CNBC: How this couple grew their basement side hustle into a business bringing in $4.5m a year

After months of bringing in less than $100 a day, Audrey Finocchiaro and her then-boyfriend Sam Lancaster were close to walking away from their coffee cart.

They built the wooden cart with bicycle tires and a kickstand in her parents’ basement in 2016, maxing out her credit card’s $1,500 limit to afford materials, and called it The Nitro Cart. That summer, they took it to any event that would take them, from sheep shearing events to farmers markets across Rhode Island, serving small batches of nitrogen-infused cold brew.

“Sam and I had been popping up every day together, and when you’re not making any money and you’re also dating, that can get sort of frustrating,” says Finocchiaro, 30. “At the end of the summer, we were sort of like, we don’t want to do this anymore.”

A gaggle of college students changed their mind that fall when Lancaster took the cart to Brown University. The cart sold out for the first time, bringing in $400 in sales in just 30 minutes, Finocchiaro says.

They started going back every day, building a reputation on campus. To survive the winter, they partnered with local restaurants to install their nitro cold brew on tap.

Today, the business — now called The Nitro Bar — brings in millions in sales: $4.5 million over the past year, according to documents reviewed by CNBC Make It. It has 50 employees at three brick-and-mortar coffee shops and a smaller coffee trailer, and its cold brew is available on tap at more than 50 other locations across Rhode Island and Massachusetts.

The co-founders are also married now, and their business has balanced profitability with expansion since its first money-making year in 2019, Finocchiaro says.

Here’s how they built The Nitro Bar, from 80-hour workweeks to some TikTok virality and a lot of luck.

An unexpected $100,000 in funding

Finocchiaro grew up frugal, and believed the cart would only last for one summer, she says. She and Lancaster didn’t fully realize they’d created a business model with scalable potential until the spring of 2017, when they were approached by a pair of venture capital investors who tried their cold brew at a farmers market and liked it.

One of the investors was a familiar face: Finocchiaro had previously worked for her. The investors created a spreadsheet to calculate what The Nitro Cart could grow into, based on projected number of carts and wholesale tap accounts.

“It was very, very scalable, and did pretty big numbers in not a lot of time,” says one of the investors, an entrepreneur who requested anonymity to protect her privacy.

One Sunday morning, the investors invited Finocchiaro and Lancaster to their home, showed them the numbers and offered them a $100,000 loan at a 10% interest rate to help them grow their business.

The investors retained a right to convert the loan into into a 10% equity investment in The Nitro Bar, says Finocchiaro.

“When we got the investment, it was so emotional because we had never seen anything like that in a bank account,” she says. “Now, it’s not just this little coffee cart. Someone gave us all of this money and we have to figure out how to grow it.”

‘Eventually it’ll catch up with you’

The $100,000 loan provided Finocchiaro and Lancaster with a financial cushion. It didn’t mean the co-founders could sit back and relax. They both worked “insane hours, usually seven days a week” to turn their cart into The Nitro Bar, says Finocchiaro.

Watching their cash flow rise and fall was particularly stressful in the early days, she adds.

“I would ask Sam, like, did someone steal money from our account?” says Finocchiaro. “There’s just so many costs that come with running your own thing.”

Now, Finocchiaro and Lancaster’s days begin at 5:30 a.m., when they run with their dogs before heading into their shops to check on employees. Then they create lists of tasks to complete in the coming week, like building out their production space or testing out new menu items.

When the clock hits 6 p.m., they stop talking about work, Finocchiaro says.

“You can work 80-hour workweeks every week, but eventually it’ll catch up to you,” she says. “And the recovery of finding balance after that catches up to you is so much more difficult than just finding a balance for you in the here and now.”

The power of social media

If any of this sounds familiar, it’s probably from TikTok: The Nitro Bar has more than 220,000 followers on the social media platform.

The account features aesthetic coffee clips and funny videos, where Finocchiaro asks baristas about the weirdest drink order they’ve gotten recently (an americano made with orange juice) and what they’d make Beyoncé if she walked in (a lavender lemonade with espresso).

Finocchiaro credits the brand’s TikTok popularity to something she calls “the Ben & Jerry’s effect.” The idea is to treat The Nitro Bar as “almost its own person,” and for that person to come off as someone who customers want to befriend, she says.

“When you buy Ben & Jerry’s, you feel like you’re supporting these two guys from Vermont, and I think that’s attributed to so much of their success,” says Finocchiaro. Sales are up 60% since The Nitro Bar started gaining traction on TikTok, she adds.

Finocchiaro also shares her journey as a small-business owner on her personal TikTok account, where she has more than 67,000 followers.

“I probably get 20 of those DMs every week from people wanting to do a similar thing, or asking questions about how they can do it,” she says. “Which is always very humbling and shocking that they’re asking me for advice.”