In this episode of Modeling the Masters, Evan Carmichael tells the story of Ray Kroc, the man who turned a single California hamburger stand into the global McDonald’s empire. Carmichael outlines Kroc’s early career selling paper cups and a milk‑shake mixer, his discovery of the McDonald brothers’ efficient restaurant, and how he leveraged that opportunity to build a $22 billion business with 400,000 employees. The video then distills Kroc’s success into three actionable lessons for entrepreneurs: (1) constantly scout for new opportunities and act on them; (2) hire the right people, give them ownership, and solicit their ideas (e.g., the suggestion box that birthed the Happy Meal, Filet‑O‑Fish, etc.); and (3) embed yourself in the community by living locally, supporting local advertising, and giving back through charity. The presentation closes with a quirky anecdote about a childhood phrenology reading that predicted Kroc’s future in fast food. Throughout, Carmichael emphasizes practical take‑aways and encourages viewers to apply these principles to their own businesses.
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Hi, I'm Evan Carmichael. Welcome to another edition of Modeling the Masters. Today we're going to look at the builder of one of the most recognized companies of all time, Ray Kroc from McDonald's.
Raymond Albert Kroc was a Czech-American businessman who took over the small-scale McDonald's Corporation franchise in 1954 and built it into the most successful fast food operation in the world. Kroc was included in Time 100: The Most Important People of the Century and amassed a $500 million fortune during his lifetime. He was also the owner of the San Diego Padres baseball team starting in 1974. Ray Kroc began his career selling paper cups for the Lily Tulip Cup. It was in the course of selling paper cups that Kroc would meet Earl Prince. Kroc had noticed Prince after he began buying Lily Cups by the truckload for a product that he had recently invented, a 5-spindle milkshake mixer. Kroc saw big opportunities in the milkshake mixer and bought the exclusive marketing rights to the product. Over the next 17 years, Kroc would travel across America selling it. When he received an order for 8 milkshake mixers from brothers Dick and Mac McDonald in California, he had to go out to see them. The McDonald brothers had focused on just a few menu items, hamburgers, cheeseburgers, french fries, soft drinks, and milkshakes. Kroc was impressed with the efficiency and the popularity of the restaurant and saw his next best business opportunity with them. In one of the greatest success stories of all time, Kroc took a small but successful California-based hamburger restaurant and expanded it into what today is a worldwide chain of 400,000 employees, $22 billion in revenue, and a logo that has come to become globally recognized more than the Christian cross.
So the next question becomes, how can you model the success of Ray Kroc? Here are 3 action items that you can put to use in your business today.
Action item number 1: Always be on the lookout for opportunities. Most entrepreneurs don't end up being successful with the product or service that they start with. There are always tweaks and changes that will happen once you start talking to customers and they tell you what they want. Your prospects and customers will lead you to many potential opportunities to grow your business. The key is to jump on those opportunities and take action. In Ray Kroc's own words, the two most important requirements for major success are: first, being in the right place at the right time, and second, doing something about it. Kroc started out as a salesman for paper cups, and his customers twice brought him to new business opportunities that he acted on. Sometimes this can mean selling a completely different product or service than you were offering before. Look at your current customers. Are there hidden business opportunities you can develop with them, or improvements to what you're currently selling that can bring more value to them and put more money in your bank account? If you're always on the lookout for new opportunities to grow your business, you'll eventually find the one you can hit a home run with. Action Item #2: You're only as good as the people you hire. As your business grows beyond yourself, you'll realize the importance of having a good team. They are the ones representing your company, making decisions every day, and talking to your customers. Having a good staff will make or break your ability to build a successful company beyond yourself. To make sure he had the best team possible in the early stages of the business, Ray Kroc personally took charge of the entire hiring process. Once he had made the decision to bring someone on board the McDonald's team, Kroc would give each and every one of them a badge with the title of "Management Trainee." It didn't matter what their actual job was. Kroc wanted every employee to feel valuable and like an important part of his team. Kroc would then tell his workers to think of better ways to do their job or any improvements they could in customer service, which could then be written down and placed into a suggestion box. The suggestion box led to countless successes like the Happy Meal, Filet-O-Fish, Big Mac, hot apple pie, and Egg McMuffin. When you hire a new employee, make them feel like they're an important part of your team. Encourage their suggestions on how the business could be run better. Create opportunities for them to advance. And let them know that you value their contributions. A loyal and hardworking team will reward you with outstanding business results. Action Item #3: Be a part of your community. Whatever community you sell to, make sure you take part in building that community base and making it stronger. These are the people who will continue to buy from you, and the more successful they are, the more successful you will be. Ray Kroc launched a number of initiatives to help build the communities around each McDonald's restaurant. First off, he insisted that his franchise operators lived in the communities where they worked. He also hired regional advertising agencies so they could work on the ground and organize grand openings, birthday parties, and community programs. Finally, he believed in community involvement through charities and the company continues to give back to this day as part of its corporate philosophy. You don't have to run a restaurant to be involved in your community. Just think about the people you sell to and where they hang out. How can you get involved in making their lives easier and better? It's a longer-term strategy, but extremely profitable if you can win the hearts and minds of your customers by giving back.
So remember, always be on the lookout for opportunities. You're only as good as the people you hire. And be a part of your community. To finish off the video, I wanted to share one of my favorite true stories about Ray Kroc.
When Kroc was just 4 years old, his father took him to a phrenologist to try to have his future determined based on the shape of his head. Here, the young Kroc was told that he would be best suited to having a career in the fast food industry. Nearly 50 years later, he would fulfill the prediction.
Thank you for joining me for another edition of Modeling the Masters. I hope you enjoy. I'd love to hear your feedback. If you want to leave a comment below, And stay tuned for the next episode.
