Jimmy John Liautaud – From Average Man to Billionaire

Jimmy John Liautaud, founder of restaurant chain Jimmy John’s, has proven to be a success story. In just over three decades he has gone from an average man to millionaire to billionaire. He started the first Jimmy John’s sandwich shop in 1983 right out of high school when he was 19. At his high school, Elgin Academy, he had one teacher named Jim Lyons who believed in him and inspired him to finish his education. Having had such an astounding mentor, Jimmy knew he was capable of doing great things. Jimmy’s father thought he should enlist in the Army, but Jimmy had other plans. After graduating, Jimmy set out to start his own business. The tale goes he first had the desire to start a hotdog stand. Jimmy made a deal with his father – his dad would lend him $25,000 (about $64,171 in 2019) to start his own business, and if it succeeded, his dad would own 48% of the business; if it did not succeed, Jimmy would agree to enlist with the other G.I.s. 

After researching the ins and outs of various hotdog stands, Jimmy had the realization it would cost him about $45,000 just for the equipment to start his business. His dad would not budge on the loan of $25,000, so Jimmy had to change his idea. Jimmy then had his golden idea — he decided instead to open a sandwich shop which would be simpler and cost much less. Jimmy created six sandwiches and brought them to his family for taste-testing. He was able to narrow down his options to four choices, and his menu came to fruition. Jimmy found a two-car garage in an alley in Charleston, Illinois that had previously been a pizza shop. He converted the set up with his own style, and on January 13, 1983, the first Jimmy John’s Gourmet Sandwiches opened for business. It was near local bars and was a perfect spot for hungry college students. 

The sandwich shop was slow to start at first, and then Jimmy had an epiphany. He realized he could spread the word by passing out small samples of his sandwiches across neighboring blocks. He realized he could print business cards with his simple menu on the back and pass them out around the nearby university. The marketing tactic worked, and eventually Jimmy made a $40,000 profit in his first year. With success steadily rising, Jimmy was able to buy out his father by paying back his original loan plus interest by 1986. By the time 1994 came around, Jimmy had made his first $1 million, had 10 shops in business, and sold his first franchise. Jimmy Johns had 160 stores by 2002, but unfortunately 70 of them were struggling. He made the decision to stop selling franchises for a year to develop a strategic plan. 

Jimmy took a trip with Jimmy John’s president James North to visit their restaurants across the country in order to retrain every franchise owner and team side-by-side on correct systems and procedures. He knew that taking the time to exemplify how his shops should be run as well as being able to share his knowledge in a face-to-face setting would make all the difference with employees. After having dealt with the reality of demands in all kinds of locations, Jimmy and James were able to set higher expectations for their franchisees upon returning from their trip. Afterwards, success began to rise again. 

Founder Jimmy John Liautaud’s influence on the food industry became noteworthy – in 2007, Jimmy John’s opened their 500^th location; in 2010, they opened their 1000^th location; in 2014, they opened their 2000^th location. Because of his determination, mentors and leaders from within and outside the company, and many dedicated employees, Jimmy John’s was able to become one of the fastest growing restaurant chains in the United States. Jimmy John’s soon brought on an investor, Weston Presidio, in 2007, which helped boost sandwich sales from $300 million to $2.5 billion in 2014. They then exited, and Jimmy was cautious about bringing on another investor as well as taking the company public. He knew he did not want to have an IPO because he was hesitant about working with Wall Street. In 2016, after deeming himself comfortable with a big change and a sufficient deal, Jimmy John Liautaud sold a majority stake of his company to private equity firm Roark Capital. Roark also owns such brands as Arby’s, Buffalo Wild Wings, Cinnabon, and Jamba Juice. He retained 35% as the single largest individual shareholder and stayed on as the Chairman of the company, which allowed him to focus on more specific aspects of the business as well as personal philanthropic efforts. 

Jimmy started the Liautaud Family Foundation along with his wife Leslie with the idea to give funds to charities that support and promote families, the military, education, health and wellness, and the arts. Over the years, Jimmy has donated considerable contributions to organizations such as the Mayo Clinic, the American Heart Association, Camp Southern Ground, Champaign County Youth Assessment Center, Crisis Nursery, and Frances Nelson SmileHealthy dental clinic. Keeping in mind his father and two brothers who served in the Army, Jimmy also donated $1 million to the Folds of Honor Foundation which has helped provide educational scholarships to children and spouses of America’s fallen and disabled service members. Jimmy even donated some of his wealth back to Elgin Academy where he had difficulty in school yet was helped by his mentor Jim Lyons. His $1 million donation helped to construct a new building housing twelve classrooms, a theater, and a library. 

With almost 2,800 Jimmy John’s locations in 43 states and numerous awards to his name, founder and billionaire Jimmy John Liautaud has reached a point of success that every entrepreneur can only dream of. He did not start with a clear-cut idea of what his business was going to be, but with the guidance of others and through an evolving vision of his own, he fully pursued the dream of creating an iconic American sandwich shop brand.