The Homeless Man Who Created Domino's with His Last $15
Summary
TLDRThe transcript narrates the rags-to-riches story of Tom Monaghan, the founder of Domino's Pizza. Born into hardship, Monaghan overcame a tumultuous childhood, homelessness, and multiple career setbacks to revolutionize the pizza delivery industry. His innovative approach to franchising, delivery, and packaging transformed a struggling store into a global billion-dollar empire, with Domino's becoming the world's largest pizza delivery company.
Takeaways
- π The founder of Domino's, Tom, started with an unwanted pizza store and turned it into a billion-dollar empire.
- π Tom was born into hardship, experiencing homelessness and foster care in his early life.
- π¨βπ³ He had various jobs from a young age, showing entrepreneurial spirit and a knack for improving efficiency.
- π Despite wanting to become a priest, Tom's path took a different turn after being expelled from the seminary.
- π Tom's time in the Marine Corps was pivotal, where he developed resilience and a vision for building an empire.
- π‘ A pivotal moment in Domino's success was Tom's decision to simplify the menu and offer free delivery.
- π Tom faced financial struggles and homelessness but persevered, eventually turning a loss-making store into a profitable one.
- π After initial failures, Tom learned from his mistakes and adapted his business model, leading to rapid growth.
- π’ The introduction of the 30-minute delivery guarantee was a game-changer, setting Domino's apart in the pizza industry.
- π Domino's expanded globally, with Tom's innovative ideas and business strategies propelling it to become the world's largest pizza delivery company.
Q & A
What was the name of the founder of Domino's and when was he born?
-The founder of Domino's was Tom Monaghan, and he was born on Saint Patrick's Day in 1937.
Why did Tom's mother place him and his brother into foster care?
-Tom's mother placed him and his brother into foster care because after their father passed away, she could no longer afford to raise them on her own.
What was Tom's first entrepreneurial idea?
-Tom's first entrepreneurial idea was to create a machine to shake down cherry trees and catch the cherries in a tarp to make the process more efficient.
How did Tom end up homeless during his early days in the pizza business?
-Tom became homeless because the pizza store he bought was losing money every week, and he couldn't afford to pay his rent, so he had to sleep in the store.
What was the turning point that led to the profitability of the first Domino's store?
-The turning point was when Tom decided to limit the types of pizzas they made, which resulted in their most profitable night ever. He then focused on keeping the menu simple and delivering for free.
Why did Tom change the name of the store from 'Dominic's' to 'Domino's'?
-Tom changed the name to 'Domino's' because the former owner of the third store called and said he couldn't use their name anymore due to customer confusion.
What innovative packaging did Tom introduce to solve the issue of keeping pizzas fresh during delivery?
-Tom introduced a corrugated paper box with holes to strengthen insulation and retain heat longer, which helped keep the ingredients moist and the crust crispy.
What was the ambitious goal Tom set for Domino's expansion in 1969?
-Tom's ambitious goal was to open a new store a week by 1969, and he nearly met that goal with 32 Domino's stores open.
How did Tom manage to pay off his debt and lawsuits after almost going bankrupt?
-Tom managed to pay off his debt and lawsuits by committing to pay his creditors one at a time, focusing on keeping the business open to generate the necessary revenue.
What policy did Tom create that significantly boosted the growth of Domino's?
-Tom created the policy that if customers didn't receive their order within 30 minutes, it was free. This policy, along with other innovations, helped Domino's grow to over 5,000 stores.
How did Tom's early life experiences influence his approach to business?
-Tom's early life experiences, including his time in foster care, various jobs, and periods of homelessness, instilled in him a resilience and an entrepreneurial spirit that he applied to building Domino's into a billion-dollar empire.
Outlines
π Early Struggles and Entrepreneurial Beginnings
The script introduces Tom Monaghan, the founder of Domino's Pizza, who was born into hardship and faced numerous challenges in his early life. After his father's death, Tom and his brother were placed in a foster home. Tom's entrepreneurial spirit was ignited early, as he sought work and devised innovative solutions to problems, like creating a cherry-picking machine. Despite his mother's efforts to provide for him, their relationship deteriorated, leading to Tom's return to foster care. His life was marked by a series of difficult jobs and a desire to succeed, which was evident in his various endeavors, from selling newspapers to fishing and selling his catches. His dream of becoming a priest was short-lived, and after being expelled from the seminary, he faced further family discord, leading to his placement in a juvenile delinquent home. Despite these setbacks, Tom's determination to succeed remained unshaken.
