Quebracho Empanadas, an award-winning startup that makes and sells frozen empanadas, ceased operations this week.
The St. Paul-based company that grew from a farmers market booth to a catering company, then switched to a frozen food manufacturer during the pandemic, was selling products in more than 350 stores across seven states.
But founder and CEO Belén Rodríguez said Quebracho struggled to raise capital. The company, which was self-funded initially, spent seven months talking to nearly 200 investors, but raised only $15,000 — despite screening investors to make sure they were a good fit for the business.
"For emerging brands that happen to be in the inflection point, and that was the case for Quebracho, there was an issue with access to capital," Belén said. "We were hit pretty hard during the last quarter of 2022 with inflation. There's been an increase in costs of goods not only for us but for retailers."
The fundraising challenges meant the company was unable to invest more in brand awareness.
"When entering those critical brand awareness years, that's something that can make or break a product," Belén said. "This is across the board for the entire industry. We know that we are not alone in this difficult decision we've had to make."
Born and raised in Argentina, Belén came to Minnesota 12 years ago and launched the business to recreate some of the foods she loved from home.
In 2023, Quebracho Empanadas won the food division for the MN Cup.
"There were many accomplishments, emotionally for me, carving that meaningful space in the highly competitive frozen foods space," Belén said.
As challenging as the process of closing has been, Belén said she had grown to become a leader, understanding when it was the right time to come to an end.
"It was a graduating moment for me to know when it was time to close," Belén said. "That's a hard thing for founders."
