This CEO Was Running 3 Yogurt Shops at 23, Then Purchased the Company at 27. Now He's Sharing His Secrets. Discover how one young entrepreneur left the world of finance to revitalize a dessert franchise.
- Neil Hershman exhibits a hands-on, down-to-earth approach to leadership.
- During the pandemic, Hershman saw potential when many saw despair and challenges.
- Hershman's efforts have borne fruit, with 16 Handles now on a significant growth trajectory.
Whether he's zipping around Manhattan from store to store on his scooter or cleaning the bathroom at one of his locations so a new employee can get more important training, Neil Hershman isn't the typical CEO — and the 28-year-old head of the 16 Handles frozen dessert chain is okay with that. "The basis of my leadership is I'll do any job any time," he says. "And honestly, I don't think any team members see me as the CEO. We're in it together."
Hershman graduated from George Washington University in D.C. in 2017 with degrees in finance and astrophysics. After graduation, he went into finance as an M&A analyst, but something didn't feel right. "I loved the work, especially the M&A and liquid valuation aspects, but I knew it wasn't the lifestyle for me," Hershman says. "I saw people my dad's age working long hours. They were making great money but didn't seem happy." Hershman had been in the industry for about a year and a half when he began thinking about his next step.
Venturing into franchising
With his future on his mind, Hershman did what he often did when he needed to think — he went to the 16 Handles frozen yogurt shop next to his apartment. But he noticed that the shop had all sorts of minor issues, such as the roof leaking, and an idea dawned on him: What if he purchased a franchise? "I loved the product as a customer," he says, "so it seemed like the perfect fit. And I was always entrepreneurial."
He set up meetings with the 16 Handles founders, who he discovered had stepped back from the business. "And then it started to make sense," Hershman says, "That's why the store that I loved in the East Village had all these issues."
In 2019, at 23, Hershman used an SBA loan to acquire one of the corporate 16 Handles stores in Murray Hill. "I worked at that store for three months straight every morning to close," he says. Later in the year, he acquired the other two corporate stores in Manhattan. He ran those three locations for more than a year and then set his sights even higher — he wanted to buy the entire company, which at the time had 22 locations.
Betting on New York City
As Hershman was moving forward with his plan to purchase 16 Handles, Covid hit. New York City was a ghost town, and some were sounding its death knell. But, like so many entrepreneurs, Hershman saw an opportunity where others saw negativity and closed doors. He didn't believe New York City was dead and was willing to bet big on it. "We closed, of course, during Covid," he says. "But within a few weeks, my managers wanted to get back to work, and we opened for delivery only for months. And wow, it worked well."
"I just bet that New York City was going to come back at some point."
But he knew that wouldn't last if people and businesses left the city in droves. So he rolled the dice. "All the retail had left," Hershman says. "I ended up taking a lease in Times Square way below market value, and I renegotiated with all my landlords for very long-term leases. I just bet that New York City was going to come back at some point. It seems like a no-brainer now, but there were some weird months." Thanks in part to these leases, he opened several more shops in Manhattan, for a total of seven in the borough.
16 Handles purchase
Hershman already had a relationship with the 16 Handles ownership and entered the gauntlet of purchasing a business, which he says was not for the faint of heart. The process seemed to take forever and was filled with unexpected obstacles. "[When I was] raising capital for the 16 Handles acquisition, I wanted to quit so many times. It just seemed so impossible," he says. "The hoops I had to jump through — 'Wait, here's 20 more conditions.' It's just sometimes so defeating. But then you just have to wake up the next day and say, 'I'm going to figure this out.'"
He finally closed the deal for ownership of 16 Handles earlier this year, and the need for new energy to revive the floundering franchise was obvious. Hershman went to work sprucing up the chain's stores and devoting energy to training employees, and people noticed. "I think Neil has done a tremendous job infusing a ton of energy back into 16 Handles as a brand," says Erik Mallon, the 16 Handles VP of franchise development.
15 locations under construction
16 Handles has 15 new stores across the country under construction, including locations in Texas, Florida, New Jersey, Massachusetts and the Carolinas. "Our pipeline is the biggest it has ever been," Hershman says, "I can't even imagine what the next three years are going to look like."
Hershman says that the company is growing at the right time in the right way, an essential factor for franchises.
Reflecting on all the hard work, difficulties and struggles he initially endured, the young CEO struck an optimistic tone. "All of a sudden, things start working out," he says. "It feels like it happens all at once. One thing works out, and it all feels like it's coming together. Then it was all worth it."