McDonald’s Ray Kroc: We Were There

cropped-photo-of-2126-n-larch-mcdonalds-9-57-page-001Hollywood’s portrayal of business and business leaders has a sorry history.  So I greeted the release of the film The Founder, ironically (it turns out) referring to McDonald’s founder Ray Kroc, with skepticism and even trepidation.

You see our 3rd-generation family business, Wolverine Development Corporation, and my father and grandfather were one of Kroc’s earliest partners in developing McDonald’s.  We built the first McDonald’s in Michigan and went on to develop five, four of which we still own.  They both became friends of Kroc—especially my grandfather, Ray’s contemporary.

I was surprised and gratified to find the film painstakingly accurate in telling the story of how Ray Kroc, a 52-year old sales manager for multi-spindle milk shake mixers from Chicago, stumbled upon Mac and Dick McDonald and their Speedee System in a quirky, octagonal hamburger stand in San Bernardino, California.

Fanatics for quality, service and cleanliness—the genesis of McDonald’s legendary mantra of QSC (V was later added for value)—everything that we know as McDonald’s was created by the McDonald brothers, not Kroc.  This is old news and a story Ray Kroc himself loved to tell over and over again.

Kroc and the brothers agreed to franchise the concept under contracts in which the McDonald brothers received 1.9% of gross sales and Kroc 0.5%.  Predictably, the fastidious, hands-on operators and the visionary developer sparred with increasing intensity—and why not?  Can there be two more different types of animals in the business world?

In 1961, Kroc—going deeply in to debt—purchased the McDonald brothers’ interest for $2.7 Million.  Adjusting for inflation, the brothers received a whopping $21.7 Million without ever operating anything other than their stand in San Bernardino!  Still, Hollywood needs a villain, and successful business owners seem to occupy their innermost sanctum of evil.  So an ever dark and aggressive Kroc is seen to essentially rob the McDonald brothers of their creation.  The “founder” of McDonald’s—hah!

Facts are facts, and the producers are to be praised for getting their’s correct.  But my father and grandfather will tell you—and they were there—of Ray Kroc’s intense devotion to the formula which the McDonald brothers created.  Long after Kroc and McDonald’s made it big, Ray Kroc began his store inspections by picking up trash in the parking lot.  The message was clear:  Details matter, and nobody—not even the chairman of McDonald’s Corporation—is above honoring that founding principle.

The McDonald brothers and Ray Kroc needed each other.  And in the end, they all did just fine.  Now that’s a Hollywood ending worth telling.


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