Jimmy John Liautaud, age 54, opened his first sandwich shop 35 years ago, and the restaurant chain has grown to 2,802 locations with $2 billion in annual sales. Lately, Jimmy no longer runs the business as he feels he has outgrown the franchise.
In 2016, a private equity firm named Roark Capital bought a majority share of the business for $3 billion. Jimmy John still owns 35% of the company that he built. With the money from that deal and his other investments, Jimmy is worth $1.7 billion.
Jimmy is no longer at the head of the sandwich shop chain, but he has a leadership role in the food and culture department. Liautaud is still the Chairman, but the equity firm has the final say on decisions that affect the company.
Roark also owns majority shares of Buffalo Wild Wings, Arby’s and other restaurant chains. Jimmy considers the equity firm to be a stark contrast to his boisterous image.
Liautaud uses profanity often, and he makes up playful nicknames for himself. In contrast, Roark got its name from an Ayn Rand novel, which gives them an air of gravitas. Neal Aronson, the firm’s founder, described Liautaud as fun and exciting.
It’s uncertain how well Liautaud will be able to adapt to the more traditional management style of Roark or how he will deal with being in a less authoritative position.
Liautaud’s boisterous personality is certain to test some people’s resolve at times. Jimmy John realized that he might need to hand over the reins of the company when his company’s sales had slipped for three consecutive years. He now claims that he feels more at peace with having new management in charge.
These kinds of ups and downs are not new to Jimmy John. His family didn’t have a lot of money when he grew up. His mother immigrated from Lithuania and taught elementary school in Illinois. His father was an entrepreneur who had to file for bankruptcy twice.
Liautaud remembers having to drink powdered milk between the ages of 8 and 12. Jimmy got poor grades in high school, and he describes himself at that age as a “fat kid.”
Luckily, Liautaud’s father had secured a high-paying job by the time Jimmy graduated from high school, and he gave his son $25,000 to start a business. Jimmy had to agree to join the army if his business wasn’t successful within its first year.
He wanted to start a hot dog stand at first, but he realized that a submarine sandwich shop would require less startup capital. The first Jimmy John’s shop opened in 1983 near Eastern Illinois University when Jimmy was only 19 years old. His father owned 48 percent of the business at that time.
Further Reading: Start and Grow Your Business: Guest Speaker Jimmy John Liautaud
In the shop’s first year, it made $120,000 in sales and $40,000 in net profit. The next year, he bought out his father’s share of the business.
Jimmy opened a second store in 1986 near Western Illinois University, and by 1994, he had 10 stores that were pulling in $1 million per year in profit. The store has always maintained a simple menu that sets it apart from competitors.
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