When asked to describe Tate’s Bake Shop in three words, Kathleen King immediately says “Taste of home.”
If you’ve bitten into a Tate’s chocolate chip cookie, you probably get it. Consumer Reports and Rachael Ray have both called it America’s best, and you’ll find it in grocery stores across the country and all over the Hamptons’ East End.
In June 2018, Mondelēz International, the company behind Oreo and Chips Ahoy, bought Tate’s for $500 million. King told Business Insider that the sale meant handing her legacy over completely.
King is now retired, but this story starts long before the deal, back when she was a kid on her family’s North Sea Farms in Southampton, New York.
How Kathleen King Started Baking Cookies at 11
At 11, King started baking cookies to sell at her father’s farm stand, six for 59 cents. People loved them, and there wasn’t much competition. By high school she was spending her summers baking ten hours a day, seven days a week.
“When I was [growing up on a farm], I felt like a child slave, but looking back it was really heavenly,” King said. Her parents had always told her she could be anything if she was willing to work for it, and the farm gave her the habits to match.
“It’s a tremendous amount of hard work, you start working at a really early age,” she said. “In the big picture, it’s wonderful — you develop work ethic, learn to apply common sense, and see how nature is entwined.”
Farm life also taught her to take a hit. “It’s not easy. You learn when you fall down, you get up,” she said. “There’s nothing cushy or protective. Which is what made me survive my journey.”
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Locked Out of Her Own Bakery
In 1980, at 21, King put $5,000 toward renting her first bakery and began selling Kathleen’s Cookies wholesale to farm stands. Three years later, she used a $50,000 down payment to purchase her first bakery, opening Kathleen’s Bake Shop in the same building where Tate’s operates today.
By 1999, she was ready to grow. She brought in her bookkeeper and his brother as partners, a man she already knew and trusted. The deal was that they’d push the business national while she stayed on as CEO and handled the business side.
“As soon as I signed the contract, the partner I knew well turned into a different person,” King said. “They were money hungry, couldn’t reproduce any of my products, and when I put my foot down, they told me my pride was getting in the way of my job.”
King tried to keep vendors happy by paying them with cash from customers at the bake shop. The partners accused her of stealing, fired her and locked her out of the shop she had built.
She fought back in court, and the dispute eventually ended with a compromise. They got to keep the Kathleen’s Bake Shop name, while she kept her property and was left responsible for about $200,000 in debt.
With her savings gone, she had to take out a new mortgage on the shop she had spent years paying off. She was right back where she started.
How Tate’s Bake Shop Bounced Back
Even without the name, King had two things going for her, the quality of her baking and a community that backed her. Tate’s took off. She paid down the debt, and by 2003 the business was back to roughly $3 million a year in revenue.
“I had the gift of dying and coming back, learning what didn’t work in that lifetime and what will work in this lifetime,” she said.
King was 40 when she launched Tate’s, and she already had an age in mind for retirement. She promised herself she would step away at 55 after feeling like she had spent her entire youth working.
“When I went into business, my goal was to buy an apartment and car and move out of the house. My goal was to be the No. 1 cookie,” she said. “Then my goal was to sell, so I could retire.”
Who Owns Tate’s Cookies Now?
King got closer to her retirement goal in 2014, when The Riverside Company purchased a majority stake in Tate’s for $100 million. Under Riverside, the brand continued to grow and added new products. As King put it, “I didn’t have to work really hard, I didn’t have to do the day-to-day, and I was on the board.”
Then in June 2018, Riverside sold Tate’s to Mondelēz for $500 million. Since Mondelēz took over, Tate’s production has gone from 1.5 million cookies per week to 1 million per day.
After decades of early mornings and hard-won lessons, King has stepped away for good, or at least for the time being.
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