Smudge started with an apple, a jar of peanut butter, and a question: Could there be a better chocolate option? For co-founders Tiffany Henry and Cari, that everyday snack became the beginning of a food business. A Kiva loan later helped them take the next step, from small-batch production to bulk ingredients, their own manufacturing space, and equipment to grow.
A snack worth making
Tiffany and Cari had worked together for years and often hosted conferences together. At one event, they were sharing the apple and peanut butter they had brought from home while eyeing the brownies and cookies nearby.
“Wouldn’t it be nice if we could have something chocolatey with our apple instead of peanut butter?” Tiffany recalled.
They searched for a chocolate spread that matched what they wanted in both taste and ingredients. When they couldn’t find it, they ordered ingredients and started experimenting in their kitchen.
Getting from that first idea to a finished product took patience. Tiffany estimates they spent about 18 months developing the recipe and tried more than 100 versions. Even as production grew, they kept adjusting: scaling a recipe turned out to be more complicated than multiplying every measurement.
When small batches weren’t enough
The need for funding became clear when Smudge was ready to buy ingredients in bulk. Instead of ordering small quantities through familiar suppliers, the founders needed hundreds of pounds at a time, with purchases costing thousands of dollars.
More ingredients also meant more space. Smudge had been using Spring Kitchen in Springdale, but the founders couldn’t store everything they needed there. Growing the business meant finding their own space and investing in equipment, too.
They considered a traditional bank loan, but Tiffany said the interest rate and borrowing amount weren’t the right fit for that stage. They had a specific next step in mind and didn’t want to borrow more than they needed.
“Kiva felt like a better fit for the size of our business and the specific stage we were in,” she said.
Capital with local guidance
Other entrepreneurs’ experiences encouraged Tiffany and Cari to explore Kiva. Locally, Claudia Scott and the Startup Junkie team helped them navigate the process, from an initial inquiry to the full application.
For Tiffany, the application was more straightforward than she had expected. She credited Claudia’s responsiveness and guidance with helping them move through each step.
The funding supported practical investments: Smudge’s first major bulk ingredient purchase, a move into its own manufacturing space, and a large piece of equipment to make production more efficient.
“The loan gave us the resources we needed to begin building a more sustainable operation,” Tiffany said.
Learning to ask for support
The hardest part wasn’t necessarily the paperwork. Tiffany said she underestimated the crowdfunding component and how it would feel to ask friends and people in her network to lend.
Reaching out directly was uncomfortable, but the response changed how she saw the process.
“What surprised me was how willing people were to help,” she said. “It was difficult for me to ask, but it was not difficult for them to support us.”
Support also came from people around the world who had never met the founders. Seeing lenders with different backgrounds choose to support Smudge gave the team encouragement as well as capital.
An unexpected introduction to new customers
After the campaign, Smudge began receiving orders from people across the country. When the founders asked how those customers had heard about the company, several said they had discovered Smudge through Kiva and lent to its campaign.
“I was surprised to discover that Kiva could also serve as a marketing channel for our business,” Tiffany said.
For Smudge, the campaign did more than help pay for the next stage of production. It introduced the product to people the founders might not otherwise have reached.
Start with a clear next step
Tiffany’s advice to another entrepreneur is encouraging, but practical: Kiva is still a loan, and it has to be repaid. Before applying, know how you will use the money and how your business will make the payments.
“You do not necessarily need to have everything figured out,” she said, “but you should have a clear purpose for the funding and a realistic plan for how the investment will help your business grow.”
For Smudge, that purpose was concrete: buy ingredients, create room to produce, and build an operation that could support the next stage of the business.
Learn more about Smudge and its chocolate spread at eatsmudge.com. If you have a next step in mind for your own business, explore Kiva NWA’s borrower resources and start an inquiry.
