St. Louis Park's Muddy Paws Cheesecake closes, hopes donations can help pay debt

Muddy Paws Cheesecake in St. Louis Park closed its doors Wednesday, but its owner hopes donations will make this just a temporary shuttering.

The small business has a debt load of $480,000, which has put the operation in dire straits despite a slew of honors for its many-flavored desserts, including a visit to the White House and an appearance on the Food Network.

"We're trying to get a fund to get half of that covered," said Tami Cabrera, the owner of Muddy Paws who has run the business for 30 years, of the $240,000 goal. "I've been struggling and doing my best to make it all work."

Despite the looming debt, Cabrera said she has no plans to file for bankruptcy, even though businesses like hers that are not registered nonprofits don't typically solicit handouts.

"I want to pay people what I owe them," she said, adding shutting down the business would still leave her with the debt but rob her of the joy of making cheesecake.

Cabrera started Muddy Paws in 1993 at age 23, renting space in an incubator kitchen from the Amherst H. Wilder Foundation in St. Paul. She built the business up to three retail locations in St. Paul, Maple Grove and Uptown Minneapolis, but those locations closed in 2006 for various reasons, including too many burglaries in St. Paul and high rent in Uptown.

Cabrera said a series of events in recent years buried the bakery in debt.

A destructive burglary in 2018 at a previous location in St. Louis Park prompted the move to the current spot the following year. Cabrera said issues with inspectors and contractors complicated the buildout at the space near Louisiana Avenue S. and Hwy. 7 and added $180,000 in unexpected costs, the bulk of which still needs repaying.

"It took us a lot of extra money and time. We had to keep doing things over," Cabrera said of the construction.

The pandemic, which squeezed businesses everywhere, added another $85,000 in debt. And in 2021, Cabrera opened and sponsored West End Artisan, a shop for local artists and makers at the Shops at the West End. Another operator is taking the space now, but there's still $138,000 in debt from it. Steep increases for ingredients and supplies have also added more stress.

"I've rarely been someone to ask for help," Cabrera said. "We're not just putting out a product. We're part of the community."

Muddy Paws has long donated to numerous charities, Cabrera said, and spent more than $50,000 on free deliveries during the pandemic. Since word of the closing and fundraiser spread, she said customers have been streaming in to buy cheesecake and share memories.

Cabrera has outlined some plans on her website to more effectively run the business and stave off a similar crisis in the future. Ideas include installing a new online ordering system, trimming the number of flavors down from a whopping 222, reducing retail hours to save labor costs, acquiring a larger refrigerator and potentially selling at the State Fair.

Cabrera also wants to find a vehicle to revive the Camp Cheesecake food truck that operated from 2015-21. It would also become a delivery service to save on courier costs.

Muddy Paws had an annual revenue of $190,000 for 2022 with one full-time employee and two part-timers. Cabrera, who does social media consulting, has never paid herself a salary because she founded the bakery "to give something back," she said. If the campaign to raise money and reduce debt succeeds, Cabrera hopes to pay herself a minimal salary.

"We've earned trust and respect from people," she said. "We're an important part of the community."

The fundraising campaign runs through Jan. 19. During the final two days, Muddy Paws has planned a "telethon" streaming online with special guests and live music. Muddy Paws is particularly seeking large donations from "small businesses and companies," per Cabrera. Reward tiers including free T-shirts and having your name posted in the store's lobby.

Minnesota businesses can also raise money via equity crowdfunding under the MNvest program but must issue securities in return for the investment. Cedric Long, president of St. Paul-based Silicon Prairie Capital Partners, works with companies that do just that and said Muddy Paws could benefit from it, including potentially garnering more interest than a donation campaign.

Many companies, particularly startups, have raised money through websites like Kickstarter and GoFundMe. Cabrera said she studied some crowdfunding options but did not think they were a good fit given the fees involved.

The city of St. Louis Park reached out to Cabrera on Tuesday with another option to help her business:

"We provided her information on a couple of our financial assistance programs," said Greg Hunt, economic development manager for the city. He added one program offered forgivable loans, while another offered loans at a 2% interest rate.

Cabrera, a single mother of four, was born in Chicago and grew up in southern Wisconsin. Her parents had two restaurants, meaning she "grew up with really great cheesecake," she said.

Lindey's Prime Steak House in Arden Hills has Muddy Paws Cheesecake on its menu, a partnership for at least 15 years, said owner Mark Lindemer.

"It draws people back. It is a recognized brand," Lindemer said. "I hope things work out for Tami."