.png)
Daly's Donuts' Leap of Faith to Brick and Mortar is Paying Off
- Bob Benenson
- 7 minutes ago
- 9 min read
Conor and Alejandra Daly Started Business as Farmers Market Side Hustle in 2023
For Conor and Alejandra Daly, the biggest news at their Daly’s Donuts startup is that things are feeling normal.
That might not be the kind of announcement that makes headlines. But for this young married couple — who turned a side project into a growing Chicago food business — it is a milestone worth celebrating.
Six months after opening their first brick-and-mortar Daly's Donuts shop in Chicago’s Lincoln Park neighborhood, Alejandra and Conor have settled into a rhythm.
The company started just three years ago, right across the street with a weekly stand at The Lincoln Park Farmers Market, and continues to balance their new store’s steady traffic to serve customers at Green City Market and the South Loop Farmers Market.
At the same time, they are expanding their catering business — and preparing for what the Dalys expect to be their busiest season, because people love their fall doughnuts. Apple cider doughnuts, apple cider dunkers, apple cider glazed and a caramel apple doughnut are on the way; a pumpkin doughnut will arrive later in the season, timed to the Thanksgiving holiday.
“We finally hit our groove with everything operationally and staff-wise,” Alejandra said. That is no small accomplishment considering how far Daly’s Donuts has come since its debut in 2023.
DOUGHNUT NATURALS
The business began with baked doughnut recipes Alejandra had spent years developing — creating a significant point of differentiation in a product category dominated by fried doughnuts.
The idea became a business almost accidentally after she made the doughnuts for Conor’s birthday. Friends and family loved them. Rather than spending months debating whether to launch a business, the couple simply decided to try it. “We literally the next day were just, ‘Let’s do it,’ and went for it,” Alejandra said.
That impulsive decision may have been an advantage. If they had taken time to strategize, Conor said, “I don’t think we ever probably would have launched it. We would have overthought things.”
At the time, neither was looking to abandon a career. Conor had been with Blueprint Health Care Real Estate Advisors for about 12 years, while Alejandra had spent roughly seven years at GForce Life Sciences. Both enjoyed their jobs but were looking for a creative outlet and a new challenge.
So they started small. They sold doughnuts on Friday nights at Glascott’s bar, in the same Lincoln Park building where they lived and baked. If they received seven orders, that felt like a big day.
Then a friend of Alejandra’s suggested a farmers market. The couple tried it and discovered something they had not expected: people would actually show up to buy their doughnuts.
Their early stint at The Lincoln Park Farmers Market provided something particularly valuable to the first-time entrepreneurs — a way to test the concept and build a customer base without immediately committing to a costly storefront.
The Dalys researched the market, added more farmers markets and developed a conservative financial model based on what they thought they could realistically sell.
The numbers began to work. Alejandra left her corporate job to work on Daly’s Donuts full time in May 2024. Conor followed in October.
The annual Apple Fest street festival in the Lincoln Square neighborhood was another important turning point. Then came Green City Market in 2025, which changed the scale and efficiency of the operation.
“Getting into Green City totally changed the game,” Conor said. The market gave Daly’s Donuts a reliable, high-volume retail outlet while allowing the couple to work smarter rather than simply adding more markets and more hours.
During that 2025 season, the couple realized they needed more space. The apartment kitchen was no longer adequate for the volume of doughnuts they were producing.
But the farmers markets also gave them something else: confidence. They knew they would still have those outlets even if a new retail store struggled.
“We underwrote any shop situation to be zero revenue on retail,” Conor said. If the business could still break even or come close based on the markets, “then it made sense.”
That disciplined approach helped them make the leap without taking on the kind of debt that could have put the entire business at risk.
SUCCESSFULLY NAVIGATING START-UP PROBLEMS
The storefront they chose was particularly fitting. The couple renovated a former dry cleaner directly across from Lincoln Park High School, the Saturday site of The Lincoln Park Farmers Market.
Getting the shop open, however, was considerably harder than they anticipated. As first-time brick-and-mortar operators, they encountered the usual complications involving construction, licensing, inspections and equipment — and then some. Their opening was repeatedly delayed, leaving them with only about three days to prepare after finally receiving the necessary approvals.
They tested the oven twice. Then they opened on March 7… and an hour-long line stretched around the block.
“We were definitely not expecting it,” Conor said. The opening-day crew was essentially Alejandra, Conor and Conor’s brother Colin, with help from other family members. They sold out around noon.
The accomplishment was gratifying. It was also exhausting. Alejandra remembers looking around the shop after they sold out and realizing that they still had to clean it — and then do it all again the next day.
The transition from farmers markets to a five-day-a-week storefront was one of the biggest adjustments the couple had faced. Their previous schedule allowed them to work intensely on market days and then have several days off. The store demanded a different kind of endurance.
Six months later, the operation looks much different.
The Dalys have a small but growing staff, including a night baker who joined the company in May and has become an important part of the production operation. Another employee handles much of the batter preparation and glazing that had previously fallen almost entirely to Alejandra.
For someone who describes herself as a perfectionist, handing over the recipes and production process has not always been easy. The first year, Alejandra and Conor did virtually everything themselves — baking, selling at markets, cleaning and handling every step of the business. The second year brought farmers market staff. Then came Colin and additional help with production.
Each step made the next one easier. “I feel like over the years we’ve gradually given up control,” Alejandra said. “That’s helped.”
The confidence has grown along with the team. Their night baker, Alejandra said, sometimes makes doughnuts that are better than ones she has made herself. “That’s the goal,” she said. “It just makes you more and more confident that other people can do it. It doesn’t have to all be on us.”
