacific Management Consulting Group, says, quote,

02:03None of us in the franchise business believes it'll sell for that much.

02:07Another prominent franchise, Jersey Mike's,

02:10just sold to Blackstone in November for 2.2 times its system-wide sales.

02:15Using that rule of thumb, Crumble would be worth $2 billion.

02:19However, analysts say that Crumble would not trade at that multiple

02:23given that the chain may have already peaked.

02:25Average same-store sales, a key metric,

02:28tumbled from $1.8 million in 2022 to $1.2 million in 2023,

02:34the last year for which data is available.

02:37McGowan, who owns more than 50% of Crumble,

02:40invested $68,000 of his savings to start the company,

02:44and since then the business has been self-funded.

02:47Hemsley owns most of the rest,

02:49and McGowan says one other person has just a few shares.

02:53McGowan, who dropped out of school after the eighth grade,

02:56came from Canada to the United States for the first time as a Mormon missionary.

03:00McGowan moved to Utah a few years after that in 2003,

03:03living on friends' floors for six months while he taught himself web development.

03:08Hemsley, McGowan's wife's cousin,

03:10had launched a clothing company shortly after starting college

03:13at Utah State University in 2015,

03:15and approached McGowan as an investor.

03:18The business failed soon after, while Hemsley was still in school.

03:22Neither McGowan nor Hemsley had any baking experience,

03:25but they were set on creating a cookie company.

03:28Hemsley says, quote,

03:42McGowan and Hemsley decided to create one product,

03:45a chocolate chip cookie.

03:47They tested recipes in Hemsley's parents' kitchen,

03:50learning from YouTube tutorials and commercial and local bakers in Utah.

03:54Hemsley picked out the flagship store,

03:56a vacant crepe shop in Logan that was set to be demolished in six months.

04:00They tested their early recipes on friends and family.

04:03Most were failures.

04:05Eventually, in September 2017,

04:07the pair developed their signature giant milk chocolate chip cookie.

04:11Before opening the first store,

04:13Hemsley promoted it on social media,

04:15particularly Crumble's social media-friendly pink boxes.

04:21For full coverage, check out Simone Melvin's piece on Forbes.com.

04:26This is Kieran Meadows from Forbes.

04:29Thanks for tuning in.

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