π From Homelessness to Building a Pizza Empire
The narrative continues with Tom's journey from homelessness to building a billion-dollar pizza empire. After losing his savings in a failed investment, Tom hitchhiked to Ann Arbor and worked as a newspaper supervisor. He scraped together enough money for college tuition but dropped out due to financial constraints. His entrepreneurial spirit led him to sell newspaper subscriptions and eventually, with his brother Jim, purchase a struggling pizza store called Dominic's. Despite initial challenges, Tom's innovative approach to simplifying the menu and offering free delivery turned the business around. His decision to limit the types of pizzas and focus on delivery proved profitable. Tom's ambition grew, leading him to open a second store and eventually rebrand as Domino's. His innovative ideas, such as the introduction of a corrugated pizza box with holes, revolutionized the pizza delivery industry.
π Overcoming Setbacks and Achieving Global Success
The final paragraph details Tom's challenges and eventual triumphs in expanding Domino's into a global franchise. After attending a franchise seminar and meeting industry giants like Ray Kroc, Tom set an ambitious goal of opening a new store every week. Despite facing significant debt and near bankruptcy, Tom's determination led him to restructure his business model, eliminating initial franchise fees and focusing on quality and customer service. His innovative 30-minute delivery guarantee further propelled Domino's growth. By 1983, the company had over a thousand stores, and Tom's vision had transformed a single pizza store into the world's largest pizza delivery company, with a presence in more than 85 countries and a value of nine billion dollars. The story concludes by highlighting Tom's journey from an orphan with bad luck to a successful entrepreneur.
Mindmap
Keywords
π‘Entrepreneur
π‘Franchise
π‘Innovation
π‘Risk
π‘Adaptability
π‘Debt
π‘Homelessness
π‘Delivery
π‘Empire
π‘Orphan
π‘Strategic Thinking
Highlights
Tom Monaghan, the founder of Domino's, was born on St. Patrick's Day in 1937 and experienced a challenging childhood including periods of homelessness.
After his father's death, Tom and his brother were placed in a foster home due to financial struggles.
Tom's entrepreneurial spirit was evident from a young age, as he sought out jobs and thought of innovative solutions like a cherry-picking machine.
Despite a strained relationship with his mother, Tom's determination led him to apply to a seminary to become a priest.
Tom's dream of becoming a priest ended when he was told he didn't have a vocation and was kicked out of the seminary.
He joined the Marine Corps, viewing it as a way to improve himself mentally and physically, and to handle any future challenges.
After losing his college tuition in a failed investment, Tom hitchhiked to Ann Arbor and started working for a local newspaper.
Tom and his brother Jim bought a struggling pizza store, Dominic's, which would later become Domino's.
Facing homelessness, Tom lived in the pizza store and innovated by simplifying the menu and offering free delivery.
Domino's became the first pizza store to offer free delivery, a strategy that significantly boosted its sales.
Tom's innovative thinking led to the development of a corrugated pizza box with holes to maintain pizza quality during delivery.
Domino's rapid expansion led to financial difficulties, with Tom accumulating $1.5 million in debt.
Tom regained control of Domino's from the bank, which had worsened the company's financial situation.
A new franchising model requiring no initial fee and a year of store management led to Domino's resurgence and growth.
The '30-minute guarantee' policy, offering free pizza if not delivered on time, became a hallmark of Domino's service.
Domino's reached a milestone of over 5,000 stores and became the world's largest pizza delivery company.
Tom Monaghan's journey showcases how an orphan with a series of setbacks built a billion-dollar pizza empire.