That is important because the couple increasingly wants to move from working in the business to working on it.
For now, they are deliberately building their team slowly rather than trying to hire their way out of the operation. They are looking for another night baker, but there is no immediate rush.
KEEPING THE OPERATION LEAN
The same measured approach applies to growth. Daly’s Donuts is expanding its catering business, including providing doughnuts for tenant-appreciation events in Chicago high-rises. The company has also begun building a stronger corporate customer base now that the Dalys have the store’s daily operations under control.
And there are other potential growth levers: increasing coffee sales, reaching more students from Lincoln Park High School and adding festival opportunities.
But the Dalys are not interested in growing simply for growth’s sake. That philosophy is reflected in the doughnut menu itself.
When Daly’s Donuts entered the market, the company had an obvious point of differentiation: its doughnuts are baked rather than fried. That distinction allowed the company to compete without trying to imitate established doughnut shops.
“We have yet to see another baked donut,” Conor said. “That gave us an opportunity to counterposition the rest of the market.”
The company also intentionally kept its menu relatively simple. Rather than chasing the increasingly elaborate, social-media-driven doughnuts that can involve everything from cereal toppings to bacon and gold flakes, Daly’s focuses on a smaller collection of flavors.
That simplicity is not just aesthetic. It is an operational strategy.
A more complicated menu requires more ingredients, more preparation, more opportunities for waste and more opportunities for mistakes. In an industry where margins are notoriously thin, the Dalys wanted to keep the operation as streamlined as possible.
Alejandra’s creativity is therefore working within a set of practical constraints. The result is a menu that changes with and within the seasons and, increasingly, with the farmers who supply the ingredients.
Green City Market has played an important role in that process. Because the market emphasizes products made with ingredients sourced from its farmers, seasonality has become a built-in guide for Alejandra’s recipe development.
When blueberries are in season, there is a blueberry doughnut. When the blueberry harvest ends, it is time to move on. “It gives you a schedule,” Conor said.
And, Alejandra added, using ingredients when they are actually in season helps make a better product.
The seasonal rotation also gives regular customers something to anticipate. Fall is particularly important: The apple flavors are among Daly’s Donuts’ biggest hits.
Alejandra has also begun asking customers what flavors they would like to see, although she makes no promises that every suggestion will become a doughnut.
That customer feedback is another benefit of having a storefront and a farmers market presence: The Dalys have direct access to the people who eat their food. That relationship has also been central to the company’s social media strategy.
Alejandra has shared parts of the couple’s story online without making Daly’s Donuts an exercise in oversharing. A post explaining the story behind the business before the store opened generated a surprisingly strong response.
Customers still tell her they loved reading it. “I think it is important to show the behind the scenes a little bit of the brand and who we are,” she said.
For a small food business, that personal connection can be a powerful competitive advantage. At their farmers market stands, consumers are not simply buying a doughnut; they are buying from a person whose story they know.
The Dalys have carried that philosophy from the market into the storefront. Their coffee program provides another example. Some customers have already incorporated a stop at Daly’s into their daily routines, coming in primarily for coffee.
Alejandra said she loves seeing people make that part of their day. Conor added, “To be a part of somebody’s ritual is a huge honor.”
The coffee comes from local Chicago roaster Sparrow, another deliberate choice as the Dalys build out the store without trying to be everything to everyone.
They recognize that Lincoln Park is a competitive neighborhood, with established coffee chains and restaurants competing for consumers’ discretionary spending. Their answer, once again, is differentiation.
If someone wants a simple drip coffee and a baked doughnut, Daly’s can be that destination. If someone wants a highly customized frozen coffee drink topped with whipped cream and caramel, there are other places for that.
The same principle that distinguishes a baked doughnut from a fried one can guide the broader business: figure out what you do well, understand what makes you different and build around it. “Entrepreneurship is literally just problem solving,” Conor said. “We’re not in the donut business; we’re in the business business.”
PERFECT TOGETHER
The most important problem-solving tool, however, may be the partnership between the two of them.
They bring complementary skills to Daly’s Donuts. Alejandra drives much of the creative, aesthetic and culinary side of the operation while maintaining a strong business sense. Conor gravitates toward administration, spreadsheets, business development and networking.
That division of responsibilities became particularly valuable as the business grew and they found themselves wearing every conceivable hat. “There’s things that she does I don’t even think about,” Conor said. “There’s things I do that she doesn’t think about.”
For all the operational systems and financial discipline, the couple acknowledges that the personal relationship has been one of their greatest assets.
The opening of the store tested that relationship in ways their farmers market operation never had. There were delays, equipment problems, licensing hurdles, long workdays and the emotional swings that come with putting a significant amount of money and effort into a new venture.
One day could feel like the best day ever. The next could leave them questioning everything. Having someone who understands the pressure — and can pick you up when things go badly — has made a difference. “We got very lucky with the yin-yang that each other does,” Conor said.
They never set out to build a doughnut company that would become their full-time livelihood. It started as a side hustle, a creative outlet and a small experiment that seemed low-risk enough to try.
Three years later, the experiment has a storefront, a growing team, a loyal farmers market following and customers who have made Daly’s Donuts part of their routines.
Now the challenge is different. It is no longer whether the business can work. It is figuring out how far to take it — and how to grow without losing the qualities that made it work in the first place.
For the moment, that means getting ready for fall, expanding catering, strengthening the team and continuing to make doughnuts that give Chicago consumers a reason to choose Daly’s.
And if the past three years are any indication, the next stage may arrive faster than the Dalys expect.
Comments