Nathan Beck  /  AP
Bagel inventor Janet Dob, 52, left, and her company's VP of Strategy and Development Ruth Turner pose behind a tray of boiled bagels in Verona, Va., on the west side of the Blue Ridge mountains.
updated 6/21/2005 5:22:32 PM ET 2005-06-21T21:22:32

Janet Dob found a better way to boil a bagel, quite by mistake.

Her accidental invention gave rise to a business, entangled her in red tape, left her morose in her pajamas, exposed her to the helping hands and hurdles of government and finally became her life's work.

So it goes for those who create a small business in America.

Perils exist at every turn. Many startups rapidly fail, and only about half survive as long as five years, says the National Federation of Independent Business.

Dob, 52, has yet to get rich, but she's plenty busy, and her business making Bake'mmm bagels is, finally, growing, now posting $750,000 in sales in a year. The business operates in the Blue Ridge Mountain town of Verona, population 3,638.

When she ran a bakery in Fort Collins, Colo., customers demanded lunch food along with her sweets and she began getting up at 2 a.m. to make bagels. She did it the usual way -- simmering them to make the outside chewy and the inside moist, then baking them in the oven to finish the cooking and brown them. She hated getting up so early.

Distracted during one simmering session in the late 1980s, she left a few bubbling in her crock pot too long and discovered when she extracted them that they did not collapse or look distressed, but rather inviting. These unintended prototypes got thrown out, but "I just started playing with it."

Her goal: classically chewy bagels that didn't keep her up most of the night. From that came the idea for boiled bagels that people could bake at home, out of their freezer, in a hurry.

Some frozen bagels in the store are not boiled before baking. Some are parboiled, then frozen, but take a long time from freezer to table.

Dob had discovered that by boiling the bagels until fully cooked, they could be baked in minutes, even when frozen. Much experimentation followed until she got it right.

"The initial mistake really was the founding mother of this invention," she said. "All by necessity. The necessity to sleep in."

Her retail business was born. Dob said she had seven people hand-making 1,000 bagels a day through the mid-1990s, freezing them and sending them to more than 60 stores. They cost 80 cents apiece to make. She was getting 30 cents a bagel. "We were bleeding."

A venture capitalist signed on in September 1995, and took control of the company. "I was desperate," she said. "I didn't ask all the right venture capitalist questions."

The financier soon went bankrupt, taking the company down with him.

"For 15 days I was in my pajamas most of the time," she recalled.

Idea still alive
The company was gone, but the idea was still alive. Pointing to her head, she said, "Everything I created was still mine."

She moved east, to Charlottesville, Va., and took a job with a micro-lending firm, helping to start new businesses in needy communities of the Blue Ridge Mountains.

She still wanted to make something of her bagel idea and tried to interest big concerns in licensing her process. That was tricky. She could tell them she had a better way to make a bagel but she couldn't say exactly what it was. She filed for a patent.

It took more than four years. The patent examiner is like a detective. He must make sure no one has cornered this method before. This one was fussy, Dob said.

Ah-hah! He discovered a similar method in an early edition of "Joy of Cooking." No dice, he said.

No, no, Dob insisted. The cookbook did not call for boiling the bagels until completely cooked. She set up demonstrations, proved her point. It worked.

She'd failed to license the process to others, failed to have a major contract baker produce them for her. But now she owned the idea and decided to make them herself. And this time, from all organic ingredients.

In October 2002, more than a dozen years after her "eureka" moment with a crock pot and with the aid of a Small Business Administration loan, Dob and her partners had their grand opening in an "incubator" building in Verona.

Her company, Agnes' Very Very, employs eight people in the mixing and making of 2,000 bagels a day, from a modest production line where dough is mixed, formed into shape and cooked. The bagels come steaming out of the vat for packaging, freezing and shipment.

Regional stores in the Whole Foods organic and natural foods chain signed up out of the gate, and smaller outfits came on board. Lacking a distributor, Dob and her minimalist team delivered the goods themselves in an ever-widening arc.

She says her company is close to breaking even and she's getting to sleep in until 6:30 a.m.

So will she jealously guard her homegrown business if the big brands -- Kraft, Paul Newman -- come calling, wanting to buy her out?

Heck no. She'll sell out in a minute.

"Oh, it will be so joyful," she said. "I want them to have it. This has been my 401(k) all along."

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