Transcripts
mr trump here you go up three media
pizzas five dollars each
i'll tell you what i'll counter that
offer with an even better one here's the
deal
you give me those three pizzas only i'll
give you
just five dollars a piece
sure okay
still got it donald still got it
the dominoes we know and love today has
become a billion dollar empire
but before it joined the ranks of
mcdonald's and kfc
it was an unwanted pizza store that
changed when the founder went from being
homeless to the genius behind delivering
for free
the unwanted child
in 1937 tom was born on saint patrick's
day in ann arbor
when tom was just four years old his
father passed away on christmas eve
without their father tom's mother could
no longer afford to raise her own kids
she placed both tom and his brother jim
into a foster home
on the first day at his new home tom got
into a fight
he longed day after day for his mother
to return
nearly seven years later tom's mother
had become a nurse
and was able to provide for her two sons
she moved the family back to traverse
city where tom started school at tom's
new catholic school
he met father russell pasino he was
aware of tom's family situation
and gave tom odd jobs to do around the
school and church for 35 cents an hour
after the seventh grade tom moved
schools
he was still keen on working and decided
to look for an opportunity by walking up
and down the main street of his town
he later found a job selling newspapers
and a summer job picking cherries
the work was hard and tedious he
remembers thinking that the business
would be more efficient if they made a
machine to shake down the trees
and catch the cherries in the tarp it
was the first
instance where he started thinking like
an entrepreneur
to make more money tom would go fishing
and then sell his catches door to door
while thinking of other ideas as his
carefree and entrepreneurial spirit grew
his relationship with his mother
withered they constantly argued until
his mother decided to put him
and his brother back into foster care
tom moved from one farm to another and
ended up getting a job at a bowling
alley
he worked from 6 30 until midnight five
days a week
by high school tom moved again but this
time
into a ramshackle farm that had no
electricity
during the winter time frosts and light
peered through the cracks of the walls
life was difficult the clothes tom wore
were worn out and filled with holes
and his shoes were always covered in
manure while walking to school
he would keep his feet to the floor
hoping no other students would notice
one day he started to reflect on his
path while shoveling a pile of manure
that reached his ankles
how did i get so off track
it was then that he decided that he was
going to fulfill his dream of becoming a
priest
so he applied to a seminary and was able
to attend after his mother offered to
pay with her savings
tom felt right at home at the seminary
and didn't get home sick like the other
boys
he was even somewhat mischievous he got
into pillow fights and would talk in the
study hall but he never did anything too
serious
in less than a year he kicked tom out of
the seminary and told him he didn't have
a vocation
tom's dream of becoming a priest was
crushed
afterwards he was forced to move back
into his mother's home
they constantly argued as they did
before until his mother gave up on him
without telling him she sent a police
officer to fetch him after school
and send him to a juvenile delinquent
home
i felt like a criminal but had done
nothing wrong
embarrassed tom would walk a different
route from school to home
so that his classmates would never know
fortunately when his aunt and uncle
found out they petitioned the courts to
have him live with them instead
the first big mistake
by then tom didn't care about graduating
high school
until he saw his aunt making
preparations for his graduation
not wanting to disappoint her he asked
his teacher if there was anything he
could do to graduate
she gave in to his plays and allowed him
to graduate last in his class
in his yearbook he wrote the harder i
try to be good
the worse i get but i may do something
sensational yet
he attended ferris state college
improved his marks and applied to the
university of michigan
after being accepted he couldn't afford
the tuition
so he left to join the marine corps
thinking it was the army
by the time he realized it was too late
he could no longer attend college for
another two years
all he could do was make the best out of
the situation
if i could survive the marines i knew i
could handle anything
while training he decided to focus on
improving himself mentally and
physically
he started reading inspirational books
and would imagine himself building an
empire robbed of college dream
in 1959 tom was dispatched from the
marines
he had two thousand dollars in savings
put aside for his college tuition
but he lost every penny after meeting a
slick businessman
who convinced him to invest in a get
rich quick scheme
with only 15 dollars left in his pockets
he hitchhiked from san diego
to ann arbor he moved in with his
younger brother jim
and got a job as a supervisor for a
local newspaper
he scraped just enough money for his
college tuition but dropped out after
three weeks
he had no money left for books and
decided to try again in the next
semester
to make more money he started selling
newspaper subscriptions
he ended up getting many customers by
offering to deliver
the experience showed him the appeal in
delivery and that when you see an
opportunity
it's important to seize it when the
semester came around
he was able to pay for his tuition and
books but he dropped out again
he was so busy working that he had no
time to study
at 23 years old he was a two-time
