JULY 1997
Vol.6, NO. 3

Entrepreneurs Dave Anderson (left) and Keith Nelson
turned a cake-design invention into birdseed confections.

Isanti, Minn. -- Dave Anderson and Keith Nelson aspired to make cakes for kids, creating designs like teddy bears for birthday celebrations. Instead, they're baking for the birds.

The partners, owners of Feeding Time, mold birdseed into trees, houses, mushrooms, squirrels and even the state of Minnesota. Their "cakes," made from seeds mixed with honey, dextrose and gelatin, are hot pressed into handsized cookie cutter forms and furnished with rafia for hanging. Songbirds can feast on the seedcakes for weeks.

Feeding Time began four years ago as A&N Cookie Cutter Cakes Corporation. Anderson and Nelson had designed unique bottomless cake forms: oversized cookie cutters held onto a flat baking pan with special devices. After baking, the forms lifted easily off cakes.

Witnessing the burgeoning interest in birdseed at his cousin's feed mill in Lake Elmo, Nelson suggested temporarily using the forms for birdseed cakes. They could sell the bird confections to raise money for equipment they badly needed.

"Everybody is into birds," Anderson says, and the prototypes they test-marketed locally were hot items. The entrepreneurs discovered they were entering a $2 billion industry. "In 1995, 90 million people in the United States bought some kind of bird feeder product."

Someone to listen

Nevertheless, they still had plenty to learn about bird confections. Nelson, experienced in product development and quality control, worked out the formula, and they made small batches with an electric double boiler in Nelson's garage. "The first ones disintegrated in the trees," Anderson says. "We were two Swedes trying to figure out what to do with this birdseed."

One economic development organization they approached suggested the venture would need millions of dollars to work. "Otherwise, they said, we could maybe sell at flea markets," Anderson says. "We left and were totally depressed." Nelson adds, "We had orders for the cakes, but we couldn't get them out fast enough."

At AURI, Mike Sparby was willing to listen and help. As manager of AURI's Morris office, Sparby helped the pair obtain AURI product assessment funds to investigate a better manufacturing system. With additional funds, they contracted with an equipment manufacturer for a custom-designed extruder. Another AURI client, barley-plastic lumber manufacturer Steve Raguse, helped with equipment design.

This month, Feeding Time's production goes into full swing. With new equipment, the business has the potential to produce 600 birdseed cakes an hour and can make a profit at 200 per hour. The cakes have been tested for two years, and the business partners are confident they have a top quality product. Anderson has been "hitting the road" to market the cakes while Nelson manages the plant. A year ago, they added accountant Steve Anderson to perfect their business plan, execute cost/profit projections and manage the finances.

Until now, Feeding Time has been marketing on a small scale, selling cases to nonprofits for fundraisers, to the DNR for state parks and shops, and to gift shops. Their state of Minnesota design is a big hit with Minnesota-grown specialty shops. The only other birdseed cakes on the market are hanging bells.

Cakes for a song

Because they appeal to songbirds, Feeding Time cakes have been praised by wildlife enthusiasts like DNR bird authority Carrol Henderson. Songbirds can grab on the forms with their feet, while nonnative birds like starlings cannot. "Other birds, like pheasants, will feed on anything that might fall on the ground," Nelson says.

The cakes, a little larger than a man's hand and about two inches thick, retail for $3.95. Though it seems like a steal, Anderson is apologetic about the price. "We're Scandinavian. If we think it should sell for $1, we should make it $3, because the Scandinavians are always afraid they're cheating someone -- then they go broke."

So far, the millet, cracked corn, sunflower seeds and wheat in the confections have been purchased through a distributor and don't all originate in Minnesota. Anderson and Nelson are "starting to deal with local farmers as much as possible" and ultimately intend to make an all Minnesota-grown product.

To make it easier for cardinals to snack, Feeding Time is considering making a hanging platform with a peg to hold the cakes. They're also designing all-corn cakes for squirrel feeders, reusable hangers and small Christmas tree ornaments. The ornaments could be hung outside for the holidays or left on the indoor tree once it is laid to rest in the backyard.

"Without AURI I don't know where we would be," Nelson says. "They opened up doors for us -- to suppliers, distributors, technical help -- and they helped finance our equipment. They didn't tell us what to do, but put us in the right direction."

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JULY 1997 * AURI AG INNOVATION NEWS