dropout driving a beat-up car
he felt like any dreams he had for the
future was falling apart
that's when his younger brother jim came
to his rescue
he heard that a small store was on the
market for a cheap price
it was called dominic's in ipsilanti
near eastern michigan university
he asked tom if he wanted to buy the
store with him they could split shifts
so that tom would have enough time to
study
tom only had 77 dollars in his bank
account
so he took out a 500 loan and bought the
store with jim
right after they signed the agreement
jim got cold feet
he was scared to leave the security of
his job as a mailman
six months later he gave into his fears
after tom took his first night off jim
realized that running the store
was too much work and quit so tom had no
choice but to take over
instead of returning to college at first
he was disappointed he decided that if
he was going to be in the pizza business
it would have to be the best in the
country
forced into homelessness
tom was thinking big but his business
was far from growing
in fact the store was losing money every
single week
when he ran out of money he had no
choice but to live off stale popcorn
that he found in a cupboard for a week
he couldn't afford to eat his own pizza
unless it was burned
eventually he became homeless too he
couldn't pay for his rent and slept in
the store
his luck seemed to be getting worse with
each passing day
one evening half of his staff didn't
show up so that's when he decided to
limit the types of pizzas they made
it turned out to be their most
profitable night ever
from then on he focused on keeping his
menu simple
and delivering for free he was the first
pizza store to do this
after the ipsilanti store became
profitable he decided to open a second
store in mount pleasant near central
michigan university
the night that he signed the agreement
he laid in bed feeling scared to death
why am i taking a risk on a second store
when the first one is doing so well
tom realized it too late to go back on
his commitment
not only was the agreement signed but he
had also purchased the equipment
fortunately it turned out to be a risk
well worth taking
that location along with the first
became the busiest pizza stores in the
country
they sold thousands of pizzas each week
most of its business came from students
living on campus and customers wanting
delivery
challenging the industry standard
after just a few years tom slowly built
his empire
much like he envisioned when he was
training in the marines
when he opened his third store the
former owner called
tom wasn't allowed to use their name
anymore since their customers were
getting confused
so he settled on domino's after one of
his drivers told him he was known as
that guy from domino's
this was the least of his problems the
more pizza he delivered the more issues
he'd encountered
it was hard to keep a balance of the
ingredients staying moist and the crust
crispy so tom asked a manufacturer to
develop a box made of corrugated paper
with holes since it could strengthen
insulation
and retain heat longer they were
reluctant to make it but tom
kept pushing american technology is
putting space satellites in orbit these
days and you're telling me you can't
punch a clean hole in a piece of
cardboard
tom's idea ended up being extremely
cheap and mass producible
it inspired him to come up with more
ideas that became the industry standard
including heated pouches conveyor ovens
doe trays
and commissaries a billion dollar empire
in the late 60s tom attended a franchise
seminar at boston college
there he met ray kroc from mcdonald's
and josh brown from kfc
both men were responsible for turning
what was once a small restaurant
into a major franchise they inspired tom
to continue to deliver as a focus on
franchising
nobody thought you could make money on
delivery most places delivered just to
get some volume before they could afford
to cut out the service
but i thought i could do it it was then
that he set the ambitious goal of
opening
a new store a week by 1969
he nearly met that goal 32 domino stores
open
but almost all of them failed and tom
found himself
1.5 million dollars in debt to avoid
bankruptcy he relinquished control of
the company to a bank
they brought in a so-called expert who
made things even worse by raising prices
and cutting back on quality within a
year
the bank handed the company back to tom
it was in the worst financial shape ever
franchisees filed lawsuits and suppliers
hadn't been paid in a long time
i had well over a thousand creditors and
got lawsuits from about 150 of them
i was on the phone every day telling
them all the same thing
all i can do is pay for my food and rent
so i can stay
open and pay you one at a time
tom slowly won them back and within a
year he paid off his debt
all of the lawsuits in his debt made him
realize that he needed to change his
business model
anyone who wanted to franchise no longer
had to pay an initial fee
instead they had to manage a store for
at least a year
successfully tom's idea not only worked
but proved to be extremely successful
by 1983 there were over one thousand
domino stores
a three thousand percent increase the
company grew even more after tom created
a new policy
if customers didn't receive their order
within 30 minutes
it was free only a year later
tom opened over 5 000 stores and
domino's became the largest pizza
delivery company in the world
he also managed to buy the detroit
tigers today
domino's is worth nine billion dollars
and has stores in more than 85 countries
this is the story of how an orphan with
the worst luck turned a single pizza
store
into a billion dollar empire
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